JAMB UTME - Economics - 2019

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The reason why the average curve and the marginal curve are U-shaped in the short-run and flatter in the long-run is due to economies of scale. Economies of scale refer to the cost advantages that firms experience as they increase their production output. In the short-run, firms are often operating at less than their optimal capacity and therefore may experience diseconomies of scale as they increase output, which leads to higher average costs and a U-shaped average curve. Meanwhile, the marginal cost curve intersects the average cost curve at its minimum point, which is why it is also U-shaped in the short-run. However, in the long-run, firms have more time to adjust their inputs and can increase the scale of their operations. As they do so, they can experience economies of scale, which lead to lower average costs and a flatter average curve. This means that the marginal cost curve intersects the average cost curve at a lower point than in the short-run, making it flatter. Overall, this illustrates how economies of scale can affect a firm's production costs and how this can be reflected in the shape of the average and marginal cost curves.

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The quantity demanded (Qd) of a commodity is related to its price (P) through the equation Qd = 80 - 2P. So, if we know the price of the commodity, we can use this equation to find the quantity demanded. In this case, the price is given as ₦3. So, we can plug in this value of price into the equation to find the quantity demanded: Qd = 80 - 2P Qd = 80 - 2 * 3 Qd = 80 - 6 Qd = 74 Therefore, the quantity demanded when the price is ₦3 is 74 units.

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The money market equilibrium is defined as when the demand and supply of money are equal. In other words, the amount of money people want to hold (demand) is equal to the amount of money available (supply). Think of the money market as a marketplace where people buy and sell money. Just like any other market, when there is high demand for a product, its price (in this case, the interest rate) will increase. When there is low demand, the price (interest rate) will decrease. In the money market, the interest rate is a measure of the cost of borrowing money. If there is a high demand for money, people are willing to pay a higher interest rate to borrow it. This results in an increase in the interest rate. On the other hand, if there is low demand for money, people are not willing to pay a high interest rate, and the interest rate decreases. When the demand and supply of money are equal, the interest rate will be at the level where the quantity of money that people want to hold is equal to the amount of money available. This is the money market equilibrium.

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In the short-run, a monopoly can make abnormal profit. Abnormal profit is a profit that is higher than the normal profit a company would make in a competitive market. This is because a monopoly has market power, meaning it has control over the price of its product and can set it higher than the market price, leading to higher profits. However, it's important to note that this situation is only temporary and in the long-run, competition and other factors can drive down prices and eliminate the abnormal profit.

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The last link in the channel of distribution is the Consumer. The channel of distribution refers to the path that a product takes from the producer to the final customer. The producer creates the product, and it is then sold to a wholesaler, who sells it to a retailer, and finally, the retailer sells it to the consumer. The consumer is the end user of the product and is the last link in the chain of distribution. In other words, the consumer is the person who ultimately buys the product and uses it for their own purposes. The channel of distribution is important because it helps to ensure that the product reaches the end user in a timely and efficient manner.

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"Good government planning" is not a cause of unemployment. Unemployment refers to the situation where individuals who are actively seeking employment are unable to find work. The causes of unemployment can be complex and multi-faceted, but typically include factors such as a lack of available jobs, poor education and lack of relevant skills, and corruption. "Good government planning" is not a direct cause of unemployment, but it can have an indirect effect by helping to create a favorable economic environment that supports job growth and job creation. For example, good government planning can help to attract businesses to an area, provide funding for education and training programs, and reduce corruption, all of which can help to reduce unemployment over time.

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Most of the national debt is "dead weight" in the sense that it is not covered by any real asset. This means that the debt is not backed up by any tangible property or valuable resource. Instead, it is simply a financial obligation that the government owes to its creditors, who have loaned the government money. The government must pay back this debt with interest, which can add up over time and become a burden on the economy. This type of debt is sometimes referred to as "dead weight" because it does not contribute to the growth or development of the economy, but instead represents a financial obligation that must be met.

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Secondary production refers to the process of transforming raw materials into finished goods, typically in a factory setting. Out of the four options, only one involves transforming raw materials into finished goods in a factory setting, and that is option II, an automobile assembly-line worker. A bricklayer (option I) works in construction and is not involved in transforming raw materials into finished goods in a factory setting. An accountant (option III) works in the service sector and is not involved in producing goods. A cinema projectionist (option IV) is also not involved in producing goods but rather in providing a service. Therefore, the answer is option II, an automobile assembly-line worker.

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When the supply of a commodity increases, it means that there is more of that commodity available in the market than before. This increase in supply causes the market to shift, leading to a change in the equilibrium price and quantity of that commodity. As the supply of the commodity increases, sellers will want to sell more of the commodity, but buyers may not want to buy as much at the higher price. This creates a surplus, where there is more supply than demand, causing the price to decrease. As the price decreases, buyers are more willing to buy the commodity, and sellers may reduce the amount they are willing to sell, until the market reaches a new equilibrium. This new equilibrium will have a lower price and a higher quantity bought and sold than before the increase in supply. Therefore, the correct answer is: a decrease in the equilibrium price and an increase in the equilibrium quantity bought and sold.

