240 Questions
What is the primary objective of most businesses?
Profit maximization
What happens to demand when the price of a good increases?
Demand typically decreases
What represents the cost of one good or service in terms of another?
Relative prices
What happens to supply when prices increase?
Supply typically increases
What is the relationship between two goods when an increase in the price of one good boosts demand for the other?
Substitutes
What is the term for a good whose demand increases when its price decreases?
Normal good
What is the primary focus of the dynamics of markets?
Relationships between markets
What determines how resources are distributed in an economy?
Relative prices
What is accounting profit?
The profit that only considers explicit costs.
What is the purpose of calculating marginal cost?
To determine the optimal level of production.
What occurs when increasing the scale of production leads to a lower cost per unit?
Economies of scale
What is total revenue calculated as?
Price x Quantity
What is profit calculated as?
TR - TC
What is the purpose of calculating average fixed cost?
To calculate the fixed costs per unit.
What is the main difference between the short run and the long run in terms of costs?
In the long run, all costs are variable.
What is the definition of normal profit?
The minimum profit needed for sustainability.
What is marginal revenue?
The additional income from selling one more unit.
Why is understanding revenue and costs important for businesses?
To make informed decisions on pricing and production strategies.
What is price elasticity of demand?
The responsiveness of quantity demanded to a change in price
What happens when demand is elastic?
A small price change causes a significant change in quantity demanded
What is one factor that affects price elasticity of demand?
Time period
What is cross elasticity of demand?
The responsiveness of quantity demanded of one good to a change in price of another good
What is the characteristic of inferior goods?
Negative income elasticity of demand
What is the main feature of globalization?
The movement of goods and services across national borders
What is one cause of globalization?
Capital movement
What happens when supply is elastic?
Suppliers can increase output without a significant rise in cost
What is one factor that affects price elasticity of supply?
Time to respond
What is the purpose of understanding elasticities?
To make more informed decisions regarding pricing strategies and production levels
What is one of the main drivers of globalization?
Technological advances
What is a characteristic of economic integration?
Removal of trade barriers
What is a disadvantage of globalization?
Inequality
What is the concept of absolute advantage based on?
Producing a good more efficiently than other countries
What is a characteristic of the North-South Divide?
Significant income gap between developed and developing countries
What is a benefit of globalization?
Economic growth
What is the result of multinational corporations operating in multiple countries?
Exploitation of geographic advantages
What is the impact of trade on consumers?
Lower prices and more varied products
What is a major consequence of climate change in South Africa?
Unpredictable rainfall patterns
What is the main concern of environmental sustainability?
Environmental deterioration
What is a major contributor to land degradation in South Africa?
Overgrazing
What is the result of trade liberalization?
Reduction of tariffs and other trade barriers
What is a legal measure implemented by South Africa to combat environmental degradation?
National Environment Management Act
What is an initiative to reduce emissions in South Africa?
Improving public transport
What is a goal of sustainable environmental management?
Preserving natural resources for future generations
What is a major environmental impact of mining and industrial activities in South Africa?
Significant environmental pollution and health issues
What is an international agreement that South Africa participates in?
Kyoto Treaty
What is a national strategy aimed at integrating sustainable practices in South Africa?
National Strategy for Sustainable Development
What is a benefit of promoting eco-tourism in South Africa?
Encouraging environmentally responsible practices
What is a consequence of overpopulation in South Africa?
Depletion of resources like water
What is a key driver of globalization?
Technological advances
What is a characteristic of multinational corporations?
Exploiting geographic advantages
What is an advantage of globalization?
Access to new markets
What is the concept of comparative advantage based on?
The lowest opportunity cost
What is a characteristic of the North-South Divide?
Socio-economic and political differences between countries
What is a disadvantage of globalization?
Increased inequality
What is the result of trade liberalization?
Reduced tariffs and trade barriers
What is the impact of trade on consumers?
Lower prices and more varied products
What is economic integration characterized by?
Removal of trade barriers and standardization of laws
What is the main concern of environmental sustainability?
Environmental degradation
What is the main factor that influences consumer and producer decisions about what to buy or produce?
Relative prices
What is the result of a decrease in the price of one good on the demand for a related good that is used together with it?
Increased demand
What is the primary objective of most businesses in the economic framework?
Profit maximization
What happens to the demand for a substitute good when the price of another good increases?
Increased demand
What is the dynamic relationship between cost, revenue, and profitability in a business?
Profitability is influenced by the relationship between cost and revenue
What is the role of law of supply in determining economic dynamics?
Higher prices encourage increased production and supply
What is the main factor that influences demand for a good or service?
