The Ultimate Microeconomics Quiz!

54 Questions | Total Attempts: 136

SettingsSettingsSettings
Please wait...
Microeconomics Quizzes & Trivia

Even the smartest people out there in the field of economics have difficulty figuring out how to allocate scarce resources, and that’s because they look too hard at the big picture and don’t focus in on the fine details that you get when you study microeconomics. Take the following quiz on the topic and see just how much you know about it personally! Think you can achieve full marks?


Questions and Answers
  • 1. 
    Sometimes the government spends more or less, depending on the needs of the country. This statement best represents this economic concept:
    • A. 

      Resources should be used as efficiently as possible to achieve society's goals.

    • B. 

      When markets don't achieve efficiency, government intervention can improve society's welfare.

    • C. 

      Overall spending sometimes gets out of line with the economy's productive capacity.

    • D. 

      Government policies can change spending.

  • 2. 
    Lena and Jess are roommates. Lena hates to clean the bathroom. Jess will agree to clean the bathroom only if Lena vacuums the living room. This statement best represents this economic concept:
    • A. 

      The real cost of something is what you must give up to get it.

    • B. 

      “How much” is a decision at the margin.

    • C. 

      People usually exploit opportunities to make themselves better off.

    • D. 

      There are gains from trade.

  • 3. 
    Nate and Dylan are brothers. They have to mow the lawn and clean their rooms before they can go to the high school football game. Nate mows the lawn and Dylan picks up the rooms, and they make it to the football game on time. This statement best represents this economic concept:
    • A. 

      People usually exploit opportunities to make themselves better off.

    • B. 

      There are gains from trade.

    • C. 

      Markets usually lead to efficiency.

    • D. 

      One person's spending is another person's income.

  • 4. 
    Which of the following principles underlies the gains from trade?
    • A. 

      Resources are scarce.

    • B. 

      Marginal analysis is used for “how much” decisions.

    • C. 

      Resources should be used as efficiently as possible to achieve society's goals.

    • D. 

      People usually exploit opportunities to make themselves better off.

  • 5. 
    The federal government regulates how much carbon dioxide a factory can emit. This statement best represents this economic concept:
    • A. 

      Resources are scarce.

    • B. 

      “How much” is a decision at the margin.

    • C. 

      Markets usually lead to efficiency.

    • D. 

      When markets don't achieve efficiency, government intervention can improve society's welfare.

  • 6. 
    During the Great Depression, consumers and producers in the United States dramatically reduced their spending as compared to the quantity of goods and services available at the time. This statement best represents this economic concept:
    • A. 

      Resources are scarce.

    • B. 

      When markets don't achieve efficiency, government intervention can improve society's welfare.

    • C. 

      Overall spending sometimes gets out of line with the economy's productive capacity.

    • D. 

      Government policies can change spending.

  • 7. 
    A resource is
    • A. 

      Anything that can be used to produce something else.

    • B. 

      A sum of money used to start a business.

    • C. 

      A physical attribute of land.

    • D. 

      An intangible aspect of a society, such as its culture.

  • 8. 
    The opportunity cost of an item is
    • A. 

      Whatever is given up to obtain it.

    • B. 

      The monetary price paid.

    • C. 

      The monetary price paid, plus any interest.

    • D. 

      The monetary price paid, plus any taxes.

  • 9. 
    An economic system is in __________ when no individual would be better off by making a different choice.
    • A. 

      Chaos

    • B. 

      Decline

    • C. 

      Jeopardy

    • D. 

      Equilibrium

  • 10. 
    Making a trade-off at the margin means
    • A. 

      Making a decision without considering the alternatives.

    • B. 

      Comparing the costs and benefits of doing a little bit more of something versus doing a little bit less.

    • C. 

      Making a decision without considering the opportunity cost.

    • D. 

      Acquiring information that will help with a future decision.

  • 11. 
    Market failure results when the:
    • A. 

      Pursuit of individual self-interest leads to bad results for society as a whole.

    • B. 

      Market fails to create an equal distribution of wealth.

    • C. 

      Market fails to create an equal distribution of income.

    • D. 

      Market fails to eliminate scarcity.

  • 12. 
    Which of the following is a decision made at the margin?
    • A. 

      Penny and Emilio are deciding whether or not to get married.

    • B. 

      Natasha and Jake are deciding whether or not to buy a house.

    • C. 

      Theresa is deciding whether or not to join the military.

    • D. 

      Vincent is deciding how much to spend on an engagement ring.

