Please refer to Chapter 1 Introduction to Micro Economics MCQ Class 12 Economics with answers below. These multiple-choice questions have been prepared based on the latest NCERT book for Class 12 Economics. Students should refer to MCQ Questions for Class 12 Economics with Answers to score more marks in Grade 12 Economics exams. Students should read the chapter Introduction to Micro Economics and then attempt the following objective questions.

MCQ Questions Class 12 Economics Chapter 1 Introduction to Micro Economics

Introduction to Micro Economics MCQ Class 12 Economics provided below covers all important topics given in this chapter. These MCQs will help you to properly prepare for exams.

Question. What is the main cause of all economic problems?      
(a) Abundance
(b) Convenience
(c) Scarcity
(d) None of these

Question. Scarcity requires that people must do which of the following things?
(a) Trade
(b) Cooperate
(c) Make choices
(d) Competition   

Question. The most fundamental economic problem is related to
(a) scarcity of resources
(b) unlimited human wants
(c) Both (a) and (b)
(d) Neither (a) nor (b) 

Question. Which of the following is/are true about an economy?
(a) It is the system of arrangement of all economic activities
(b) It is comprised of all the regions of a country
(c) Both (a) and (b)
(d) Neither (a) nor (b) 

Question. Which of the following is/are features of resources in an economy?
(a) Limited supply
(b) Alternative uses
(c) Both (a) and
(b) (d) None of these 

Question. According to Prof. Lionel Robbins, means are
(a) scarce
(b) unlimited
(c) undefined
(d) All of these 

Question. Which of the following is/are not the feature(s) of human wants?
(a) Limited
(b) Recurring
(c) Both (a) and (b)
(d) Neither (a) nor (b) 

Question. There are many economies in the world which are technologically advanced, these economies further focus upon development of latest technologies. In this way, these economies will be able to solve the economic problems once for all. Choose from the options below
(a) True
(b) False
(c) Partially true
(d) Incomplete statement 

Question. Which of is/are the reason/s for Economic problems?
(a) Scarcity of resources
(b) Alternative uses of resources
(c) Unlimited human wants
(d) All of the above   

Question. Which of the following are types of economic systems?
(a) Market Economy
(b) Planned Economy
(c) Mixed Economy
(d) All of these 

Question. Economics is the study of ……… .
(a) the choices we make because of scarcity of resources
(b) the allocation of resources only
(c) the distribution of surplus goods to those in need
(d) ways to reduce wants to eliminate the problem of scarcity 

Question. As an economic concept, scarcity applies to ……… .
(a) money but not time
(b) time but not money
(c) Both money and time
(d) Neither time nor money 

Question. The fact that people with higher incomes get to consume more goods and services addresses the … question.
(a) “When”
(b) “Where”
(c) “For whom”
(d) “How”   

Question. There are ……… central problems in an economy.
(a) two
(b) three
(c) four
(d) None of these   

Question. Which of the central problem is related to distribution of income?
(a) What to produce?
(b) How to produce?
(c) For whomto produce?
(d) None of these 

Question. In the production process, if goods worth ` 2,000 are produced by four factors of production, then labour will get ` 500. Choose from the options below.
(a) True
(b) False
(c) Partially true
(d) Incomplete statement   

Question. According to economic growth, production possibility curve will show       
(a) a downward shift
(b) an inward shift
(c) an outward shift
(d) No effect

Question. The scarce resources of an economy have       
(a) Competing usages
(b) Single usages
(c) Unlimited usages
(d) None of the above

Question. In free market economy, the allocation of resources is determined by           
(a) votes taken by consumers
(b) a central planning authority
(c) consumer preference
(d) the level of profits of firms

Question.Which of the following statements is false:           
(a) perfect competition involves many sellers of standardized products;
(b) monopolistic competition involves many sellers of homogeneous products;
(c) the oligopoly involves several producers of standardized or differentiated products;
(d) monopoly involves a single product for which there are no close substitutes.

Question. If a point falls inside the production possibility curve, what does it indicate ?
(a) Resources are over utilized
(b) Resources are under utilized
(c) There is employment in the economy
(d) Both (b) and (c)

Question. When was the famous book of Prof. Keynes published?         
(a) 1930
(b) 1931
(c) 1936
(d) 1940

Question. The total utility coincides with the marginal utility:         
(a) for the first unit consumed;
(b) only for the irrational consumer;
(c) at the level of the last unit consumed;
(d) at the saturation point.

Question. What is the shape of production possibility curve:         
(a) Concave to the origin
(b) Concave
(c) Straight line
(d) None of the above.

Question. Choice is created by the       
(a) abundance of resources
(b) urgency of needs
(c) non-availability of resources
(d) scarcity of resources

Question. Central problems of an economy includes.         
(a) What to produce
(b) How to produce
(c) For whom to produce
(d) All of the above

Question. ‘Economics is the study of mankind in the ordinary business of life’ . This definition was given by : –         
(a) Adam Smith
(b) Lord Robbins
(c) Alfred Marshall
(d) Samuelson

Question. Suppose the supply for product A is perfectly elastic. If the demand for this product increases:         
(a) the equilibrium price and quantity will increase;
(b) the equilibrium price and quantity will decrease;
(c) the equilibrium quantity will increase but the price will not change;
(d) the equilibrium price will increase but the quantity will not change.

Question. Which of the following statement is true?         
(a) Human wants are infinite
(b) Resources are limited
(c) Scarcity problem gives birth to choice .
(d) All of these

Question. From the national point of view which of the following indicates micro approach?             
(a) Per capita income of India.
(b) Underemployment in agricultural sector
(c) Lock out in TELCO
(d) Total savings in India.