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An import quota is a permit that allows an importer to bring a certain quantity of foreign goods into a country. It is a government-imposed limit on the quantity of a certain good that can be imported into a country during a specific period of time. The purpose of an import quota is to protect domestic producers and limit the amount of foreign competition in the domestic market. The government sets the quota to regulate the flow of goods into the country and to ensure that domestic producers are not overwhelmed by foreign competition.

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A contractionary monetary policy is used to control inflation. Inflation is a sustained increase in the general price level of goods and services in an economy over time. It occurs when there is too much money chasing too few goods, leading to an increase in demand and upward pressure on prices. A contractionary monetary policy is a type of economic policy used by central banks to reduce the money supply and increase the cost of borrowing, with the aim of slowing down the economy and reducing inflationary pressures. This can be achieved through several measures, such as raising interest rates, increasing reserve requirements for banks, and selling government securities in the open market. By reducing the supply of money and making it more expensive to borrow, the central bank aims to reduce spending and investment in the economy, which can help to lower inflation. A contractionary monetary policy is the opposite of an expansionary monetary policy, which is used to stimulate economic growth by increasing the money supply and lowering interest rates.

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"Provision of employment" is not a problem of agriculture. It is actually a benefit of agriculture. Agriculture provides job opportunities for people, from farmers to food processing workers. The other three options listed are actual problems faced by the agriculture industry: - Lack of preservation and storage facilities can lead to food waste and loss of income for farmers. - Land tenure system refers to the rules and regulations governing who can use and own land. In many countries, the land tenure system is not favorable for small farmers and can limit their ability to produce food. - Poor transportation systems can make it difficult for farmers to get their products to market and for consumers to access fresh food.

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If two commodities are unrelated, a change in the price of one will have no effect on the quantity demanded of the other. This is because unrelated commodities are not substitutes for each other, so a change in the price of one will not affect the demand for the other. For example, if the price of apples increases, it will not affect the demand for bananas, since apples and bananas are not substitutes for each other. Similarly, if the price of bananas decreases, it will not affect the demand for apples. This is because the demand for each commodity is determined by its own factors, such as income, tastes, and preferences, and not by the price of other unrelated commodities.

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The demand for labor is a "derived demand". This means that the demand for labor is not a direct demand for labor itself, but rather it is derived from the demand for goods and services that labor can produce. In other words, businesses hire workers because they need them to produce the goods and services that they sell. For example, if a business sells pizzas, it will need workers to make the pizzas, deliver the pizzas, and serve the customers. The demand for labor in this case is derived from the demand for pizzas. If the demand for pizzas increases, the demand for labor to produce and deliver the pizzas will also increase. Therefore, the demand for labor is closely tied to the demand for the goods and services that labor produces, and it is derived from that demand.

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Changes in demand can be influenced by various factors. Among them, changes in consumer preferences, real income, distribution of incomes, and levels of taxation can all affect the quantity of a good or service that consumers are willing and able to buy at a given price. I. Changes in consumer preferences refer to shifts in the tastes and preferences of consumers. For example, if people start to prefer healthier food options, the demand for fruits and vegetables may increase while the demand for processed foods may decrease. II. Changes in real income can also impact demand. If people's real income increases, they may be able to afford more goods and services, which can lead to an increase in demand for those products. Conversely, if real income decreases, consumers may cut back on their spending, leading to a decrease in demand. III. Changes in the distribution of incomes can also affect demand. If the distribution of incomes becomes more unequal, with some people becoming much richer and others becoming much poorer, this can impact the demand for certain products. For example, if the rich become richer, they may be more willing to purchase luxury goods, leading to an increase in demand for those products. On the other hand, if the poor become poorer, they may not be able to afford certain goods, leading to a decrease in demand. IV. Changes in levels of taxation can impact demand by affecting the disposable income of consumers. If taxes increase, consumers may have less disposable income, leading to a decrease in demand for certain goods and services. Conversely, if taxes decrease, consumers may have more disposable income, leading to an increase in demand for certain products. Therefore, the answer is: I, II, III, IV, since all four factors can account for changes in demand.

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External economies arise essentially from the localization of industry. External economies occur when an industry or group of firms in a specific geographical area experience benefits beyond what they could achieve individually. This can include access to specialized suppliers, a skilled labor force, and a larger market for their products or services. Localization of industry refers to the concentration of firms in a specific area. This can create a cluster of related industries and suppliers, allowing for easier collaboration, lower transportation costs, and increased efficiency. Government policies, such as subsidies or tax incentives, may encourage the localization of industries, but they do not create external economies themselves. Similarly, a firm's individual policies and the free transferability of shares do not create external economies as they are focused on the internal operations of the firm. Overall, external economies are a result of the benefits that arise from firms operating in close proximity to each other in a specific geographic location, which can lead to increased efficiency and productivity for all firms involved.

