Economics 2014 JAMB Past Questions

Economics 2014 JAMB Past Questions

 

1. The choice of how to produce in a command economy is determined by

• A. government
• B. consumer
• C. industrialists
• D. labour unions

Correct Answer: Option A

2.In capitalist economies, questions about what to produce are ultimately answered by

• A. income level of households
• B. available technical skills in the economy
• C. output decisions of firms
• D. holding decision of households

Correct Answer: Option C

3. The best measure of dispersion to determine the tallest tree in a forest is

• A. range
• B. variance
• C. standard deviation
• D. mean deviation

Correct Answer: Option B

4. A change in demand for a normal goods implies that, there is a

• A. change in the quantity demanded as price changes
• B. shift in the demand curve
• C. movement along a given demand curve
• D. change in the price elasticity of demand

Correct Answer: Option D

5. If a 10% rise in price causes a 5% decrease in the quantity demanded of a commodity, the elasticity of demand is

• A. unitary elastic
• B. zero elastic
• C. elastic
• D. inelastic

Correct Answer: Option C

Explanation

In economics, the Total Revenue Test is a means for determining whether demand is elastic or inelastic. If an increase in price causes an increase in total revenue, then demand can be said to be inelastic, since the increase in price does not have a large impact on quantity demanded. If an increase in price causes a decrease in total revenue, then demand can be said to be elastic, since the increase in price has a large impact on quantity demanded.

 

6. A rightward shift of the budget line is caused by a

• A. fall in consumer income
• B. change in consumer taste
• C. fall in the commodity relative price
• D. rise in the commodity relative price

Correct Answer: Option D

7. Given the supply function P = 1/4(Qs+10) when P = N10, what is Qs?

• A. 20
• B. 15
• C. 50
• D. 30

Correct Answer: Option A

8. When price is set below equilibrium, this will lead to

• A. an increase in the quantity supplied
• B. a new equilibrium
• C. a decrease in the quantity supplied
• D. a fall in price

Correct Answer: Option D

9. Price mechanism determines the prices of commodities through

• A. auctioning
• B. market forces
• C. the sales of treasury bills
• D. government legislation

Correct Answer: Option B

10. If the production of a large firm is higher than that of a small firm, it is experiencing.

• A. external economies of scale
• B. external diseconomies of scale
• C. internal economies of scale
• D. internal diseconomies of scale

Correct Answer: Option C

11. Division of labour requires that, the tasks in a production line be performed

• A. by specialists
• B. in stages
• C. by all workers
• D. by unskilled labourers

Correct Answer: Option B

12. Given that FC = N500, VC = N1,500, and Q = 50 units. Find the average cost of the product.

• A. N30
• B. N40
• C. N10
• D. N20

Correct Answer: Option B

13. Rent and administrative expenses are examples of

• A. average fixed costs
• B. average variable costs
• C. fixed costs
• D. variable costs

Correct Answer: Option C

14. A perfect competitor will continue to expand output up to the point where

• A. TC > TR
• B. MR = AR
• C. MC < MR
• D. MC > MR

Correct Answer: Option C

15. One of the characteristics of a monopolist is that, he can influence

• A. quantity produced by other producers
• B. prices charged by other producers
• C. both price and quantity
• D. price or quantity

Correct Answer: Option C

16. A monopolist can boost up his revenue by

• A. adjusting both price and output upward
• B. reducing total output to match price
• C. increasing price
• D. reducing price

Correct Answer: Option B

17. Which of the following can be used to measure the Gross National product in an open economy?

• A. C+I+G+(X+M)
• B. C+I+G+X
• C. C+I+G
• D. C+I+G+(X-M)

Correct Answer: Option D

18. If MPC = 2/3 and investment is N100 million, the level of national income is

• A. N100 million
• B. N10 million
• C. N303 million
• D. N300 million

Correct Answer: Option D

19. The precautionary demand for money is determined by

• A. the rate of interest
• B. the level of savings
• C. the level of income
• D. general price level

Correct Answer: Option A

Explanation

The precautionary demand is dependent on the size of income, the availability of credit, and the rate of interest.

 

20. An inflation that co-exists with high rate of unemployment is

• A. hyperinflation
• B. stagflation
• C. demand-pull inflation
• D. cost-push inflation

Correct Answer: Option A

21. One of the challenges facing the banking industry in Nigeria is

• A. ensuring technological security
• B. providing employment
• C. providing loans for investment
• D. creating more money

Correct Answer: Option C

22. Short-term loans for investment are usually obtained through the

• A. stock market
• B. development banks
• C. money market
• D. capital market

Correct Answer: Option C

23 Given a base year and the price index of 175% the following year, which of the following year will arise?

• A. The cost of living decreases of that year
• B. The cost of living remains unchanged
• C. The value of money rises by 75%
• D. The value of money falls by 75%

Correct Answer: Option A

24. Wage freeze is a policy measure aimed at

• A. encouraging investors
• B. curbing inflation
• C. regulating standard of living
• D. curbing deflation

Correct Answer: Option B

25. A major obstacle to the development of Nigeria economy is

• A. low capital formation
• B. rural-urban migration
• C. over dependence on oil
• D. poor developmental policies

Correct Answer: Option D