JAMB UTME - Economics - 2008
Question 1 Report
The characteristic of entry and exit ensures that firms
Answer Details
The characteristic of entry and exit in a market ensures that firms earn normal profit in the long run. When a market is profitable, new firms will enter the market, hoping to take advantage of the profit opportunities. As a result, the supply of the product in the market increases, which causes the price of the product to decrease due to the excess supply. This, in turn, reduces the profit margin for each firm in the market. On the other hand, if the market is unprofitable, firms will exit the market, reducing the supply of the product. This reduction in supply causes the price of the product to increase due to the lower supply, which increases the profit margin for the remaining firms in the market. In both cases, the market reaches a state of equilibrium where firms earn normal profit, which is the minimum level of profit required to keep the firm operating in the long run. This means that firms can cover their costs of production, including opportunity costs, and earn a return that is equivalent to what they could earn in other industries with similar risk levels. Therefore, the characteristic of entry and exit ensures that firms in a market can earn normal profit, rather than excess profit or loss.
Question 2 Report
Use the data below to answer this questions
54, 36, 62, 79, 83, 36, 62, 42, 62, and 42.Calculate the mean?
Answer Details
Question 3 Report
A major trading problem facing ECOWAS is
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The major trading problem facing ECOWAS is the absence of a common currency. This makes it difficult to carry out transactions among member countries without the need for foreign exchange conversion, which increases transaction costs and hinders trade. A common currency would help to promote trade and integration within the region, increase price stability, and facilitate investment flows. It would also reduce the transaction costs associated with multiple currency exchanges, making it easier for businesses to trade across borders.
Question 4 Report
Which of the following producer is closest to being a monopolist?
Answer Details
A monopolist is a producer that has a significant amount of control over the supply and price of a particular product or service in a market. Based on this definition, the producer that is closest to being a monopolist is an automobile plant. Automobile plants typically produce a relatively small number of models of cars, and there are significant barriers to entry for new competitors due to the high costs of establishing manufacturing facilities and supply chains. As a result, automobile plants may have a significant degree of market power and control over the price of their cars. In contrast, a baker, a wheat farmer, and a large chain store are unlikely to be monopolists. Bakers and wheat farmers typically operate in highly competitive markets with many other producers, and large chain stores typically compete with other retailers in the same market. Therefore, an automobile plant is the producer that is closest to being a monopolist based on the degree of control it may have over the supply and price of its products in the market.
Question 5 Report
An upward movement along the same supply curve results in
Answer Details
An upward movement along the same supply curve results in an increase in quantity supplied. The supply curve shows the relationship between the price of a product and the quantity supplied by producers. When the price of a product increases, it becomes more profitable for producers to supply more of the product. As a result, producers increase the quantity of the product they supply to the market. Conversely, when the price of a product decreases, it becomes less profitable for producers to supply the product, and they may reduce the quantity supplied. Therefore, an upward movement along the same supply curve, which means a higher price, will result in an increase in the quantity supplied, which means that more of the product will be produced and supplied to the market.
Question 6 Report
Economic growth takes place when there is an increase in
Answer Details
Economic growth takes place when there is an increase in output over time. Output refers to the total amount of goods and services produced in an economy, also known as Gross Domestic Product (GDP). When an economy produces more goods and services, it can generate more income and create more jobs. This can lead to a higher standard of living for people in that economy. Savings and investment are important factors in supporting economic growth, but they are not the direct causes of growth. Savings can be used to finance investment, which can in turn increase output and stimulate growth. Population growth can also have an impact on economic growth, but it is not a direct cause. A growing population can create more demand for goods and services, which can increase output and stimulate growth. However, population growth can also put pressure on resources and lead to challenges such as unemployment and inequality. In summary, economic growth takes place when an economy produces more goods and services over time, which can be supported by savings, investment, and population growth.
Question 7 Report
A good indicator of economic development is an increase in
Answer Details
A good indicator of economic development is an increase in real per capita income. Real per capita income is the average income earned by individuals in a country after accounting for inflation and is calculated by dividing real national income by the country's population. When real per capita income increases, it indicates that the economic development of a country is improving because the country's population is able to consume more goods and services than before. This implies that there has been an increase in the country's production, employment, and income level, which ultimately contributes to the overall growth and development of the economy. Therefore, an increase in real per capita income is a good indicator of economic development because it reflects an improvement in the standard of living of the people in the country, which is one of the primary objectives of economic development.
