1. Multiple-choice tests: a) Which of the following is an example of a market failure? A) Monopoly power B) Perfect competition C) Externalities D) Economic growth

b) The demand curve slopes downward because: A) Buyers’ incomes increase B) The price of substitutes decreases C) The price of complements increases D) Buyers’ tastes and preferences change

c) The opportunity cost of a decision is: A) The monetary cost of the decision B) The value of the next best alternative forgone C) The total cost of the decision D) The benefit of the decision

d) In the circular flow model, households are sellers in the: A) Product market B) Labor market C) Financial market D) Government market

1. Short-answer tests: a) Define inflation and provide an example of a situation that could lead to inflation.

b) Explain the concept of elasticity of demand and provide an example of a product with elastic demand.

c) Describe the difference between fiscal policy and monetary policy.

d) Identify and explain two factors that can shift the supply curve.

1. Essay tests: a) Discuss the impact of globalization on the economy.

b) Analyze the causes and consequences of income inequality.

c) Evaluate the effectiveness of government intervention in the economy.

d) Explain the concept of comparative advantage and its importance in international trade.

1. True/false tests: a) True or False: A decrease in the price of a good will always lead to an increase in quantity demanded.

b) True or False: The law of diminishing marginal utility states that as a consumer consumes more of a good, the additional satisfaction derived from each additional unit of the good decreases.

c) True or False: A progressive tax system means that individuals with higher incomes pay a higher percentage of their income in taxes.

d) True or False: The Federal Reserve is responsible for conducting fiscal policy in the United States.

1. Matching tests: Match the economic term with its definition: a) Gross Domestic Product (GDP) 1) The total value of all final goods and services produced within a country in a given period. b) Opportunity cost 2) The value of the next best alternative forgone when making a decision. c) Supply and demand 3) The interaction between buyers and sellers that determines the price and quantity of a good or service. d) Market equilibrium 4) The point at which the quantity demanded equals the quantity supplied in a market.

2. Fill in the blank: a) The law of ____ states that as the price of a good increases, the quantity demanded decreases, ceteris paribus.

b) ____ is the total value of all final goods and services produced within a country in a given period.

c) ____ is the measure of how responsive quantity demanded is to a change in price.

d) ____ is the difference between total revenue and total cost.

1. Completion: a) The ____ curve shows the relationship between the price of a good and the quantity demanded.

b) ____ is the study of how individuals, firms, and governments make choices to allocate scarce resources.

c) ____ is the total value of all final goods and services produced within a country in a given period.

d) ____ is the measure of how responsive quantity demanded is to a change in price.