WGU - D089 Principles of Economics (Fully Updated
2026/2027) Exam Questions + Verified & Rationalized
Answers A+ Graded
301 QUESTIONS
TABLE OF CONTENTS
# TOPIC
1 Microeconomics
2 Macroeconomics
,Q1
The fundamental problem of economics is:
A) Inflation
B) Scarcity CORRECT
C) Unemployment
D) Recession
Rationale
Scarcity means unlimited wants exceed limited resources, forcing choices.
Q2
Opportunity cost is best defined as:
A) The money cost of a good
B) The value of the next best alternative forgone CORRECT
C) The total cost of production
D) The cost of all alternatives
Rationale
Opportunity cost is what you give up to get something else.
Q3
A production possibilities frontier (PPF) shows:
A) The maximum combinations of two goods an economy can produce CORRECT
B) The maximum combinations of two goods an economy can produce
C) The minimum cost of production
D) The demand for goods
Rationale
PPF illustrates trade-offs and efficient use of resources.
2
,Q4
A point inside the PPF indicates:
A) Efficient production
B) Inefficient production CORRECT
C) Unattainable production
D) Maximum production
Rationale
Inside the PPF means resources are underutilized or inefficiently allocated.
Q5
The law of demand states that, all else equal, as price rises:
A) Quantity demanded rises
B) Quantity demanded falls CORRECT
C) Demand rises
D) Supply falls
Rationale
There is an inverse relationship between price and quantity demanded.
Q6
A movement along the demand curve is caused by a change in:
A) Income
B) Price of the good CORRECT
C) Tastes
D) Price of related goods
Rationale
A change in the good's own price causes movement along the curve.
3
, Q7
A shift in the demand curve can be caused by:
A) A change in the good's price
B) A change in consumer income CORRECT
C) A change in the good's supply
D) A change in production technology
Rationale
Income changes shift demand; price changes move along the curve.
Q8
The law of supply states that, all else equal, as price rises:
A) Quantity supplied falls
B) Quantity supplied rises CORRECT
C) Supply falls
D) Demand rises
Rationale
Producers are willing to supply more at higher prices.
Q9
Market equilibrium occurs when:
A) Quantity demanded exceeds quantity supplied
B) Quantity demanded equals quantity supplied CORRECT
C) Quantity supplied exceeds quantity demanded
D) Price is zero
Rationale
Equilibrium is where the demand and supply curves intersect.
4
2026/2027) Exam Questions + Verified & Rationalized
Answers A+ Graded
301 QUESTIONS
TABLE OF CONTENTS
# TOPIC
1 Microeconomics
2 Macroeconomics
,Q1
The fundamental problem of economics is:
A) Inflation
B) Scarcity CORRECT
C) Unemployment
D) Recession
Rationale
Scarcity means unlimited wants exceed limited resources, forcing choices.
Q2
Opportunity cost is best defined as:
A) The money cost of a good
B) The value of the next best alternative forgone CORRECT
C) The total cost of production
D) The cost of all alternatives
Rationale
Opportunity cost is what you give up to get something else.
Q3
A production possibilities frontier (PPF) shows:
A) The maximum combinations of two goods an economy can produce CORRECT
B) The maximum combinations of two goods an economy can produce
C) The minimum cost of production
D) The demand for goods
Rationale
PPF illustrates trade-offs and efficient use of resources.
2
,Q4
A point inside the PPF indicates:
A) Efficient production
B) Inefficient production CORRECT
C) Unattainable production
D) Maximum production
Rationale
Inside the PPF means resources are underutilized or inefficiently allocated.
Q5
The law of demand states that, all else equal, as price rises:
A) Quantity demanded rises
B) Quantity demanded falls CORRECT
C) Demand rises
D) Supply falls
Rationale
There is an inverse relationship between price and quantity demanded.
Q6
A movement along the demand curve is caused by a change in:
A) Income
B) Price of the good CORRECT
C) Tastes
D) Price of related goods
Rationale
A change in the good's own price causes movement along the curve.
3
, Q7
A shift in the demand curve can be caused by:
A) A change in the good's price
B) A change in consumer income CORRECT
C) A change in the good's supply
D) A change in production technology
Rationale
Income changes shift demand; price changes move along the curve.
Q8
The law of supply states that, all else equal, as price rises:
A) Quantity supplied falls
B) Quantity supplied rises CORRECT
C) Supply falls
D) Demand rises
Rationale
Producers are willing to supply more at higher prices.
Q9
Market equilibrium occurs when:
A) Quantity demanded exceeds quantity supplied
B) Quantity demanded equals quantity supplied CORRECT
C) Quantity supplied exceeds quantity demanded
D) Price is zero
Rationale
Equilibrium is where the demand and supply curves intersect.
4