Question. Which of the following is the salient feature of factors (or resources) ?
(a) These are limited as compared to wants
(b) These have alternative uses
(c) Both (a) and (b)
(d) None of the above

Question. The central problem of an economy is:
(a) What to produce ?
(b) How to produce ?
(c) How to distribute produced goods ?
(d) All of these

Question. Indian economy is:
(a) Centrally planned economy
(b) Market economy
(c) Mixed economy
(d) None of these.

Question. The branch of economic theory, that deals with the problem of allocation of resources is :
(a) Micro Economics
(b) Macro Economics
(c) Econometrics
(d) None of these

Question. Who used the word ‘micro’ for the first time:
(a) Marshall
(b) Boulding
(c) Keynes 
(d) Ragnar Frisch

Question. Positive economics involves statements which are ________.
(a) verifiable
(b) not verifiable
(c) may or may not be verified
(d) none of these

Question. The main objective of a socialist economy is…….
(a) Maximum production
(b) Economic freedom
(c) Earning profit
(d) Maximum public welfare

Question. Which of the following is not a factor of production ?
(a) Land
(b) Labour
(c) Money
(d) Capital

Question. In a free market economy, when consumers increase their purchase of a goods and the level of _______ exceeds _______ then prices tend to rise
(a) Demand, Supply
(b) Supply, Demand
(c) Prices, Demand
(d) Profits, Supply

Question. The reason for downward shape of production possibility curve is:
(a) Increasing opportunity cost
(b) Decreasing opportunity cost
(c) Same opportunity cost
(d) Negative opportunity cost

Question. Which of the following Is a branch of Micro Economics ?
(a) Product Price Determination
(b) Factor Price Determination
(c) Economic Welfare
(d) All of these

Question. Who said, “Economics is a science of wealth.”
(a) Marshall
(b) Robbins
(c) Adam Smith
(d) J.K. Mehta

Question. If a point falls inside the production possibility curve, what does it indicate?
(a) Resources are over-utilized
(b) Resources are underutilized
(c) There is employment in the economy
(d) Both (b) and (c)

Question. A study of how increase in the corporate income tax rate , will affect the natural unemployment rate is an example of :
(a) Macro Economics
(b) Descriptive Economics
(c) Micro Economics
(d) Normative Economics

Question. What do you mean by a mixed economy?
(a) Modern and traditional industries
(b) Public and private sectors
(c) Foreign and domestic investments
(d) Commercial and subsistence farming

Question. Which of the following is not a subject matter of microeconomics?             
(a) Pricing theory
(b) Monetary policy
(c) Market structure
(d) Consumer behavior

Question. Which of the following is studied under Micro Economics ?       
(a) Individual unit
(b) Economic Aggregate
(c) National Income
(d) None of these

Question. Which of the following is not a subject matter of microeconomics?         
(a) Pricing theory
(b) Monetary policy
(c) Market structure
(d) Consumer behavior

Question. Which point on the PPF shows a “productively efficient” level of output?           
(a) A
(b) B
(c) C
(d) All of the above

Question. Issues related to unemployment are studied at the _______.           
(a) micro-level
(b) macro-level
(c) micro as well as macro-level
(d) none of the above

Question. Under Inductive method, the logic proceeds from :       
(a) General to particulars
(b) Particular to general
(c) Both (a) and (b)
(d) None

Question. The branch of economic theory, that deals with the           
(a) problem of allocation of resources is :
(b) Micro Economics
(c) Macro Economics
(d) Econometrics
(d) None of these

Question. With an advancement in technology, the PPC will         
(a) Shift rightwards
(b) Shift leftwards
(c) Rotate on X-axis
(d) Rotate on Y-axis

Question. Economy may be classified as:           
(a) Capitalist
(b) Socialist
(c) Mixed
(d) All of these

Question. Which economy has a co-existence of private and public sectors ?         
(a) Capitalist
(b) Socialist
(c) Mixed
(d) None of these

Question. Which of the following can be considered as the basic features of public goods:
(a) are state-owned;
(b) are characterized by non-excludability and non-rivalry;
(c) are characterized by excludability and rivalry;
(d) may be positive or negative.

Question. Which of the following falls under microeconomics?             
(a) National income
(b) General price level
(c) Factor pricing
(d) National saving and investmen

Question. If the demand for agricultural products is inelastic:                   
(a) as the prices decrease, the revenues earned by producers increase;
(b) as the prices decrease, the revenues earned by producers decrease;
(c) rising prices do not lead to differentiation in producers’ incomes;
(d) the percentage decrease in prices is lower than the percentage increase in demand.

Question. According to whom, Economics is a science of human welfare ?           
(a) A Marshall
(b) Paul Samuelson
(c) J. S. Mill
(d) Adam Smith

Question. Which of the following is studied under Macro Economics ?           
(a) National Income
(b) Full. Employment
(c) Total Production
(d) All of these

Question. ‘Micros’, which means ‘Small’ belongs to:           
(a) Arabian word
(b) Greek word
(c) German word
(d) English word

Question. Which of the following features define human needs:             
(a) are not concurrent;
(b) do not disappear momentarily if they are satisfied;
(c) are unlimited in capacity;
(d) are unlimited in number.

Question. “Economics is a science of logic.’’ Who said it ?         
(a) Hicks
(b) Keynes
(c) Robbins
(d) Marshall

Question. Which is a central problem of an economy ?           
(a) Allocation of Resources
(b) Optimum Utilisation of Resources
(c) Economic Development
(d) All of these

Question. Which of the following falls under microeconomics?           
(a) National income
(b) General price level
(c) Factor pricing
(d) National saving and investment

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