All of the above
What is the result of a shift in relative prices in an economy?
Change in resource allocation
What is a major environmental problem in South Africa?
Loss of biodiversity
What is a measure implemented by South Africa to protect the environment?
Subsidies for renewable energy
What is an approach to sustainable environmental management?
Education and awareness
What is a global agreement that South Africa participates in?
Millennium Development Goals
What is a consequence of climate change in South Africa?
All of the above
What is a reason for promoting eco-tourism in South Africa?
To promote environmentally responsible tourism
What is a cause of land degradation in South Africa?
Poor agricultural practices
What is a national strategy in South Africa?
The National Strategy for Sustainable Development
What is a consequence of mining and industrial activities in South Africa?
All of the above
What is a goal of sustainable environmental management?
To maintain natural resources for future generations
What does accounting profit not account for?
Implicit costs
What is the purpose of calculating marginal cost?
To make decisions about production levels
What occurs when increasing the scale of production leads to a higher cost per unit?
Decreasing returns to scale
What is the formula for calculating average total cost?
TC / Q
What is the difference between short run and long run costs?
Some costs are fixed in the short run, while all costs are variable in the long run
What is normal profit?
The minimum profit needed for sustainability
What is the purpose of calculating average fixed cost?
To understand how fixed costs change with output
What is the formula for calculating marginal revenue?
Change in TR when one more unit is produced
What is the main difference between economic profit and accounting profit?
Economic profit considers opportunity costs, while accounting profit does not
What is the purpose of understanding revenue and costs?
To make decisions about pricing and production strategies
What is the formula for calculating price elasticity of demand?
Percentage change in quantity demanded divided by the percentage change in price
What is the term for a good whose demand is relatively insensitive to price changes?
Inelastic demand
Which of the following factors makes demand more elastic?
Availability of substitutes
What is the term for a good whose quantity supplied is highly responsive to a change in price?
Elastic supply
What is the purpose of understanding cross elasticity of demand?
To identify the interdependencies between different products
What is the term for a good whose demand increases when consumer income decreases?
Inferior good
What is the main feature of globalization?
The increasing integration of economic systems across the globe
What is one cause of globalization?
The unrestricted flow of capital
What is the purpose of understanding elasticities in business?
To make informed decisions regarding pricing strategies and production levels
What is the result of multinational corporations operating in multiple countries?
Economic integration
What do relative prices in economics represent?
The value of a good or service in terms of another
Which of the following is a determinant of demand?
All of the above
What is the primary objective of most businesses in the economic framework?
Profit maximization
What happens to demand when the price of a substitute good increases?
Demand increases
What is the relationship between two goods when an increase in the price of one good leads to an increase in demand for the other?
Complements
What is the focus of the dynamics of markets?
The interaction between different market structures
What determines how resources are allocated in an economy?
Relative prices
What is the influence of supply and demand on relative prices?
Both supply and demand influence relative prices
What type of profit takes into account both explicit costs and opportunity costs?
Economic profit
What is the term for costs that do not vary with the level of output?
Fixed costs
What is the formula for calculating average fixed cost?
FC divided by Q
What occurs when a firm's output increases by a greater proportion than its inputs?
Increasing returns to scale
What is the term for the additional income from selling one more unit?
Marginal revenue
What is the purpose of calculating profit in business?
To determine if a business is making a surplus or loss
What is the main difference between the short run and the long run in terms of costs?
The time period
What is the term used to describe the responsiveness of quantity demanded to a change in price?
Price Elasticity of Demand
What is the term for the cost of producing one additional unit of output?
Marginal cost
When the elasticity of demand is greater than 1, what happens to the quantity demanded in response to a small price change?
It experiences a significant change
What is the purpose of calculating total revenue in business?
To determine the income from sales
What is the term for the break-even point where a business makes just enough profit to continue operating?
Normal profit
What is the characteristic of necessities in terms of price elasticity of demand?
They have inelastic demand
What is the term used to describe the responsiveness of quantity supplied to a change in price?
Price Elasticity of Supply
When the cross elasticity of demand is negative, what type of goods are involved?
Complementary goods
What is the impact of globalization on the movement of goods, services, capital, and labor?
It facilitates movement across national borders
What is the purpose of understanding elasticities in business and policy-making?
To make more informed decisions regarding pricing strategies and production levels
What is the characteristic of inferior goods in terms of income elasticity of demand?
They have negative income elasticity
What is one cause of globalization?
The unrestricted flow of capital
What is the impact of understanding elasticities on revenue and costs for businesses?
It helps businesses set prices that optimize revenue
What is a major environmental problem facing South Africa?
All of the above
What is the goal of sustainable environmental management?