Question 8 Report
The OPEC marketing policy of fixing minimum price allows members to
Answer Details
The OPEC (Organization of the Petroleum Exporting Countries) marketing policy of fixing a minimum price for oil allows its members to sell above the minimum price. This means that the members are not allowed to sell their oil below the minimum price, which is set by the organization. However, they are free to sell their oil above the minimum price, depending on the demand for their product in the market. By fixing the minimum price, OPEC aims to control the supply and demand for oil in the market and maintain stable prices. This allows its members to earn higher profits by selling their oil at a higher price, which can help to support their economies. The members do not have the freedom to determine the price and quantity to sell or negotiate the price with customers as they are bound by the minimum price set by the organization.
Question 9 Report
The theoretical relationship between money supply and prices is weakened by changes in the
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Question 10 Report
To protect farmers during a bumper harvest,. the government usually
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To protect farmers during a bumper harvest, the government usually sets a minimum price. A bumper harvest refers to a situation where farmers have produced more crops than the market demands, leading to a surplus. When there is a surplus, the prices of crops can drop, and farmers may not be able to sell their crops for a reasonable profit. This can lead to financial losses for farmers and discourage them from producing crops in the future. To prevent this situation, the government can set a minimum price that farmers must receive for their crops. By setting a minimum price, the government can ensure that farmers receive a fair price for their crops, and they are motivated to continue producing in the future. The government may also buy the excess crops from farmers and store them in a buffer stock. Later, when there is a shortage of crops in the market, the government can release the products from the buffer stock to stabilize the market price. In contrast, setting a maximum price may not be effective in protecting farmers during a bumper harvest. A maximum price limit would prevent the market price from rising above a certain level, which could discourage farmers from producing crops in the future. Similarly, selling the excess to consumers may not be practical, as it may lead to lower prices and lower profits for farmers.
Question 13 Report
If the standard deviation of a given data is 8.2, find its variance
Answer Details
To find the variance of a given data, we need to square the standard deviation. This is because variance is defined as the average of the squared differences from the mean. In this case, the standard deviation is given as 8.2. To find the variance, we simply square this value: Variance = (Standard deviation)^2 = 8.2^2 = 67.24 Therefore, the variance of the given data is 67.24. In summary, to find the variance of a given data, we square the standard deviation. In this case, since the standard deviation is given as 8.2, the variance is found by squaring 8.2, which gives a value of 67.24.
Question 14 Report
If the increase in the price of yams is used to estimate the inflation rate, this is an example of
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Question 15 Report
A major consideration in locating a cement factory is the availability of
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A major consideration in locating a cement factory is the availability of limestone. Limestone is the main raw material used in the production of cement. It is a sedimentary rock that is rich in calcium carbonate, which is the main ingredient in cement. Cement factories require a large supply of limestone in order to produce cement on a large scale. Therefore, the proximity of the factory to the limestone source is a major consideration in locating a cement factory. Other factors such as availability of skilled labor, power supply, and infrastructural facilities are also important, but the availability of limestone is a crucial factor that cannot be overlooked. In summary, the availability of limestone is an important factor in determining the location of a cement factory, as it is the main raw material used in the production of cement.
Question 16 Report
Contractionary monetary policy is used to
Answer Details
Contractionary monetary policy is used to control inflation. Inflation is the rate at which the general level of prices for goods and services is rising, resulting in a decline in the purchasing power of money. When inflation rises above a certain level, it can lead to negative consequences for the economy, such as a decrease in consumer purchasing power and a decrease in business investment. Contractionary monetary policy is a tool used by central banks to reduce inflation by decreasing the money supply and increasing interest rates. When the central bank reduces the money supply, it becomes more expensive for banks to borrow money, and they, in turn, charge higher interest rates on loans to consumers and businesses. This higher cost of borrowing reduces consumer and business spending, which helps to decrease demand for goods and services, and thus helps to reduce inflation. In summary, contractionary monetary policy is used to control inflation by reducing the money supply and increasing interest rates, which in turn reduces spending and helps to decrease inflation.
