JAMB UTME - Economics - 2023

Among all the determinants of economic growth, the most important one is

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The Gross Domestic Product is the total monetary or market value of all the goods and services produced within a country. It is used to measure the rate of growth in an economy.

Which of the following would not be a reason for a government to impose a quota on imports?

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A quota on imports is a restriction imposed by a government on the quantity of goods that can be imported into a country. It is typically done to protect domestic industries and promote economic growth.

Out of the given options, a government imposing a quota on imports would not be done to decrease tax revenue. In fact, the purpose of implementing import quotas is quite the opposite – to increase tax revenue by protecting domestic industries and promoting their growth.

Let's understand this further:

1. To support strategic industry: One of the main reasons governments impose import quotas is to protect and support domestic industries that are considered strategically important for the country's economy. By limiting imports, the government aims to give domestic industries an advantage by reducing competition from foreign firms.

2. To prevent dumping: Dumping refers to the practice of selling goods in another country at prices lower than their production costs or market value. This undermines domestic industries and poses a threat to their survival. By imposing import quotas, the government can control the influx of dumped products and protect domestic industries from unfair competition.

3. To decrease tax revenue: This option is incorrect because imposing import quotas does not aim to decrease tax revenue. When imports are restricted, domestic industries have less competition, which allows them to charge higher prices. As a result, the government can collect more tax revenue from these higher-priced goods, thus increasing its overall revenue.

4. Employment opportunity: Another reason governments may impose import quotas is to create employment opportunities. By limiting imports, domestic industries can expand their production and hire more workers to meet the local demand. This helps in reducing unemployment and improving the overall economic conditions of the country.

In conclusion, the correct answer is that a government would not impose a quota on imports to decrease tax revenue. Import quotas are intended to protect strategic industries, prevent dumping, and create employment opportunities, while also increasing tax revenue.

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The demand for a good is price inelastic if the price elasticity is less than one. Price elasticity measures how responsive the quantity demanded of a good is to a change in its price. If the price elasticity is less than one, it means that the quantity demanded is not very responsive to changes in price. In other words, a change in price will have a relatively small impact on the quantity demanded. Even if the price increases or decreases, people will still buy a similar amount of the good. This can happen when the good is a necessity or when there are limited substitutes available. For example, if the price of water increases, people will still need to buy a similar amount because water is essential for survival. Similarly, if the price of a specific medication increases, people with no alternative options will still purchase it regardless of the price. Therefore, when the price elasticity is less than one, we say that the demand for the good is price inelastic.

The development of an economic hypothesis through intuition, insight, or logic is associated with

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Normative economics is a perspective on economics that reflects normative, or ideologically prescriptive judgments toward economic development, investment projects, statements, and scenarios. It expresses ideological judgments about what may results in economic activity if public policy changes are made.

The diagram above represent

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The dotted line in the graph above represent the upturn and downturn of the econonmy. Therefore, the diagram is cyclical unemployment.

An industry is

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An industry is a group of firms producing similar products and under separate administration or management.

If a business' total economic cost of producing 10,000 units of a product is N750,000 and this output is sold to consumers for N1,000,000, then the firm would earn

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Economic profit = Total revenue(Output) - Opportunity cost of input
= 1,000,000 - 750,000
= 250,000

The number of people who are qualified to work and who offered themselves for employment are called

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The correct term for the number of people who are qualified to work and who offer themselves for employment is the working population.
The working population refers to the subset of the total population that is actively engaged or seeking employment. It includes individuals who are qualified, available, and willing to work. This encompasses both employed individuals and those who are actively looking for work, such as job seekers.
The working population is an important measure for understanding the labor market. It helps policymakers, businesses, and economists in assessing the job market's health and determining factors such as employment rates, labor force participation, and unemployment rates.
Options like "mobility of labor" and "migrant labor" focus on the movement of workers between different locations, which is a related concept but not the same as the total number of qualified individuals available for employment. "Labor turnover" refers to the rate at which workers leave and join a particular company or industry, which is also not synonymous with the working population as a whole.
Therefore, the working population is the term that correctly describes the number of qualified individuals who are available for employment.

The demand for money will fall if

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If GDP falls, then people demand less money for transactions. As interest rate rise (fall), the demand for money will fall(rise).

If demand function for a product is Qd = 30 - 4P, and the price and quantity of products is 4 and 14 respectively. What is the price elasticity of demand for the product?

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Q = 14, P = 4

Qd = 30 - 4p

∆q/∆p = - 4
 

Ed = ΔqΔp×pq $\frac{<br>}{}$

= - 4 x 4/14

= Ed = -1.14
since price elasticity is positive, then Ed = 1.14

Institutions serving as links between surplus and deficit units can be identified as

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Financial intermediaries serve as links between surplus and deficit units in an economy. These intermediaries include banks, credit unions, and other financial institutions. When there is surplus money in the economy, individuals and businesses deposit the excess funds with financial intermediaries. These intermediaries then pool these funds together and make them available to deficit units, such as individuals or businesses in need of loans or financing. Financial intermediaries play a crucial role in the economy by efficiently allocating funds from surplus units to deficit units. They match the needs of borrowers with the resources of savers, helping to facilitate economic growth and development. Tax officers and pension offices, on the other hand, do not serve as direct links between surplus and deficit units. Tax officers collect taxes for the government, while pension offices manage pension funds for retired individuals. Although these entities may indirectly impact the allocation of funds in the economy, their primary roles are different from that of financial intermediaries. Acceptance houses are also not direct links between surplus and deficit units. Acceptance houses provide short-term financing through the purchase of bills of exchange. While they play a role in facilitating trade between businesses, their function is more specific and limited compared to the broader role of financial intermediaries. In summary, financial intermediaries such as banks and credit unions serve as the primary links between surplus and deficit units in an economy. They gather surplus funds from savers and make them available to borrowers, thereby promoting the efficient allocation of resources.