To ensure natural resources are used in a manner that maintains their viability for future generations
What is a measure implemented by South Africa to combat environmental degradation?
All of the above
What is a consequence of climate change in South Africa?
More frequent extreme weather events
What is an initiative to reduce emissions in South Africa?
All of the above
What is a major contributor to land degradation in South Africa?
All of the above
What is a benefit of promoting eco-tourism in South Africa?
Conservation of natural resources
What is an international agreement that South Africa participates in?
Kyoto Treaty
What is a consequence of overpopulation in South Africa?
Urban sprawl and depletion of resources
What is a national strategy aimed at integrating sustainable practices in South Africa?
National Strategy for Sustainable Development
What is the primary driver of economic growth in a globalized economy?
Increased investment and business opportunities
What is a characteristic of multinational corporations?
Operating in multiple countries
What is the primary advantage of trade liberalization?
Encourages international trade and investment
What is a disadvantage of globalization?
Inequality between and within countries
What is the concept of comparative advantage based on?
Specializing in producing goods for which it has the lowest opportunity cost
What is the primary characteristic of the North-South Divide?
Socio-economic and political differences between developed and developing countries
What is the result of technological convergence?
Lowering the cost of operations and fostering innovation
What is the impact of globalization on the environment?
Environmental degradation due to increased industrial activity
What is the primary benefit of cultural exchange?
Enhances understanding and cooperation between different cultures
What is the purpose of understanding the effects of globalization?
To develop effective strategies to manage the effects of globalization
What is the main influence on consumer and producer decisions about what to buy or produce?
Relative prices
What type of relationship exists between goods whose demand increases when their prices decrease?
Substitutes
What is the primary focus of understanding the dynamics of markets?
Resource allocation
What is the result of an increase in the price of a good on its demand, assuming the good is elastic?
Demand decreases
What is the significance of understanding the relationship between cost, revenue, and profitability?
It is crucial for firm decision-making
What happens to supply when prices increase, assuming the good is elastic?
Supply increases
What is the term for the comparison of the cost of one good or service in terms of another?
Relative price
What is the primary objective of most businesses, according to the economic framework?
Profit maximization
What is the term used to describe the responsiveness of the quantity demanded of a good to a change in its price?
Price elasticity of demand
When is demand said to be inelastic?
When the elasticity is less than 1
What is the impact of an increase in consumer income on the demand for inferior goods?
Demand decreases
What is the term used to describe the integration and interdependence of economic, cultural, and political systems across the globe?
Globalization
What is the impact of an increase in the price of a substitute good on the demand for the original good?
Demand increases
What is the primary benefit of understanding price elasticity of demand for businesses?
To set prices that optimize revenue
What is the term used to describe the responsiveness of the quantity supplied to a change in price?
Price elasticity of supply
What is the impact of an increase in the price of a complementary good on the demand for the original good?
Demand decreases
What is the term used to describe the responsiveness of the quantity demanded of a good to a change in consumer income?
Income elasticity of demand
What is one of the main drivers of globalization?
Capital movement
What is the primary difference between accounting profit and economic profit?
Accounting profit excludes implicit costs, while economic profit includes them.
In the short run, what type of cost does not vary with the level of output?
Fixed cost
What is the purpose of calculating average fixed cost?
To understand the relationship between fixed costs and output
What occurs when a firm experiences increasing returns to scale?
Output increases by a greater proportion than inputs
What is the formula for calculating total revenue?
Price x Quantity
What is the primary purpose of calculating marginal revenue?
To identify the optimal level of production
What is the main difference between the short run and the long run in terms of costs?
In the short run, fixed costs are fixed, while in the long run, they are variable
What is the definition of normal profit?
The minimum profit a firm needs to sustain itself in the market
What is the purpose of calculating average variable cost?
To understand the relationship between variable costs and output
What is the term for the cost of producing one additional unit of output?
Marginal cost
What is the primary driver of economic growth in globalization?
Increased investment and business opportunities
What is the result of the removal of trade barriers in globalization?
Easier international trade and investment
What is the primary advantage of comparative advantage?
Specializes in producing goods for which it has the lowest opportunity cost
What is a characteristic of the North-South Divide?
Significant income gap between developed and developing countries
What is a primary concern of environmental sustainability?
Environmental degradation
What is the result of technological convergence in globalization?
Rapid advancements in technology contributing to lowering the cost of operations
What is a benefit of cultural exchange in globalization?
Enhances understanding and cooperation between different cultures
What is the primary reason for multinational corporations operating in multiple countries?
To exploit geographic advantages
What is a disadvantage of globalization?
