JAMB Economics 2022

Marginal cost is?

A) The lowest cost of producing goods B) The cost of production of the most efficient firm in an industry C) The cost of production of the most inefficient firm in an industry D) The cost of production of the last or extra unit of goods produced by a firm

Correct Answer: D) The cost of production of the last or extra unit produced

The price mechanism

A) Regulates supply and demand B) Rations the consumers C) Rewards the producers D) Allocates scarce resources E) Does all of the above

Correct Answer: A) Regulates supply and demand

In a free market economy, the rationing of scarce goods is done principally by?

A) The government B) Business organizations C) The price mechanism D) Consumers

Correct Answer: C) The price mechanism

Scale of preference shows

A) Incomes of consumers in order of size B) Utilities enjoyed by consumers C) Opportunity cost of goods consumed D) Consumer's wants in order of priority

Correct Answer: D) Consumer's wants in order of priority

There is unemployment of resources when production is

A) Within the production possibility curve B) Outside the production possibility curve C) Along the production possibility curve D) Adequate to meet market demand

Correct Answer: A) Within the production possibility curve

A major characteristic of natural resources is they

A) Are unlimited in supply B) Have high cost of production C) Are free gifts of nature D) Do not command any price

Correct Answer: C) Are free gifts of nature

A major disadvantage of a capitalist economy is that it

A) Leads to low production of goods and services B) Requires large number of officials to operate C) Considers individual consumers' satisfaction D) Worsens income inequality among the citizens

Correct Answer: D) Worsens income inequality among the citizens

The mining sector contributes 60% to GDP. If GDP is $540, what is the mining sector's contribution?

A) $90.00 B) $180.00 C) $324.00 D) $350.00

Correct Answer: C) $324.00

The increase in demand for a commodity may decrease demand for another if both are

A) In complementary demand B) Of the same quality C) In composite demand D) In competitive demand

Correct Answer: D) In competitive demand

The demand curve for goods of ostentation is usually

A) Negatively sloped B) Positively sloped C) Vertical D) Horizontal

Correct Answer: B) Positively sloped

PN equals average revenue or marginal revenue curve of

A) An imperfect competitive firm B) A monopoly C) A perfectly competitive firm D) A monopolistic competitive firm

Correct Answer: C) A perfectly competitive firm

If the quantity demanded of a commodity increases from 20 units to 30 units when price increases from $4.00 to $5.00, the elasticity of demand is

A) 0.50 B) 0.65 C) 2.00 D) 2.50

Correct Answer: C) 2.00

The supply curve of a locally-produced good may shift to the right if

A) There is an increase in taxes on inputs B) Government increases subsidies C) Rural-urban migration is encouraged D) The price of the commodity increases

Correct Answer: C) Rural-urban migration is encouraged

In perfectly elastic supply, the supply curve

A) Is vertical B) Is horizontal C) Slopes upward D) Slopes downward

Correct Answer: B) Is horizontal

A country's budget allocation to various sectors of the economy is shown in the pie chart above. Use it to answer questions 15 and 16

If the country's budget is $7,200 and the pie chart shows Education receives one-third of the allocation, how much goes to Education?

A) $2,400.00 B) $2,000.00 C) $1,200.00 D) $1,000.00

Correct Answer: A) $2,400.00

what is the ratio of expenditure on Health to Agriculture?

A) 2:3 B) 3:4 C) 4:3 D) 5:4

Correct Answer: B) 3:4

A consumer of a single commodity is in equilibrium when

A) He equates his demand with price B) He equates marginal utility and price C) He equates marginal and total utilities D) His marginal utility equals zero

Correct Answer: B) He equates marginal utility and price

If the government imposes a minimum price on a commodity

A) Market surplus occurs B) Market will be cleared in the short-run C) Excess demand occurs D) Government regulation is no longer needed

Correct Answer: A) Market surplus occurs

A minimum price legislation is also called

A) Price ceiling B) Price floor C) Price control D) Price mechanism

Correct Answer: B) Price floor

Which of the following factors is not a cause of diminishing returns?