Question 17 Report
A high rent on land will affect the cost of producing maize
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A high rent on land will affect the cost of producing maize negatively. This is because land is an essential input for producing maize, and when the cost of renting or leasing land increases, the cost of production also increases. The cost of renting land is a fixed cost that is incurred regardless of the level of output or the stage of production. Therefore, the higher the rent on land, the higher the fixed cost of production. When the cost of production increases, it becomes more expensive for farmers to produce maize. As a result, the supply of maize in the market decreases, and the price of maize increases to compensate for the higher cost of production. This, in turn, reduces the quantity demanded by buyers who are not willing to pay the higher price, resulting in a reduction in the quantity of maize traded in the market. Therefore, a high rent on land will negatively affect the cost of producing maize by increasing the cost of production and reducing the supply and quantity of maize traded in the market.
Question 18 Report
The deregulation of telecommunication services in Nigeria is a characteristic of
Answer Details
The deregulation of telecommunication services in Nigeria is a characteristic of a market economy. In a market economy, the government allows the forces of demand and supply to determine prices, allocate resources, and regulate economic activities. Deregulation refers to the removal or reduction of government regulations or controls over an industry or sector. By deregulating the telecommunication sector, the Nigerian government allowed private companies to compete freely and set their prices, which increased efficiency and led to better services for consumers. This is a typical feature of a market economy where competition is encouraged, and the government does not interfere in the free play of market forces.
Question 19 Report
The economic policy of privatization came up as a result of the poor performance of
Answer Details
The economic policy of privatization came up as a result of the poor performance of public enterprises. Public enterprises are companies or organizations that are owned and operated by the government. In some cases, these enterprises were established to provide essential goods and services to the public, such as transportation or healthcare. However, over time, many public enterprises became inefficient and unprofitable, resulting in a strain on government resources and a decline in the quality of the goods and services they provided. Privatization is the process of transferring ownership and control of a public enterprise to private ownership, usually through the sale of shares to individuals or private companies. This policy was developed as a response to the poor performance of public enterprises, with the belief that private ownership and management would lead to increased efficiency, innovation, and profitability. Therefore, the poor performance of public enterprises is what led to the economic policy of privatization.
Question 20 Report
The activities in the oil and gas industry are classified into
Answer Details
The activities in the oil and gas industry are classified into upstream and downstream activities. Upstream activities involve exploration, discovery, and extraction of oil and gas resources from underground or underwater reservoirs. These activities include geological surveys, drilling exploration wells, testing the wells, and extracting the oil and gas from the reservoirs. Downstream activities involve the refining, transportation, and marketing of the extracted oil and gas products. These activities include refining crude oil into gasoline, diesel, and other products, transporting the products through pipelines, trucks, and ships, and marketing them to consumers. In summary, the activities in the oil and gas industry are classified into upstream and downstream activities. Upstream activities involve exploration, discovery, and extraction of oil and gas resources, while downstream activities involve the refining, transportation, and marketing of the extracted products.
Question 21 Report
The population of a country will decrease if
Answer Details
The population of a country will decrease if the death rate exceeds the birth rate. This means that the number of people dying in a given period of time is higher than the number of babies being born. For example, if a country has a birth rate of 10 babies per 1000 people per year and a death rate of 15 people per 1000 per year, the population will decrease. This is because more people are dying than are being born. Immigration being equal to emigration means that there is no net migration, which does not directly impact the population growth rate. Rapid economic growth may lead to an increase in population due to factors such as increased job opportunities and improved living standards, but it is not a direct cause of population decrease. Therefore, the correct answer is option A, the death rate exceeding the birth rate, which will lead to a decrease in population.
Question 22 Report
If the demand elasticity coefficient of cars is 0.5, it implies that the demand for petrol is
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Question 23 Report
The production possibility curve can be used to explain the underlying concepts of
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The production possibility curve shows the different combinations of two goods that can be produced using a fixed amount of resources and technology. By illustrating the trade-offs between producing one good versus another, it helps to explain the concept of opportunity cost, which is the cost of giving up one thing in order to produce something else. It also relates to the concept of choice, as the production possibility curve shows that choices must be made between different options, and the scale of preference, as it shows the different levels of production of two goods that can be produced given the same resources and technology. Therefore, the correct option is "opportunity cost and choice."
