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Basic Microeconomics

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Home > Teaching Business English > Business English Lessons, Advanced Level # 128

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A crucial concept in understanding microeconomics is that of utility: utility is how much a product pleases people.

Correct answer: (d) crucial

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Marginal utility is how much every incremental quantity of a product pleases; it tends to drop as the numbers of a product consumed increases.

Correct answer: (d) incremental

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Consumers choose what products they want to buy by comparing something's price and its utility.

Correct answer: (b) price

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They will pick the product that gives them the biggest bang for the buck, the product that gives them the greatest satisfaction for every unit of money spent.

Correct answer: (a) bang

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Based on the law of demand, quantity demanded is inversely related to price.

Correct answer: (c) related

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'Perfect competition' is defined as economic forces at work, uninterrupted by any other force.

Correct answer: (b) at work

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In reality, no such thing as a true perfectly competitive market exists; there are other types of market structures, however — monopoly, oligopoly, and monopolistic competition.

Correct answer: (c) such

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In monopolistic competition, there are many firms vying for control of one market.

Correct answer: (d) vying

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Oligopoly is a small number of competing firms, so the key property of oligopolies is that all firms execute strategic planning.

Correct answer: (d) execute

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Some oligopolies act as cartels, in which many firms act as one.

Correct answer: (a) as one

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