  • 13. 
    If you choose to specialize in becoming a pharmacy, what gives you confidence that you will be able to purchase food, clothing, and shelter?
    • A. 

      The fact that there is no opportunity cost associated with your decision

    • B. 

      The fact that there is no trade-off associated with your decision

    • C. 

      The existence of government-provided consumer products

    • D. 

      The existence of markets

  • 14. 
    An efficient economy is one that
    • A. 

      Has eliminated scarcity.

    • B. 

      Does not face any trade-offs.

    • C. 

      Relies on a sense of civic duty, rather than incentives, to motivate its citizens.

    • D. 

      Has produced the maximum gains from trade made possible by its resources.

  • 15. 
    The incentives built into a market system tend to
    • A. 

      Lead to inefficient outcomes.

    • B. 

      Lead people to be self-sufficient, rather than to specialize.

    • C. 

      Prevent equilibrium outcomes.

    • D. 

      Ensure that resources are put to good use.

  • 16. 
    Your elderly grandma tells you: “I haven't been taking my beloved walks because I'm concerned about falling and getting hurt. See, there is always a cost to doing something. But if you don't do anything, then there is no cost.” Your grandma does not understand the concept of:
    • A. 

      Scarcity in economics.

    • B. 

      Efficiency in economics.

    • C. 

      Opportunity cost in economics.

    • D. 

      Marginal analysis in economics.

  • 17. 
    Marginal analysis:
    • A. 

      Refers to decisions about whether to do a bit more or a bit less of an activity.

    • B. 

      Helps when making a “how much” choice.

    • C. 

      Involves trade-offs.

    • D. 

      Refers to decisions about whether to do a bit more or a bit less of an activity, helps when making a “how much” choice, and involves trade-offs.

  • 18. 
    Twelve friends got together to celebrate a birthday. If the birthday cake is cut into 12 pieces of the same size and one slice is given to each of the 12 partygoers, this cake distribution is:
    • A. 

      Efficient but not equitable.

    • B. 

      Equitable but not efficient.

    • C. 

      Efficient and equitable.

    • D. 

      Equitable.

  • 19. 
    In Ventura County, California, strawberry production is limited by the number of acres available for agriculture production. This statement best represents this economic concept:
    • A. 

      Resources are scarce.

    • B. 

      “How much” is a decision at the margin.

    • C. 

      There are gains from trade.

    • D. 

      Resources should be used as efficiently as possible to achieve society's goals.

  • 20. 
    Fertilizer, used to grow pumpkins, is an example of a factor of production.
    • A. 

      True

    • B. 

      False

  • 21. 
    To achieve the gains from trade, each nation should specialize in the production of a good or service if:
    • A. 

      Its production possibility frontier is larger than that of any other country.

    • B. 

      Its production possibility frontier is smaller than that of any other country.

    • C. 

      The country can make the product using fewer resources than any other country.

    • D. 

      The country can make the product while forgoing fewer alternative products than any other country.

  • 22. 
    If the opportunity cost of manufacturing automobiles is lower in the United States than in Britain and the opportunity cost of manufacturing airplanes is higher in the United States than in Britain, then the United States will:
    • A. 

      Export both airplanes and automobiles to Britain.

    • B. 

      Import both airplanes and automobiles from Britain.

    • C. 

      Export airplanes to Britain and import automobiles from Britain.

    • D. 

      Import airplanes from Britain and export automobiles to Britain.

  • 23. 
    If the opportunity cost of manufacturing automobiles is higher in the United States than in Britain and the opportunity cost of manufacturing airplanes is lower in the United States than in Britain, then the United States will:
    • A. 

      Export both airplanes and automobiles to Britain.

    • B. 

      Import both airplanes and automobiles from Britain.

    • C. 

      Export airplanes to Britain and import automobiles from Britain.

    • D. 

      Import airplanes from Britain and export automobiles to Britain.

  • 24. 
    Which of the following is a normative statement?
    • A. 

      International trade leads to expanded consumption opportunities.

    • B. 

      Higher expenditures on health care will reduce infant mortality rates.

    • C. 

      We would all be better off if we could reduce our dependence on oil imports.

    • D. 

      Increased defense spending will lead to higher budget deficits.

  • 25. 
    Which of the following is an example of a positive statement?
    • A. 

      The poverty rate is 14%.

    • B. 

      A high rate of economic growth is good for the country.

    • C. 

      Everyone in the country needs to save money for retirement.

    • D. 

      Basketball players should not be paid higher salaries than teachers.