Question 24 Report
Diminishing marginal utility implies that
Answer Details
Diminishing marginal utility implies that as a person consumes more and more of a good or service, the additional satisfaction or utility that the person derives from each additional unit of the good or service decreases. In other words, the more you consume of something, the less additional satisfaction or pleasure you will receive from each additional unit. This is because the more you have of something, the less valuable each additional unit becomes to you. Therefore, the marginal utility of each additional unit consumed decreases as consumption increases.
Question 25 Report
If the required reserves of a bank is 20% and N10 000 is paid into its demand deposit account, what is the excess reserves?
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Question 27 Report
The excess benefit derived from the purchase of goods over the amount paid for them is referred to as consumer
Answer Details
The excess benefit derived from the purchase of goods over the amount paid for them is referred to as consumer surplus. It is a concept in economics that refers to the difference between the total amount that consumers are willing to pay for a good or service and the total amount that they actually pay. Consumer surplus is a measure of the net benefit or satisfaction that consumers receive from consuming a particular good or service. The higher the consumer surplus, the greater the satisfaction or utility that consumers derive from their purchases.
Question 28 Report
If the active population is 50 million and unemployed is 5 million what is the unemployment rate?
Answer Details
The unemployment rate can be calculated by dividing the number of unemployed individuals by the total labor force (active population). In this case, the active population is 50 million, and the number of unemployed individuals is 5 million. So, to calculate the unemployment rate, we divide the number of unemployed individuals (5 million) by the total labor force (50 million), and then multiply by 100 to convert the result into a percentage: Unemployment rate = (Number of unemployed / Total labor force) x 100 Plugging in the values, we get: Unemployment rate = (5 million / 50 million) x 100 Unemployment rate = 0.1 x 100 Unemployment rate = 10% Therefore, the unemployment rate is 10%, which means that out of the total labor force of 50 million, 5 million individuals are unemployed.
Question 29 Report
A major impediment to the development of agriculture in Nigeria is
Answer Details
A major impediment to the development of agriculture in Nigeria is the inadequate supply of farm inputs. Farm inputs are resources and materials that are used to cultivate crops or rear livestock. Examples of farm inputs include seeds, fertilizers, pesticides, and farm equipment. In Nigeria, the supply of these inputs is often limited, which can hinder the growth and development of the agricultural sector. Without access to adequate farm inputs, farmers may struggle to produce crops with high yields or quality. This can lead to a decline in agricultural productivity and income for farmers, which can in turn limit the growth and development of the sector as a whole. In addition, the limited supply of farm inputs can also contribute to food insecurity in the country, as farmers may not be able to produce enough food to meet the needs of the population. Therefore, the inadequate supply of farm inputs is a major impediment to the development of agriculture in Nigeria.
Question 31 Report
In a perfectly competitive condition, a firm uses 10 units of labour at N25 and 11 units at N36, what is the marginal cost of labour?
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Question 32 Report
The exports-promotion strategy is aimed at producing
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The exports-promotion strategy is aimed at producing more goods for exports. An exports-promotion strategy is a set of policies and actions designed to increase a country's exports. The goal of such a strategy is to boost economic growth, create jobs, and earn foreign exchange for the country. One of the main ways to achieve this is by producing more goods that can be exported to other countries. When a country produces more goods for export, it can increase its share of the global market and earn more foreign exchange. This can have a positive impact on the economy, as the increased foreign exchange can be used to import goods and services that the country may not be able to produce efficiently or to invest in infrastructure, education, and healthcare. While the exports-promotion strategy may also lead to the production of consumer goods originally imported or machinery for industries, the primary aim of the strategy is to increase exports. Therefore, producing more goods for domestic consumption may not be the focus of this strategy.
Question 33 Report
The use of government revenue and expenditure to achieve set objectives is known as
Answer Details
The use of government revenue and expenditure to achieve set objectives is known as fiscal policy. Fiscal policy is a government's use of spending and taxation to influence the economy. The government can use its revenue and expenditure to stimulate economic growth, control inflation, and manage the overall health of the economy. For example, if the government wants to stimulate economic growth, it can increase its spending on infrastructure projects such as building roads, bridges, and schools. This will create jobs, boost consumer spending, and increase demand for goods and services, which can lead to economic growth. On the other hand, if the government wants to control inflation, it can decrease its spending or increase taxes. This will reduce the amount of money available for consumers to spend, which can decrease demand and control inflation. Fiscal policy is an important tool used by governments to achieve their economic objectives, and it is often used in combination with other policies such as monetary policy to achieve the desired results.