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In 1976, there were 8 live births for every 1,000 people in the population of the country. This means that for a population of 10 million people, there would be 8 x 10,000 = 80,000 live births in the country.

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The measure of location that is not a measure of location is "Range". A measure of location gives us an idea of where most of the values in a data set are concentrated. Arithmetic mean, Harmonic mean, and Geometric mean are all measures of location that give us a single value to represent the center of the data set. For example, the arithmetic mean is the sum of all the values divided by the number of values. The harmonic mean is the reciprocal of the arithmetic mean of the reciprocals of the data values. The geometric mean is the nth root of the product of n values. On the other hand, the range is a measure of spread, which gives us an idea of how spread out the values in a data set are. The range is simply the difference between the largest and smallest values in a data set.

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Capital formation (CF) is equal to P minus C, where P is production and C is consumption. Capital formation refers to the process of creating new capital goods, such as factories, machines, and infrastructure, which are used to produce goods and services. This process requires investment in new capital goods and is therefore reflected as a reduction in consumption. So, CF = P - C, where P is the total amount of goods and services produced and C is the amount consumed by households, businesses, and government. This equation shows that the amount of new capital being formed is equal to the difference between what is produced and what is consumed. In simpler terms, capital formation is the amount of investment made in the economy to increase its productive capacity and support future economic growth.

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The main disadvantage of a one-man business is that the proprietor is personally liable for the firm's debts. This means that if the business is unable to pay its debts, the proprietor's personal assets, such as their savings, property, or other valuables, can be used to settle the debt. This can put the proprietor's personal financial stability at risk and may discourage them from taking on certain business ventures or expanding the business.

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The purchasing power of money depends upon the "price level". Price level refers to the general level of prices for goods and services in an economy. When the price level increases, the purchasing power of money decreases because it can buy fewer goods and services. Conversely, when the price level decreases, the purchasing power of money increases because it can buy more goods and services. For example, if a cup of coffee costs $2 and the price level remains the same, then $10 can buy 5 cups of coffee. However, if the price of coffee increases to $3, then the purchasing power of $10 decreases and can now only buy 3 and 1/3 cups of coffee. So, the purchasing power of money depends on the price level, because the price level determines how much goods and services money can buy.

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The determination of price by bargaining between buyers and sellers is called Haggling or Higgling. This is a process where buyers and sellers negotiate the price of a product or service, typically in an informal setting. The buyer wants to pay as little as possible, while the seller wants to get as much as they can. They both compromise and agree on a price that is acceptable to both parties. Haggling is common in open-air markets, street vendors, and in some cultures it's a part of the normal purchasing process. In this process, the buyer and the seller communicate and exchange information about the value of the product or service, and how much each is willing to pay or receive. The price is ultimately determined through a give-and-take negotiation, and both parties must agree on the final price for the transaction to occur.

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An oil spill is the release of a liquid petroleum hydrocarbon into the environment. This can occur in a variety of ways, such as from an oil tanker that leaks or a pipeline that ruptures. The oil can contaminate the water and harm wildlife, as well as damage the natural environment and disrupt human activities such as fishing and tourism. It is important to take measures to prevent and clean up oil spills to minimize their impact on the environment and local communities.

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In a perfect competition, the market price is determined by the market supply and demand junctions. This means that the price is set by the intersection of the supply of goods and services offered by producers and the demand for those goods and services by consumers. When there is a high demand for a good or service, the price will go up, and when there is a low demand, the price will go down. This is because producers will raise their prices when there is high demand in order to make more profit, and they will lower their prices when there is low demand to try to sell more goods. On the other hand, consumers will be willing to pay more for a good or service when there is high demand and they will be less willing to pay when there is low demand. The market price is a result of the negotiation between producers and consumers, and it reflects the balance between supply and demand in the market.

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Industrialization is the process of transforming an economy from primarily agriculture and handicrafts to one based on the manufacturing of goods. This process usually involves the development of new technologies, the growth of factories, and an increase in the production of goods. The goal of industrialization is to increase economic growth and improve the standard of living for a society. During industrialization, the production of goods becomes more efficient and large-scale, and people move from rural areas to cities to work in factories. In short, industrialization is the transformation of a society from traditional ways of making things to more modern and efficient methods of production.

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Economics is a social science concerned with the proper use and allocation of resources for growth. Economics is the study of how society uses its limited resources to satisfy its unlimited wants and needs. It is concerned with how individuals, businesses, and governments make choices about how to use resources to produce goods and services, and how these goods and services are distributed among the members of society. The proper use and allocation of resources are essential for economic growth, which is the increase in the production and consumption of goods and services over time. This growth is achieved through the efficient use of resources to create more goods and services, which can then be distributed to meet the needs of society. Economics helps us to understand how resources are allocated and used in different economies and how these decisions affect the overall well-being of individuals and societies.