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Free Microeconomics MCQs with Answers

1,742 Microeconomics MCQs from Economics, each with the correct answer and a written explanation of why it is correct. Free and unlimited, with no account needed.

Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.

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1,742 questions · page 45 of 88

881. A company is in the ________ stage of the new product development process when the company develops the product concept into a physical product in order to assure that the product idea can be turned into a workable product ?

  • A. product development
  • B. commercialization
  • C. marketing strategy
  • D. business analysis

Explanation: During product development, the firm turns an approved product concept into a physical prototype or workable product and tests its…

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Correct answer: product development

882. If Mark Mars pays Hershey Foods Corporation for the right to use their name on his line of T-shirts then Mr. Mars is using which type of branding ?

  • A. Licensed brands
  • B. Manufacturer's brand
  • C. Private brand
  • D. Co-brand

Explanation: Using Hershey's name on another product in return for payment is licensing, so the resulting brand is a licensed brand.

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Correct answer: Licensed brands

883. All of the following factors can affect the attractiveness of a market segment EXCEPT ?

  • A. the presence of many strong and aggressive competitors
  • B. the likelihood of government monitoring
  • C. actual or potential substitute products
  • D. the power of buyers in the segments

Explanation: Competitive rivalry, substitute products, and buyer power are standard forces affecting a market segment’s attractiveness.

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Correct answer: the likelihood of government monitoring

884. If a government uses barriers to foreign products such as biases against a foreign company's bids or product standards that go against a foreign company's product features the government is using ?

  • A. Protectionism
  • B. exchange controls
  • C. exchange facilitators
  • D. nontariff trade barriers

Explanation: Nontariff trade barriers restrict imports without using an ordinary customs tariff, including discriminatory standards and biased…

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Correct answer: nontariff trade barriers

885. If an advertiser wants flexibility timeliness good local market coverage broad acceptability, and high believability the advertiser will probably choose which of the following mass media types ?

  • A. Newspapers
  • B. Television
  • C. Direct Mail
  • D. Radio

Explanation: Newspapers provide flexibility, quick publication, strong local coverage, broad acceptance, and relatively high believability.

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Correct answer: Newspapers

886. __________ has the advantage of being high in selectivity low cost; immediacy; and interactive capabilities?

  • A. Direct Mail
  • B. Outdoor
  • C. Online
  • D. Radio

Explanation: Online advertising combines precise audience targeting with relatively low cost, instant delivery, and two-way interaction.

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Correct answer: Online

887. The place in the business buying behavior model where interpersonal and individual influences might interact is called the ?

  • A. environment
  • B. response
  • C. stimuli
  • D. buying center

Explanation: The buying center is the group within an organization whose members influence the purchase decision, allowing interpersonal and individual…

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Correct answer: buying center

888. The type of trade promotion discount in which manufacturers agree to reduce the price to the retailer in exchange for the retailer's agreement to feature the manufacturer's products is some way is called a(n) ?

  • A. discount
  • B. allowance
  • C. premium
  • D. rebate

Explanation: A trade allowance is a price reduction offered to a retailer for performing a promotional activity, such as featuring the manufacturer's…

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Correct answer: allowance

889. If your company were to make a product such as a suit of clothes and sold that product to a retailer your company would have sold to the __________ merket?

  • A. reseller
  • B. business
  • C. government
  • D. service

Explanation: A retailer buys products for resale, so the transaction is made in the reseller market.

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Correct answer: reseller

890. Given recent information about growth trends and growth potential of ethnic populations within the U.S market which of the following ethnic groups would be a best bet to double during the next half century and become one of the U.S market's most viable segments ?

  • A. Hispanics and Asians
  • B. African Americans
  • C. Western Europeans
  • D. Middle Eastern

Explanation: Hispanic and Asian populations were projected in standard U.S. marketing texts to grow rapidly and become highly important market…

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Correct answer: Hispanics and Asians

891. Catalog marketing is big business in the United States. The average house hold receives __________ catalogs per year?

  • A. 25
  • B. 50
  • C. 75
  • D. 100

Explanation: The commonly cited textbook estimate is that an average U.S. household receives about 50 catalogs annually.

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Correct answer: 50

892. The fact that services cannot be stored for later use or sale is evidence of their ?

  • A. intangibility
  • B. inseparability
  • C. variability
  • D. perishability

Explanation: Perishability means a service cannot be stored, inventoried, or saved for later sale or use.

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Correct answer: perishability

893. When a company reviews sales costs and profit projections for a new product to find out whether these factors satisfy the company's objectives they are in which of the following new process development stages ?

  • A. Concept development and testing
  • B. Commercialization
  • C. Business analysis
  • D. Marketing strategy development

Explanation: Business analysis evaluates projected sales, costs, and profits to determine whether a product fits the firm's objectives.

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Correct answer: Business analysis

894. If a consumer describes a car as being the most economical car on the market than this descriptor is a?

  • A. rule
  • B. attitude
  • C. belief
  • D. cute

Explanation: Calling a car the most economical expresses a consumer's specific conviction about the product, which is a belief.

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Correct answer: belief

895. __________ is a philosophy holding that a company's marketing should support the best long-run performance of the marketing system?

  • A. Enlightened marketing
  • B. Myopic marketing
  • C. Fundamental marketing
  • D. Conceptual marketing

Explanation: Enlightened marketing balances customer satisfaction, company goals, and society’s long-run welfare, so it aims to improve the overall…

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Correct answer: Enlightened marketing

896. The primary reason that many companies work to become the low cost producers in their industry is because ?

  • A. they can generate more advertising
  • B. they can please top management
  • C. they can gain tax advantages
  • D. they can set lower prices that that result in greater sales and profits

Explanation: A low-cost producer can reduce prices while preserving profit margins, attracting more buyers and increasing sales.

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Correct answer: they can set lower prices that that result in greater sales and profits

897. All of the following are criticisms leveled against marketing by critics EXCEPT ?

  • A. harming consumers through high prices
  • B. harming consumers through deceptive practices
  • C. harming consumers through high-pressure selling
  • D. harming consumers through too many product choices

Explanation: High prices, deceptive practices, and high-pressure selling are standard criticisms of marketing because they may exploit or mislead…

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Correct answer: harming consumers through too many product choices

898. A price reduction to buyers who buy in large volumes is called a(n) ?

  • A. quantity discount
  • B. cash discount
  • C. seasonal discount
  • D. trade discount

Explanation: A quantity discount reduces the per-unit price when a buyer purchases a large volume.

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Correct answer: quantity discount

899. A company's compensation plan should reflect its overall marketing strategy For example if the overall strategy is to grow rapidly and gain market share the compensation plan should reward ?

  • A. loyalty and perseverance
  • B. spot selling and old product rejuvenation
  • C. high sales performance and encourage capturing new accounts
  • D. high pressure situations and competitive reaction

Explanation: A rapid-growth strategy requires salespeople to increase current sales while opening new accounts and expanding market share.

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Correct answer: high sales performance and encourage capturing new accounts

900. In a example discussed in your text Johnson & Johnson's recall of their Tylenol product following the discovery that several bottles of Tyloenol had been laced with cyanide is consistent with which business philosophy ?

  • A. The marketing concept
  • B. The product concept
  • C. The selling concept
  • D. The societal marketing concept

Explanation: The Tylenol recall placed consumer safety above immediate sales and profit, reflecting the societal marketing concept.

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Correct answer: The societal marketing concept
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