Question 34 Report
Use the information below to answer this question.
Given that Q d = 20 - 4P and Q = 6P + 12If price is increased to N3, how much is the excess supply?
Answer Details
To determine the excess supply, we need to compare the quantity demanded (Qd) with the quantity supplied (Qs) at the given price. First, we need to find the equilibrium price, where Qd = Qs: Qd = 20 - 4P Qs = 6P + 12 Setting Qd equal to Qs and solving for P, we get: 20 - 4P = 6P + 12 8P = 8 P = 1 So the equilibrium price is N1. Now, if the price is increased to N3, we can find the new quantity demanded and supplied: Qd = 20 - 4P = 20 - 4(3) = 8 Qs = 6P + 12 = 6(3) + 12 = 30 At the new price of N3, the quantity demanded is 8 and the quantity supplied is 30. Since the quantity supplied is greater than the quantity demanded, we have excess supply. To find the amount of excess supply, we subtract the quantity demanded from the quantity supplied: Qs - Qd = 30 - 8 = 22 Therefore, the excess supply at the new price of N3 is 22.
Question 35 Report
If 100 units and units of commodity X are supplied at N80 at different times, it means that there is
Answer Details
If 100 units and units of commodity X are supplied at N80 at different times, it means that there is a change in the quantity supplied. A change in the quantity supplied refers to a movement along the supply curve due to a change in the price of the commodity. In this case, the price of commodity X is constant at N80, but the quantity supplied has changed from 100 units to some other amount (which is not specified in the question). It is important to note that a change in the quantity supplied is different from a change in supply. A change in supply refers to a shift in the entire supply curve, which can be caused by factors such as changes in production costs, technology, or government policies. In summary, if 100 units and units of commodity X are supplied at N80 at different times, it means that there is a change in the quantity supplied, which refers to a movement along the supply curve due to a change in the price of the commodity.
Question 36 Report
The use of modern weaving machines in the production of local fabric will result in
Answer Details
The use of modern weaving machines in the production of local fabric will result in a decrease in the demand for labor. This is because the modern machines are more efficient and can produce a larger quantity of fabric in a shorter amount of time, reducing the need for a large number of laborers. As a result, employers may reduce their workforce to cut down on labor costs. This could lead to a decrease in wages if the supply of labor exceeds the demand, as there would be more job seekers than available jobs, and employers would have the power to reduce wages.
Question 37 Report
The high rate of inflation in Nigeria can be attributed to
Answer Details
The high rate of inflation in Nigeria can be attributed to the increasing cost of production. This means that the cost of producing goods and services in Nigeria has been rising, which leads to an increase in prices of those goods and services. When the cost of production increases, businesses are forced to increase the prices of their goods and services in order to maintain their profit margins. This, in turn, leads to an increase in the general price level of goods and services in the economy, which is reflected as inflation. Therefore, as the cost of production continues to increase, inflation in Nigeria will likely continue to rise, unless measures are taken to address the underlying factors driving the rise in production costs. In summary, the high rate of inflation in Nigeria can be attributed to the increasing cost of production, which leads to an increase in the general price level of goods and services in the economy.
Question 39 Report
If income rises from N2000 to N4000 and quantity demanded increase from 80 units to 120 units, find the income elasticity of demand
Answer Details
The income elasticity of demand measures the responsiveness of quantity demanded of a good to a change in consumer income. It is calculated as the percentage change in quantity demanded divided by the percentage change in income. Using the information given, the initial quantity demanded is 80 units, and the final quantity demanded is 120 units, which represents a 50% increase. The initial income is N2000, and the final income is N4000, which represents a 100% increase. Therefore, the income elasticity of demand is (50%/100%) = 0.5. So, the correct option is: 0.5.
Question 40 Report
The active population of a country determines the size of its
Answer Details
The active population of a country determines the size of its labour force. The labour force of a country consists of all those individuals who are currently employed or actively seeking employment. It does not include individuals who are not actively seeking employment, such as students, retirees, or those who have given up on finding work. The labour force is an important determinant of a country's economic resources, as it represents the pool of available workers who can produce goods and services. The size of the labour force directly affects the level of national income and gross domestic product (GDP) of a country. National income is the sum of all income earned by a country's residents, including wages, salaries, profits, and taxes. GDP is the total value of all goods and services produced within a country's borders in a given period of time. In summary, the size of a country's active population, or labour force, is an important determinant of its economic resources, national income, and GDP.