Can increase economic disparities between and within countries
What is the result of trade liberalization?
Encourages international trade and investment
What is a major consequence of climate change in South Africa?
More frequent extreme weather events
What is a major contributor to land degradation in South Africa?
Deforestation and overgrazing
What is the main goal of sustainable environmental management?
To ensure natural resources are used in a way that maintains their viability for future generations
What is an initiative to reduce emissions in South Africa?
Improving public transportation
What is a national strategy aimed at integrating sustainable practices in South Africa?
National Strategy for Sustainable Development
What is a consequence of overpopulation in South Africa?
Depletion of resources like water
What is a major environmental impact of mining and industrial activities in South Africa?
Significant environmental pollution and health issues
What is an international agreement that South Africa participates in?
Kyoto Treaty
What is a benefit of promoting eco-tourism in South Africa?
Encouraging environmentally responsible and sustainable practices
What is a legal measure implemented by South Africa to combat environmental degradation?
National Environment Management Act
What is the main factor that influences consumer and producer decisions about what to buy or produce?
Relative prices
What is the result of an increase in the price of a substitute good?
Increased demand for the original good
What is the primary focus of the dynamics of markets in terms of cost and revenue?
Profit maximization
What is the effect of a decrease in the price of a complement good?
Increased demand for the original good
What determines how resources are allocated in an economy?
Relative prices
What is the likely effect of an increase in price on the supply of a good?
Increased supply
What is the relationship between the price of a good and its demand if the good is inelastic?
Higher prices lead to increased demand
Why is understanding the relationships between markets important in microeconomics?
To analyze how changes in one market affect others
Which of the following is NOT a major environmental issue in South Africa?
Water Scarcity
What is the primary goal of sustainable environmental management?
To maintain natural resources for future generations
Which of the following is an initiative to reduce emissions in South Africa?
Public Transportation and Vehicle Emissions
What does accounting profit not account for?
Implicit costs
What is a major consequence of climate change in South Africa?
Increased temperature and unpredictable rainfall patterns
What is the main cause of land degradation in South Africa?
Overgrazing and improper land use
What is the purpose of calculating marginal cost?
To make decisions about production levels
What is the purpose of the National Strategy for Sustainable Development in South Africa?
To integrate sustainable practices into various sectors of the economy
What is the difference between the short run and the long run in terms of costs?
In the short run, all costs are fixed, while in the long run, all costs are variable
What is an international agreement that South Africa participates in?
Kyoto Treaty
What is the primary driver of economic growth in globalization?
Increased Investment
What is the term for the minimum profit needed for sustainability?
Normal profit
What is the result of technological convergence in globalization?
Rapid advancements in technology
What is a major environmental impact of mining and industrial activities in South Africa?
Air pollution
What is the result of increasing the scale of production leading to a lower cost per unit?
Economies of scale
What is a characteristic of multinational corporations?
Exploiting geographic advantages
What is the formula for calculating total revenue?
Price x Quantity
What is the main concern of environmental sustainability?
Maintaining natural resources for future generations
What is the concept of comparative advantage based on?
Opportunity cost
What is a benefit of promoting eco-tourism in South Africa?
Promoting environmentally responsible tourism practices
What is the purpose of understanding revenue and costs?
To maximize profit
What is the term for the cost of producing one additional unit of output?
Marginal cost
What is the main implication of the North-South Divide?
Significant income gap between developed and developing countries
What is the concept that describes how the quantity demanded or supplied of a product changes in response to a price change?
Price elasticity
What is a major challenge to sustainable development in South Africa?
Environmental deterioration
What is the result of a firm's revenue exceeding its total cost?
Positive profit
What is the main benefit of trade liberalization?
Reduction of trade barriers
What is a characteristic of economic integration?
Standardization of laws and regulations
What is the main advantage of cultural exchange in globalization?
Enhanced understanding and cooperation between cultures
What is the result of technological advances in globalization?
Rapid innovation across global markets
What is the term for a good whose demand increases when its price decreases?
Elastic Good
What is the measure of how responsive the quantity supplied is to a change in price?
Price Elasticity of Supply
What is the term for the interdependencies between different products?
Cross Elasticity of Demand
What is the primary goal of understanding elasticity in economics?
To make informed decisions about pricing strategies
What is the term for the process by which businesses or other organizations develop international influence?
Globalization
What is the result of a high price elasticity of demand?
A small price change causes a large quantity change
What is the factor that makes demand more elastic?
Availability of substitutes
What is the term for a good whose demand decreases when income increases?
Inferior Good
What is the result of understanding price elasticity of supply?
Production level adjustments
What is the impact of globalization on businesses?
Increased competition
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