Free Microeconomics MCQs with Answers

• A. a recession
• B. equilibrium
• C. equivalence
• D. abeyance

Explanation: Equilibrium occurs when the quantity supplied and quantity demanded are equal, leaving no inherent pressure for the market price to…

• A. everyone is called by a title
• B. the same as unemployment
• C. there is a decrease in polarization
• D. having theoretical knowledge in addition to training

Explanation: Professionalization involves specialized theoretical knowledge combined with practical training, usually leading to recognized expertise…

• A. Cultural and social
• B. Religious and educational
• C. Semantic and semitic
• D. Typically, American

Explanation: An economic institution is part of the wider social system and reflects a society's culture, including its norms about production…

• A. water space air
• B. earth wind fire
• C. animal vegetable object
• D. technology time efficiency

Explanation: Technology affects production methods, while time and efficiency affect how much output can be obtained from available resources.

• A. monopoly
• B. diversification
• C. planned obsolescence
• D. takeover attempt

Explanation: Buying a business in a different line of activity, such as a cigar company acquiring a pizza chain, is diversification.

• A. a free market for all
• B. oligopoly
• C. government control
• D. none of the above

Explanation: An oligopoly exists when a small number of powerful firms dominate an industry, so each firm's decisions affect its major rivals.

• A. gold and silver
• B. the means of production machines tools materials
• C. serfs
• D. precious spices

Explanation: Industrialisation made productive capital such as machines, tools and materials more important than land as the basis of ownership and…

• A. production depends on supply and demand
• B. consumers create demand
• C. producers supply what is demanded
• D. all of the above

Explanation: Consumer sovereignty means that consumer demand guides what firms produce, while producers respond by supplying the goods consumers want.

• A. Public
• B. Private
• C. Communal
• D. Indian

Explanation: Clan land that members may use but cannot individually sell is held by the group rather than by the state or one private person.

• A. the amount of each commodity that can be produced given available resources
• B. unlimited production of one commodity
• C. limitless output of commodities
• D. none of the above

Explanation: The production possibilities frontier shows the maximum attainable combinations of two goods with given resources and technology.

• A. land
• B. capital
• C. labor
• D. time

Explanation: Land as a factor of production includes naturally occurring resources and material objects, such as soil, forests and minerals.

• A. must always be limited
• B. maintains and fuels demand
• C. is not a factor
• D. is viewed unfavorably

Explanation: In industrial economies, consumption creates demand for goods and services, encouraging firms to continue production and investment.

• A. truth
• B. property
• C. happiness
• D. justice

Explanation: The concept of property determines who may own, control and use resources, so it strongly shapes an economic system.

• A. median
• B. mode
• C. moot
• D. mean

Explanation: Adding all observations and dividing by their number gives the arithmetic mean, commonly called the average.

• A. a feature of Adam Smith,s Wealth of Nations
• B. the belief God exhibited by the Puritans
• C. the fact that prayer results in help
• D. a belief in ghosts prevalent in the early Middle Ages

Explanation: Adam Smith used the “invisible hand” in The Wealth of Nations to describe how individuals pursuing their own interests can unintentionally…

• A. create abuse
• B. stimulate government control
• C. stimulate economic growth as each individual tried to maximize profits
• D. stifle economic growth as the markets would be flooded with merchandise

Explanation: Smith argued that private ownership gives individuals an incentive to pursue profit, and competition can direct those efforts toward…

• A. Differential association
• B. Anomie
• C. Labeling theory
• D. Gang imitation theory

Explanation: Differential association holds that deviant behavior is learned through interaction with others who model or support it.

• A. chemotherapy
• B. hypnotherapy
• C. shock therapy
• D. behavior therapy

Explanation: Behavior therapy treats problematic behavior by conditioning responses through rewards, punishments, and reinforcement.

• A. lack of legitimate means to attain group goals
• B. mental retardation
• C. neurosis
• D. wild mood swings

Explanation: For Merton, anomie arises when society promotes goals but access to legitimate means of achieving them is unequal or blocked.

• A. neurosis
• B. psychosis
• C. halitosis
• D. prognosis

Explanation: Neurosis is an emotional or psychological disorder in which contact with reality and ordinary functioning are generally retained.