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Business & EconomicsHard

Famous Economic Theories and Economists

Adam Smith and the invisible hand, Marx and class struggle, Friedman and monetarism, Schumpeter and creative destruction, Ricardo and comparative advantage. 20 questions for real econ readers.

20

Questions

4

Minutes

Tip: Use keys 1-4 to answer quickly

The 20 quiz questions

Question 1 : Which Scottish economist is considered the father of modern economics with his work "The Wealth of Nations"?

Possible answers:

  • Adam Smith
  • John Stuart Mill
  • Thomas Malthus
  • David Ricardo

Explanation: Adam Smith (1723-1790) published "The Wealth of Nations" in 1776, laying the foundations of market economy and the "invisible hand" concept.

Question 2 : Which German thinker developed the theory of class struggle and criticized capitalism in "Das Kapital"?

Possible answers:

  • Georg Hegel
  • Friedrich Engels
  • Max Weber
  • Karl Marx

Explanation: Karl Marx (1818-1883) analyzed capitalism and predicted its replacement by socialism then communism in his major work "Das Kapital".

Question 3 : Which American economist is the leader of monetarism and a critic of Keynesianism?

Possible answers:

  • Paul Samuelson
  • Alan Greenspan
  • Milton Friedman
  • John Kenneth Galbraith

Explanation: Milton Friedman (1912-2006), Nobel laureate 1976, advocated for money supply control and free markets, influencing Reagan and Thatcher.

Question 4 : What economic concept describes the process of "creative destruction" theorized by Joseph Schumpeter?

Possible answers:

  • The nationalization of companies
  • Monetary devaluation
  • Innovation replacing obsolete industries
  • Company merger

Explanation: Schumpeter's creative destruction describes how innovation destroys old economic structures to create new ones, driving capitalism forward.

Question 5 : Which economist formulated the law of comparative advantage in international trade?

Possible answers:

  • Adam Smith
  • Jean-Baptiste Say
  • David Ricardo
  • John Stuart Mill

Explanation: David Ricardo (1772-1823) demonstrated that even a less efficient country in all areas benefits from specializing in what it does relatively best.

Question 6 : Which economic theory states that "supply creates its own demand"?

Possible answers:

  • La loi de Say
  • La loi de Pareto
  • La loi de Gresham
  • La loi de Walras

Explanation: Say's Law, formulated by Jean-Baptiste Say (1767-1832), states that production generates income that allows purchasing that production.

Question 7 : Which Austrian economist, Keynes's rival, defended liberalism in "The Road to Serfdom"?

Possible answers:

  • Murray Rothbard
  • Friedrich Hayek
  • Carl Menger
  • Ludwig von Mises

Explanation: Friedrich Hayek (1899-1992), Nobel laureate 1974, criticized state intervention and defended free markets as guarantors of freedom.

Question 8 : What concept describes the situation where 20% of causes produce 80% of effects?

Possible answers:

  • The Phillips curve
  • L'effet Veblen
  • The Pareto principle
  • La loi de Goodhart

Explanation: The Pareto Principle (or 80/20 rule), observed by Vilfredo Pareto, shows that wealth and effort distribution often follows this ratio.

Question 9 : Which curve illustrates the inverse relationship between inflation and unemployment in the short term?

Possible answers:

  • The Phillips curve
  • La courbe IS-LM
  • La courbe de Lorenz
  • La courbe de Laffer

Explanation: The Phillips Curve, proposed by A.W. Phillips in 1958, shows that low inflation often accompanies high unemployment and vice versa.

Question 10 : Which economist theorized state intervention to stimulate the economy during crises?

Possible answers:

  • Friedrich Hayek
  • Milton Friedman
  • John Maynard Keynes
  • Adam Smith

Explanation: John Maynard Keynes (1883-1946) revolutionized economic thought with his "General Theory" (1936), advocating state intervention and stimulus through public spending during recessions.

Question 11 : Which theory suggests that beyond a certain threshold, raising taxes reduces tax revenue?

Possible answers:

  • La courbe de Lorenz
  • The Gini coefficient
  • The multiplier effect
  • La courbe de Laffer

Explanation: The Laffer Curve, popularized by Arthur Laffer, shows that an excessively high tax rate discourages economic activity and reduces revenue.

Question 12 : Which French economist received the 2014 Nobel Prize for his work on market regulation?

Possible answers:

  • Jean Tirole
  • Esther Duflo
  • Maurice Allais
  • Thomas Piketty

Explanation: Jean Tirole was awarded for his analysis of market power and regulation, particularly in network industries and oligopolies.

Question 13 : Which Keynesian concept describes the increase in income generated by an initial expenditure?

Possible answers:

  • L'effet d'éviction
  • The multiplier effect
  • L'effet de richesse
  • The liquidity trap

Explanation: The multiplier effect shows that a €100 expenditure can generate more than €100 in total income as money circulates and is re-spent multiple times.

Question 14 : Which economist developed the theory of rational expectations, challenging Keynesianism?

Possible answers:

  • James Tobin
  • Robert Lucas
  • Franco Modigliani
  • Gary Becker

Explanation: Robert Lucas, Nobel laureate 1995, showed that economic agents anticipate government policies, limiting their effectiveness.

Question 15 : Which economist theorized that population growth exceeds that of food resources?

Possible answers:

  • Thomas Malthus
  • Jeremy Bentham
  • Nassau Senior
  • David Ricardo

Explanation: Thomas Malthus (1766-1834) predicted in his "Essay on the Principle of Population" that overpopulation would lead to famines and wars.

Question 16 : Which French-American economist received the 2019 Nobel Prize for her work on poverty?

Possible answers:

  • Elinor Ostrom
  • Esther Duflo
  • Claudia Goldin
  • Janet Yellen

Explanation: Esther Duflo, along with Abhijit Banerjee and Michael Kremer, was awarded for her experimental approach to fighting global poverty.

Question 17 : What concept describes the situation where "bad" money drives "good" money out of circulation?

Possible answers:

  • Gibson's paradox
  • La loi de Say
  • La loi de Gresham
  • L'effet Cantillon

Explanation: Gresham's Law, attributed to Thomas Gresham in the 16th century, explains that people hoard valuable coins and spend the less valuable ones.

Question 18 : Which economist analyzed wealth inequality in "Capital in the Twenty-First Century"?

Possible answers:

  • Amartya Sen
  • Paul Krugman
  • Joseph Stiglitz
  • Thomas Piketty

Explanation: Thomas Piketty, French economist, showed that the return on capital exceeds economic growth, mechanically widening inequalities.

Question 19 : Which economist introduced the concept of "opportunity cost" in economic analysis?

Possible answers:

  • Eugen von Böhm-Bawerk
  • Léon Walras
  • Carl Menger
  • Friedrich von Wieser

Explanation: Friedrich von Wieser, Austrian economist, formalized opportunity cost: the cost of what is given up when making an economic choice.

Question 20 : Which economic theory states that markets naturally tend toward general equilibrium?

Possible answers:

  • Le modèle IS-LM
  • La théorie des jeux
  • The quantity theory of money
  • Walras's general equilibrium

Explanation: Léon Walras (1834-1910) developed general equilibrium theory, showing how all markets balance simultaneously through prices.

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