80 Economic Theories Trivia Questions with Answers
80 public questions with answers, drawn from the well. How many can you answer?
Economic theories trivia examines the models, laws, hypotheses, theorems, and paradoxes economists use to explain decisions, markets, growth, voting, banking, trade, and resource use. Questions include Prospect Theory, the Laffer Curve, the cobweb model, the Efficient Market Hypothesis, and the Diamond-Dybvig model of bank runs.
The collection is well suited to economics students, university review sessions, pub quizzes, and intellectually focused game nights. It includes foundational ideas and influential named concepts, from factor-price equalization and Arrow’s impossibility theorem to the Jevons paradox, where efficiency gains can contribute to greater total resource consumption.
Which hypothesis in financial economics asserts that asset prices fully incorporate all available information?
Answer
Efficient-market hypothesis
Which model of bank runs was published by Douglas Diamond and Philip Dybvig in 1983?
Answer
Diamond-Dybvig model
Which theorem says free trade equalizes factor prices under specific assumptions?
Answer
Factor price equalization
Which paradox says efficiency gains can increase total resource consumption?
Answer
Jevons paradox
Which theory explains rising relative costs in labor-intensive services with slow productivity growth?
Answer
Baumol's cost disease
Which hypothesis says tax cuts may not raise demand if people expect future taxes?
Answer
Ricardian equivalence
Which model extends IS-LM analysis to an open economy?
Answer
Mundell-Fleming model
Which curve shows an inverse relationship between unemployment and wage inflation?
Answer
Phillips curve
Which curve proposes that inequality first rises and then falls as income grows?
Answer
Kuznets curve
Which economist is associated with the theory of creative destruction?
Answer
Joseph Schumpeter
Which 1899 book introduced the term conspicuous consumption?
Answer
The Theory of the Leisure Class
Which economist introduced the idea of comparative advantage in an 1817 book?
Answer
David Ricardo
Which theory argues that economic crises arise from class conflict and capital accumulation?
Answer
Marxian economics
Which economist is most associated with monetarism?
Answer
Milton Friedman
Which economic theory links money supply growth to inflation in the long run?
Answer
Quantity theory of money
Which school of thought argued that land was the source of all wealth?
Answer
Physiocracy
Which theory says countries gain by specializing where they have the lowest opportunity cost?
Answer
Comparative advantage
Who published The Wealth of Nations in 1776?
Answer
Adam Smith
Which 1936 book is the founding text of Keynesian macroeconomics?
Answer
The General Theory
What theory states that if one optimal condition is not met, achieving other optimal conditions may not improve welfare?
Answer
Theory of the second best
What macroeconomic theory attributes business cycles to real shocks, such as changes in technology or productivity?
Answer
Real business cycle theory
What theorem predicts that in a majority-rule election, the outcome matches the preference of the median voter?
Answer
Median voter theorem
What branch of economics applies economic analysis to political decision-making?
Answer
Public choice theory
What theory suggests that paying workers above-market wages can increase productivity and reduce turnover?
Answer
Efficiency wage theory
Which trade theory posits that countries export goods using their abundant factors of production?
Answer
Heckscher-Ohlin model
What theory describes how individuals overuse a shared resource for their own benefit, leading to depletion?
Answer
Tragedy of the commons
What theory predicts that exchange rates adjust so that identical goods cost the same in different countries?
Answer
Purchasing power parity
What law states that adding more of one input while holding others fixed eventually yields smaller increases in output?
Answer
Law of diminishing returns
What economic theory posits that supply creates its own demand?
Answer
Say's law
What monetary law states that bad money drives out good money?
Answer
Gresham's law
What theorem in international trade predicts that protectionism benefits the scarce factor of production?
Answer
Stolper-Samuelson theorem
Economic Theories trivia — quick answers
What are good economic theories trivia questions?
Good questions focus on named theories and models, including Prospect Theory, the Laffer Curve, the cobweb model, the Efficient Market Hypothesis, the Diamond-Dybvig bank-run model, the Heckscher-Ohlin factor-price theorems, Arrow’s impossibility theorem, and the Jevons paradox.
How hard is economic theories trivia?
Economic theories trivia is generally moderate to advanced. The questions often depend on recognizing economists’ names, model titles, and precise claims rather than recalling broad economic themes. It is especially suitable for students and players comfortable with economics terminology.
What is Prospect Theory?
Prospect Theory, developed by Daniel Kahneman and Amos Tversky, describes how people make decisions under risk. It proposes that people evaluate gains and losses relative to a reference point, typically experience losses more intensely than equivalent gains, and may make inconsistent choices depending on how options are framed.
What does the Efficient Market Hypothesis say?
The Efficient Market Hypothesis says that asset prices reflect available information. In its strongest interpretation, publicly available information is rapidly incorporated into prices, making it difficult for investors to consistently earn risk-adjusted excess returns using information already known to the market.
What is Arrow’s impossibility theorem?
Arrow’s impossibility theorem states that no ranked voting system can satisfy a specified set of fairness conditions simultaneously when there are three or more alternatives. The result shows that converting individual preferences into one collective ranking involves unavoidable trade-offs under those assumptions.