A) Increase in variable inputs B) Land fragmentation C) Constant technology D) Technological innovations

Correct Answer: D) Technological innovations

In manufacturing, division of labour may be hindered by

A) Excessive demand for the product B) Low level of technology C) Excess supply of labour D) Increase in the export of goods

Correct Answer: B) Low level of technology

The production cost that varies inversely with output is the

A) Total fixed cost B) Marginal cost C) Average fixed cost D) Average cost

Correct Answer: D) Average cost

A firm that closes down will still incur

A) Variable cost B) Fixed cost C) Total cost D) Marginal cost

Correct Answer: B) Fixed cost

The sufficient condition for a firm to be in equilibrium is that the

A) Firm must show that it is profitable B) Marginal cost must be equal to average revenue C) Marginal revenue curve is above the average revenue curve D) Marginal cost curve cuts the marginal revenue curve from below

Correct Answer: D) Marginal cost curve cuts the marginal revenue curve from below

Cooperative societies are formed mainly to

A) Assist producers to maximize their profits B) Encourage thrift and credit among members C) Promote and maintain the welfare of members D) Break the monopolies of private companies

Correct Answer: C) Promote and maintain the welfare of members

A disadvantage of a joint-stock company is

A) Unlimited liability B) Limited liability C) Lack of continuity when a shareholder dies D) Limited control in management by shareholders

Correct Answer: D) Limited control in management by shareholders

The middlemen is responsible for

A) Providing research facilities B) Purchasing raw materials C) Designing the product D) Breaking the bulk

Correct Answer: D) Breaking the bulk

A major function of the retailer is to

A) Grant credit to the wholesaler B) Break bulk and sell products in small units C) Reduce cost of distribution D) Generate demand for products through advertisement

Correct Answer: B) Break bulk and sell products in small units

A positive effect of a rapid population increase is

A) An excessive budget deficit B) A reduction in standard of living C) A wider market for goods and services D) A higher dependency ratio

Correct Answer: C) A wider market for goods and services

Which of the following factors may not affect the efficiency of labour?

A) Education and training B) Provision of welfare service C) Race and colour of workforce D) Quality of other factor inputs

Correct Answer: C) Race and colour of workforce

The type of unemployment found among workers who leave their jobs in search of other jobs is termed

A) Seasonal unemployment B) Structural unemployment C) Frictional unemployment D) Cyclical unemployment

Correct Answer: C) Frictional unemployment

The main objective of marketing boards is to

A) Accumulate revenue for government B) Educate farmers on pricing of cash crops C) Stabilize the incomes of cash crop farmers D) Provide warehousing facilities

Correct Answer: C) Stabilize the incomes of cash crop farmers

The point X inside the PPC indicates

A) Resources are fully utilized B) The country is poor C) Some resources are idle D) Resources are not available

Correct Answer: C) Some resources are idle

Which of the following industries will add more value to primary products?

A) Service industry B) Construction industry C) Mining industry D) Processing industry

Correct Answer: C) Mining industry

Gross National Product (GNP) less the provision for the wear and tear of assets is the

A) Net present value B) Net national product C) Net factor income D) Net indirect taxes

Correct Answer: B) Net national product

An example of transfer payments in national income accounting is

A) Money transferred to another country B) Unemployment allowance paid to the citizens C) The amount paid to a worker on transfer D) Transfer of funds from one bank to another

Correct Answer: B) Unemployment allowance paid to the citizens

Increasing national income without effective control of population size in a country can lead to

A) Higher per capita income B) Increase in poverty C) Increased outflow of aid D) Underutilization of resources

Correct Answer: D) Underutilization of resources

An example of commodity money is

A) Currency note B) Mobile money C) Cheques D) Silver

Correct Answer: D) Silver

If inflation is anticipated, people may

A) Save more money B) Spend more money C) Give out more loans D) Spend less money

Correct Answer: B) Spend more money

If the Central Bank increases its bank rate

A) Many banks will shut down their operations B) Customers will borrow more from banks C) The supply of money may be reduced D) Interest charges by banks will fall

Correct Answer: C) The supply of money may be reduced