ECO 211 – Principles of
Microeconomics Exam With Actual
Questions & Verified Answers,Plus
Rationales/Expert Verified For
Guaranteed Pass /2026 /Latest
Update/Instant Download Pdf
1. Microeconomics is primarily concerned with
A. national income determination
B. inflation and unemployment
C. individual economic units and markets
D. international trade balances
Answer: C
Microeconomics studies the behavior and decisions of
individual consumers, firms, and specific markets rather than
the economy as a whole.
2. Scarcity exists because
A. resources are unlimited
B. wants are limited
C. resources are limited relative to wants
D. governments restrict production
Answer: C
Scarcity arises from the imbalance between unlimited human
wants and limited economic resources.
,3. Opportunity cost is best defined as
A. total monetary cost of production
B. value of the next best alternative forgone
C. accounting cost minus profit
D. fixed cost plus variable cost
Answer: B
Opportunity cost measures what must be given up when a
choice is made.
4. Which of the following is a positive economic statement?
A. The government should raise taxes
B. Minimum wage laws are unfair
C. Higher prices reduce quantity demanded
D. Income inequality is a serious problem
Answer: C
Positive statements describe relationships that can be tested
using facts and data.
5. The law of demand states that, ceteris paribus,
A. price and quantity demanded move together
B. price and quantity supplied move together
C. price and quantity demanded move inversely
D. income and demand always increase
Answer: C
When price rises, quantity demanded falls, assuming all other
factors remain constant.
6. Which factor does NOT shift the demand curve?
A. Consumer income
B. Price of related goods
C. Consumer tastes
D. Price of the good itself
, Answer: D
A change in the good’s own price causes movement along the
demand curve, not a shift.
7. An inferior good is one for which demand
A. increases as income increases
B. decreases as income increases
C. is unaffected by income
D. depends only on price
Answer: B
Consumers buy less of an inferior good as their income rises.
8. Which situation illustrates an increase in demand?
A. Higher price leads to less quantity demanded
B. Lower income reduces purchases
C. Improved consumer tastes increase purchases at all prices
D. Increase in price causes consumers to buy less
Answer: C
An increase in demand means consumers want more at every
price.
9. The law of supply states that, ceteris paribus,
A. higher prices lead to lower quantity supplied
B. lower prices lead to higher quantity supplied
C. price and quantity supplied are inversely related
D. price and quantity supplied are directly related
Answer: D
Firms are willing to supply more when prices rise because
profits increase.
10. Which factor shifts the supply curve?
A. Change in the price of the good
B. Change in production technology
Microeconomics Exam With Actual
Questions & Verified Answers,Plus
Rationales/Expert Verified For
Guaranteed Pass /2026 /Latest
Update/Instant Download Pdf
1. Microeconomics is primarily concerned with
A. national income determination
B. inflation and unemployment
C. individual economic units and markets
D. international trade balances
Answer: C
Microeconomics studies the behavior and decisions of
individual consumers, firms, and specific markets rather than
the economy as a whole.
2. Scarcity exists because
A. resources are unlimited
B. wants are limited
C. resources are limited relative to wants
D. governments restrict production
Answer: C
Scarcity arises from the imbalance between unlimited human
wants and limited economic resources.
,3. Opportunity cost is best defined as
A. total monetary cost of production
B. value of the next best alternative forgone
C. accounting cost minus profit
D. fixed cost plus variable cost
Answer: B
Opportunity cost measures what must be given up when a
choice is made.
4. Which of the following is a positive economic statement?
A. The government should raise taxes
B. Minimum wage laws are unfair
C. Higher prices reduce quantity demanded
D. Income inequality is a serious problem
Answer: C
Positive statements describe relationships that can be tested
using facts and data.
5. The law of demand states that, ceteris paribus,
A. price and quantity demanded move together
B. price and quantity supplied move together
C. price and quantity demanded move inversely
D. income and demand always increase
Answer: C
When price rises, quantity demanded falls, assuming all other
factors remain constant.
6. Which factor does NOT shift the demand curve?
A. Consumer income
B. Price of related goods
C. Consumer tastes
D. Price of the good itself
, Answer: D
A change in the good’s own price causes movement along the
demand curve, not a shift.
7. An inferior good is one for which demand
A. increases as income increases
B. decreases as income increases
C. is unaffected by income
D. depends only on price
Answer: B
Consumers buy less of an inferior good as their income rises.
8. Which situation illustrates an increase in demand?
A. Higher price leads to less quantity demanded
B. Lower income reduces purchases
C. Improved consumer tastes increase purchases at all prices
D. Increase in price causes consumers to buy less
Answer: C
An increase in demand means consumers want more at every
price.
9. The law of supply states that, ceteris paribus,
A. higher prices lead to lower quantity supplied
B. lower prices lead to higher quantity supplied
C. price and quantity supplied are inversely related
D. price and quantity supplied are directly related
Answer: D
Firms are willing to supply more when prices rise because
profits increase.
10. Which factor shifts the supply curve?
A. Change in the price of the good
B. Change in production technology
