MICROECONOMICS EXAMINATION QUESTIONS AND CORRECT ANSWER WITH EXPLANATION GRADED A+ STUDY GUIDE SOUTHERN NEW HAMPSHIRE UNIVERSITY

MICROECONOMICS EXAMINATION QUESTIONS AND
CORRECT ANSWER WITH EXPLANATION GRADED A+
STUDY GUIDE SOUTHERN NEW HAMPSHIRE UNIVERSITY

1. Microeconomics studies:

A. Entire economy
B. Individual consumers and firms
C. Government policy only
D. International trade only
Answer: B
It focuses on individual decision-making units.



2. The basic unit of analysis in microeconomics is:

A. Nation
B. Household and firm
C. World economy
D. Central bank
Answer: B
It studies individuals and firms.



3. Demand refers to:

A. Desire only
B. Willingness and ability to buy goods
C. Production
D. Supply only
Answer: B
Demand includes ability to pay.



4. Law of demand states:

,A. Price ↑ demand ↑
B. Price ↑ demand ↓
C. Demand constant
D. Supply constant
Answer: B
Inverse relationship between price and demand.



5. Supply refers to:

A. Desire to buy
B. Quantity producers are willing to sell
C. Demand level
D. HR supply
Answer: B
It is producer behavior.



6. Law of supply states:

A. Price ↑ supply ↓
B. Price ↑ supply ↑
C. Supply constant
D. Demand constant
Answer: B
Direct relationship exists.



7. Equilibrium occurs when:

A. Demand > supply
B. Demand = supply
C. Supply > demand
D. No demand
Answer: B
Market clears.



8. Price elasticity of demand measures:

, A. Supply changes
B. Responsiveness of demand to price change
C. HR change
D. Cooking change
Answer: B
It measures sensitivity.



9. Perfect competition has:

A. One seller
B. Many buyers and sellers
C. No buyers
D. Government only
Answer: B
Many participants exist.



10. Monopoly is:

A. Many firms
B. One seller
C. Many buyers
D. No supply
Answer: B
Single seller dominates.



11. Oligopoly is:

A. One firm
B. Few large firms
C. Many firms
D. No firms
Answer: B
Few firms dominate market.



12. Consumer equilibrium means: