Economics Terms Quiz

What does the term 'utility' mean in economics?

According to economists, why do people act rationally in their self-interest?

What is one advantage of the corporate form of business?

What type of statements are most common in disagreements among economists?

Which fallacy suggests that what is true for the individual must necessarily be true for the group?

What fallacy is committed in the statement: 'The government deregulated the electricity industry in California and a shortage of electricity soon occurred. It is clear that the deregulation caused the shortage'?

What does the term 'laissez-faire' translate to in English?

From where does the science of economics primarily stem?

What type of resource is a computer programmer considered in economics?

What does the law of demand state?

What is the function of a market in economics?

What concept does the idea of opportunity cost suggest?

Key Concepts in Economics

Utility refers to the satisfaction or pleasure that a person derives from consuming a good or service.

Rational Self-Interest

Economists believe that people act rationally in their self-interest because they make decisions based on their own preferences and goals.

Business Organizations

One advantage of the corporate form of business is that it provides limited liability to its owners, protecting their personal assets.

Economic Disagreements

Normative statements, which involve value judgments, are most common in disagreements among economists.

Fallacies

The fallacy of composition suggests that what is true for the individual must necessarily be true for the group.
The fallacy of false cause is committed when one assumes that because two events are correlated, one must have caused the other, as in the example of deregulation and electricity shortage.

Economic Terms

Laissez-faire translates to "let do" or "let go" in English, advocating for minimal government intervention in economic matters.

Roots of Economics

The science of economics primarily stems from the study of human behavior and decision-making.

Resources

A computer programmer is considered a human resource in economics, as they provide labor and skills.

Demand and Supply

The law of demand states that as the price of a good increases, the quantity demanded of it decreases, ceteris paribus.

Market Functions

The function of a market in economics is to allocate resources and distribute goods and services among consumers.

Opportunity Cost

The concept of opportunity cost suggests that the value of the next best alternative that is given up when a choice is made represents the cost of that choice.

Test your knowledge of economics terms with these quiz questions. From understanding the concept of utility to advantages of the corporate form of business, this quiz covers a range of key economic principles.