NumicornNumicornLearn, solve, progress

Microeconomics Practice Tests

These Grade 12 Social Studies practice tests develop Microeconomics skills through consumer choice, production, costs, market structures, labor markets, externalities, public goods, information problems, and efficiency.

Skills covered

  • Analyzing marginal utility, diminishing utility, budget constraints, normal goods, substitution, complements, utility maximization, consumer surplus, producer surplus, and demand shifts
  • Calculating and interpreting fixed, variable, total, marginal, and average costs, economies of scale, diminishing marginal product, short run, long run, explicit costs, and economic profit
  • Comparing price-taking firms, monopoly, oligopoly, monopolistic competition, profit maximization, price discrimination, cartels, deadweight loss, antitrust, and natural monopoly
  • Evaluating derived labor demand, marginal revenue product, minimum wage, monopsony, human capital, wage differentials, unions, discrimination, income inequality, and labor supply
  • Applying Pigouvian taxes, subsidies, Coase bargaining, free-rider problems, common resources, asymmetric information, adverse selection, moral hazard, tax incidence, and cap-and-trade

How to use these practice tests

Focus on the marginal change and the incentive it creates. Identify the relevant curve, cost, market structure, or external effect, then decide whether the outcome is efficient and who gains or bears the cost.

For more Grade 12 Social Studies practice, return to the Grade 12 Social Studies category.

Select a test

5 Tests
1. Test2. Test3. Test4. Test5. Test

4. Test

Grade 12 Microeconomics Practice Tests

Practice Grade 12 Social Studies questions about consumer choice, production, costs, market structures, labor markets, externalities, public goods, and information problems.

Choose the best answer. Identify the marginal change, incentive, market structure, cost, external effect, or information problem and evaluate efficiency.

10 Questions
0/10 Questions0 %
Correct 0
Incorrect 0
Unanswered 10
1. QuestionMultiple choice

Why is labor demand called derived demand?

Please select an answer first.

Correct answer: A

The correct answer is It comes from demand for the goods and services labor helps produce.

  1. Identify the microeconomics concept: Determine whether the question concerns consumer choice, production, costs, market structure, labor, externalities, information, or public goods.
  2. Apply the microeconomic model: A firm hires labor because workers contribute to production and sales, so demand for output influences demand for labor.
  3. Check incentives and efficiency: The correct answer is It comes from demand for the goods and services labor helps produce.

A firm hires labor because workers contribute to production and sales, so demand for output influences demand for labor.

2. QuestionMultiple choice

What is the marginal revenue product of labor?

Please select an answer first.

Correct answer: B

The correct answer is The additional revenue generated by employing one more unit of labor.

  1. Identify the microeconomics concept: Determine whether the question concerns consumer choice, production, costs, market structure, labor, externalities, information, or public goods.
  2. Apply the microeconomic model: Marginal revenue product equals the marginal product of labor multiplied by the marginal revenue from the additional output.
  3. Check incentives and efficiency: The correct answer is The additional revenue generated by employing one more unit of labor.

Marginal revenue product equals the marginal product of labor multiplied by the marginal revenue from the additional output.

3. QuestionMultiple choice

How can a binding minimum wage affect a competitive labor market?

Please select an answer first.

Correct answer: C

The correct answer is It can create a surplus of labor when set above the equilibrium wage.

  1. Identify the microeconomics concept: Determine whether the question concerns consumer choice, production, costs, market structure, labor, externalities, information, or public goods.
  2. Apply the microeconomic model: A binding wage floor raises the wage for covered workers but can reduce the quantity of labor demanded.
  3. Check incentives and efficiency: The correct answer is It can create a surplus of labor when set above the equilibrium wage.

A binding wage floor raises the wage for covered workers but can reduce the quantity of labor demanded.

4. QuestionMultiple choice

What is a monopsony?

Please select an answer first.

Correct answer: D

The correct answer is A labor market with one dominant buyer of labor.