Question 41 Report
From the graph above, point M shows that MC
Answer Details
From the graph, point M shows that the marginal cost (MC) is cutting the average cost (AC) at its minimum point. This means that the cost of producing each additional unit of output (MC) is equal to the average cost of producing each unit (AC) at the point where AC is at its lowest. In other words, at point M, the cost of producing one more unit of output is the same as the average cost of producing all the units up to that point. This indicates that the firm is operating at its most efficient level of production, where it is able to produce output at the lowest possible cost. In summary, point M shows that the marginal cost is cutting the average cost at its minimum point, indicating that the firm is operating at its most efficient level of production.
Question 42 Report
As long as marginal utility is positive, total utility must be
Answer Details
As long as marginal utility is positive, total utility must be increasing. Total utility is the overall amount of satisfaction or happiness that a person derives from consuming a certain amount of a product or service. Marginal utility, on the other hand, refers to the additional satisfaction that a person gains from consuming one more unit of the same product or service. If marginal utility is positive, it means that the additional satisfaction gained from consuming one more unit of the product is positive. This implies that the consumer's overall level of satisfaction is increasing as they consume more of the product. As a result, the total utility must also be increasing as the consumer consumes more of the product. Conversely, if the marginal utility is negative, it means that the additional satisfaction gained from consuming one more unit of the product is negative, which indicates that the consumer's overall satisfaction is decreasing as they consume more of the product. Therefore, as long as marginal utility is positive, the total utility must be increasing.
Question 44 Report
Use the data below to answer this questions
54, 36, 62, 79, 83, 36, 62, 42, 62, and 42.What is the modal score?
Answer Details
The modal score in a set of data is the number that appears most frequently. In this case, the set of data is 54, 36, 62, 79, 83, 36, 62, 42, 62, and 42. To find the modal score, we need to determine which number appears most frequently in the data set. From the data set, we can see that the numbers 62 and 36 both appear twice, while the numbers 54, 79, 83, and 42 each appear once. Since 62 and 36 appear more frequently than any other number in the data set, the modal score is either 62 or 36. However, since 62 appears more frequently than 36, the modal score is 62. Therefore, the modal score for the given data set is 62.
Question 45 Report
Use the information below to answer this question.
Given that Q d = 20 - 4P and Q = 6P + 12Determine the equilibrium quantity
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Question 46 Report
From the shaded area of the diagram above, an appropriate population policy will be to
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Question 47 Report
In the diagram above, there is an excess
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Yes, there is an excess in the diagram above. An excess, also known as a surplus, occurs when the quantity supplied exceeds the quantity demanded in a market. In the diagram, we can see that the supply of 40 units exceeds the demand of 30 units, which creates an excess of 10 units. This means that there are 10 units of the product that are not being sold and are left unsold in the market. On the other hand, we can also see that the demand for 20 units is being met by the supply of 20 units, which means that there is no excess or shortage of the product in this case.
Question 48 Report
A classroom teacher is promoted to the rank of a principal. This is an example of
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Question 49 Report
The output approach to measuring national income is based on the computation of
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Question 50 Report
One of the effects of instability in farmer's income in Nigeria is
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One of the effects of instability in farmers' income in Nigeria is rural-urban migration. When farmers are unable to earn a stable income from their agricultural activities, they may be forced to leave their farms and move to urban areas in search of alternative means of livelihood. This movement of people from rural to urban areas is known as rural-urban migration. It can lead to a number of social and economic challenges, including overcrowding, unemployment, and a strain on infrastructure in urban areas. When farmers leave their farms due to instability in their income, it can also lead to a decline in agricultural productivity and food security. This can further exacerbate the problem of rural-urban migration, as more people may be forced to leave rural areas in search of food and better economic opportunities. In summary, instability in farmers' income in Nigeria can lead to rural-urban migration, which can have negative social and economic consequences. It can also lead to a decline in agricultural productivity and food security, further exacerbating the problem of rural-urban migration.
