Principles of Microeconomics and Market Behavior Quiz

Test your knowledge on basic economic principles, demand laws, market structures, and more with this microeconomics quiz.

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Which of the following is a basic principle of economics?

Scarcity

Abundance

Unlimited resources

Unlimited wants

What does the law of demand state?

As price increases, demand decreases

As price increases, demand increases

As price decreases, demand increases

As price decreases, demand decreases

What is the primary focus of microeconomics?

Individual consumers and businesses

Government policies

Global economic trends

Environmental issues

What is the concept of 'opportunity cost'?

The cost of producing an additional unit of a good

The cost of forgoing the next best alternative

The cost of switching from one product to another

The cost of labor and materials

What is elasticity of demand?

The measure of how much the quantity demanded of a good responds to a change in price

The measure of how much the quantity supplied of a good responds to a change in price

The measure of how much consumers are willing to pay for a good

The measure of how much a producer is willing to produce of a good

What is a monopoly?

A market structure with many firms selling similar products

A market structure with only one seller of a particular product

A market structure with few firms selling differentiated products

A market structure with no barriers to entry or exit

What is a price ceiling?

A government-imposed maximum price that can be charged for a good or service

A government-imposed minimum price that must be charged for a good or service

A price set by the market with no government intervention

A price that is artificially lowered by firms in a competitive market

What is the formula for calculating price elasticity of demand?

Percentage change in quantity demanded divided by percentage change in price

Percentage change in price divided by percentage change in quantity demanded

Absolute change in quantity demanded divided by absolute change in price

Absolute change in price divided by absolute change in quantity demanded

What is the difference between 'normal goods' and 'inferior goods'?

Normal goods are always more expensive than inferior goods

Normal goods are of higher quality than inferior goods

Demand for normal goods increases with income, while demand for inferior goods decreases with income

Demand for normal goods decreases with income, while demand for inferior goods increases with income

#10

What is the difference between a change in quantity demanded and a change in demand?

A change in quantity demanded is caused by a change in price, while a change in demand is caused by a change in factors other than price

A change in quantity demanded is caused by a change in factors other than price, while a change in demand is caused by a change in price

A change in quantity demanded is a long-term change, while a change in demand is a short-term change

A change in quantity demanded is a short-term change, while a change in demand is a long-term change

#11

What is the law of diminishing marginal utility?

As a consumer consumes more of a good, the additional satisfaction gained from each additional unit of the good decreases

As a consumer consumes more of a good, the total satisfaction gained increases

As a consumer consumes more of a good, the price of the good decreases

As a consumer consumes more of a good, the demand for the good increases

#12

What is perfect competition?

A market structure with only one seller

A market structure with many firms selling differentiated products

A market structure with many firms selling identical products and no barriers to entry or exit

A market structure with few firms selling similar products

#13

What is a production possibility frontier?

A graph that shows the maximum combination of goods and services that can be produced given current resources and technology

A graph that shows the minimum combination of goods and services that must be produced to meet consumer demand

A graph that shows the maximum price that consumers are willing to pay for a good or service

A graph that shows the relationship between inflation and unemployment

#14

What is the difference between explicit costs and implicit costs?

Explicit costs are the costs of using self-owned resources, while implicit costs are the costs of using purchased resources

Explicit costs are the costs of using purchased resources, while implicit costs are the costs of using self-owned resources

Explicit costs are the costs of using resources for which a payment is made, while implicit costs are the costs of using resources for which no payment is made

Explicit costs are the costs of using resources for which no payment is made, while implicit costs are the costs of using resources for which a payment is made