  1. Identify the microeconomics concept: Determine whether the question concerns consumer choice, production, costs, market structure, labor, externalities, information, or public goods.
  2. Apply the microeconomic model: A monopsonist faces an upward-sloping labor supply and can influence wages and employment.
  3. Check incentives and efficiency: The correct answer is A labor market with one dominant buyer of labor.

A monopsonist faces an upward-sloping labor supply and can influence wages and employment.

5. QuestionMultiple choice

How does human capital affect labor markets?

Please select an answer first.

Correct answer: A

The correct answer is Education and training can increase productivity and potential wages.

  1. Identify the microeconomics concept: Determine whether the question concerns consumer choice, production, costs, market structure, labor, externalities, information, or public goods.
  2. Apply the microeconomic model: Human capital raises productive capacity and can affect earnings, mobility, and employment opportunities.
  3. Check incentives and efficiency: The correct answer is Education and training can increase productivity and potential wages.

Human capital raises productive capacity and can affect earnings, mobility, and employment opportunities.

6. QuestionMultiple choice

What is a compensating wage differential?

Please select an answer first.

Correct answer: B

The correct answer is A wage difference that compensates for differences in job conditions or nonwage benefits.

  1. Identify the microeconomics concept: Determine whether the question concerns consumer choice, production, costs, market structure, labor, externalities, information, or public goods.
  2. Apply the microeconomic model: Risk, flexibility, location, schedule, benefits, and working conditions can contribute to wage differences.
  3. Check incentives and efficiency: The correct answer is A wage difference that compensates for differences in job conditions or nonwage benefits.

Risk, flexibility, location, schedule, benefits, and working conditions can contribute to wage differences.

7. QuestionMultiple choice

What can a labor union do?

Please select an answer first.

Correct answer: C

The correct answer is Negotiate collectively over wages, hours, benefits, and working conditions.

  1. Identify the microeconomics concept: Determine whether the question concerns consumer choice, production, costs, market structure, labor, externalities, information, or public goods.
  2. Apply the microeconomic model: Collective bargaining increases worker negotiating power and can alter wages, employment, and workplace rules.
  3. Check incentives and efficiency: The correct answer is Negotiate collectively over wages, hours, benefits, and working conditions.

Collective bargaining increases worker negotiating power and can alter wages, employment, and workplace rules.

8. QuestionMultiple choice

What is employment discrimination?

Please select an answer first.

Correct answer: D

The correct answer is Unfair treatment in hiring, pay, promotion, or work conditions based on a protected characteristic.

  1. Identify the microeconomics concept: Determine whether the question concerns consumer choice, production, costs, market structure, labor, externalities, information, or public goods.
  2. Apply the microeconomic model: Discrimination can reduce opportunity and distort labor allocation; laws prohibit various forms of discrimination.
  3. Check incentives and efficiency: The correct answer is Unfair treatment in hiring, pay, promotion, or work conditions based on a protected characteristic.

Discrimination can reduce opportunity and distort labor allocation; laws prohibit various forms of discrimination.

9. QuestionMultiple choice

What is income inequality?

Please select an answer first.

Correct answer: A

The correct answer is An uneven distribution of income among people or households.

  1. Identify the microeconomics concept: Determine whether the question concerns consumer choice, production, costs, market structure, labor, externalities, information, or public goods.
  2. Apply the microeconomic model: Income inequality describes distribution, not simply whether average income or total output is high.
  3. Check incentives and efficiency: The correct answer is An uneven distribution of income among people or households.

Income inequality describes distribution, not simply whether average income or total output is high.

10. QuestionMultiple choice

What can increase labor supply for a particular occupation?

Please select an answer first.

Correct answer: B

The correct answer is Higher expected wages or improved working conditions, holding other factors constant.

  1. Identify the microeconomics concept: Determine whether the question concerns consumer choice, production, costs, market structure, labor, externalities, information, or public goods.
  2. Apply the microeconomic model: People compare the benefits and costs of work, so compensation, conditions, preferences, and available workers influence labor supply.
  3. Check incentives and efficiency: The correct answer is Higher expected wages or improved working conditions, holding other factors constant.

People compare the benefits and costs of work, so compensation, conditions, preferences, and available workers influence labor supply.

Previous testNext test