The theory of ............... was propounded by ..................

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The theory of absolute advantage was propounded by Adam Smith while the theory of comparative advantage was propounded by David Ricardo.

Agriculture accounts for about 60% of the

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Agriculture accounts for about 60% of the active labour force in West Africa. This is because a large portion of the population in West Africa is engaged in farming and other agricultural activities for their livelihood. The other options are incorrect as agriculture does not account for 60% of the arable land, service sector activities, or the commodity market in West Africa.

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To find the value of L when the supply (s) is equal to 20, we can use the given supply curve equation: S = 4L + 8.
The supply curve equation represents how much labor (L) will be supplied at a given wage rate (s). In this case, the equation tells us that the supply of labor is equal to 4 times the quantity of labor (L) plus 8.
To find L when s = 20, let's substitute s = 20 into the equation:
20 = 4L + 8
Next, let's isolate L by subtracting 8 from both sides of the equation:
20 - 8 = 4L
Simplifying further:
12 = 4L
Now, we need to solve for L. We can do this by dividing both sides of the equation by 4:
12/4 = 4L/4
Simplifying again:
3 = L
Therefore, when the supply (s) is equal to 20, the value of L is 3.
So the correct answer is 3.

What is the lowest price the monopolist can charge

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The monopolist can charge P2 price and still make profit as long as he covers his AVC. Any price below price P2, the monopoly will run at loss or shut down.

All of the following describes conditions necessary for existence of a perfect market EXCEPT

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A perfect market is a theoretical concept that represents an idealized scenario where certain conditions are met. In this market, there is an equilibrium between supply and demand, and no single buyer or seller has the power to influence prices. In order for a perfect market to exist, there are several conditions that need to be met. These conditions include: - **Lack of homogeneity of goods**: In a perfect market, goods are assumed to be identical and indistinguishable from one another. This means that there are no variations in quality, features, or brand identity. Buyers are indifferent to which seller they purchase from since the goods are the same. - **Perfect knowledge**: Another crucial condition is that all buyers and sellers in the market have access to complete and accurate information. This means they know the current market prices, availability of goods, and all relevant factors influencing the buying and selling decisions. No hidden or asymmetric information exists that could give an advantage to any market participant. - **Large buyers and sellers**: A perfect market assumes that there are a significant number of buyers and sellers in the market. This ensures that no single buyer or seller has enough market power to influence prices or control the market conditions. Each participant is a price taker, meaning they accept the prevailing market price and cannot change it on their own. - **Portability of goods**: The final condition for a perfect market is the ease with which goods can be transported from one place to another. This means that there are no significant barriers to trade, such as transportation costs, tariffs, or restrictions. Goods can freely move between buyers and sellers, allowing for efficient market operations. Now, looking at the given options, we need to identify the one that does NOT describe a condition necessary for the existence of a perfect market. And that would be **"lack of homogeneity of goods"**. In a perfect market, goods are assumed to be identical and indistinguishable. This means that there are no variations in quality or features. Homogeneity is a vital characteristic of a perfect market, so the lack of it would hinder the existence of a perfect market. In summary, the conditions required for a perfect market are: perfect knowledge, large buyers and sellers, and portability of goods. While homogeneity of goods is a necessary condition for a perfect market, it is not described in the options as a condition necessary for the existence of a perfect market.

The diagram above represent

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The diagram above represent a monopolist diagram.

From the graph above, the consumer is at equilibrium at point

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Based on the graph, the consumer is at equilibrium at point k.

Equilibrium is when the quantity demanded by the consumer is equal to the quantity supplied by the market. At equilibrium, there is no shortage or surplus of the goods or services.

Point k on the graph represents the intersection of the demand curve (D) and the supply curve (S). At this point, the quantity demanded (Qd) and the quantity supplied (Qs) are equal.

If the consumer is at any other point on the graph, either to the left or to the right of point k, there would be either a shortage or a surplus of the goods or services. This would mean that the demand and supply are not in balance and the market is not at equilibrium.

Therefore, point k is the correct answer as it represents the position where the consumer is at equilibrium.

Business cycle is associated with

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Business cycle are intervals of expansion followed by recession in economic activity. It is characterized by general upswings and downturns in a span of macroeconomics variable.

The maximum price is

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The maximum price is **P4**. To explain why, we need to understand that the prices are listed in ascending order. This means that **P1** is the lowest price and **P4** is the highest price. When we say "maximum price," we are referring to the highest possible price among the given options. In this case, **P4** is the highest price listed. Therefore, the maximum price is **P4**.

Calculate the equilibrium level of national income (Y) where Y = C + I + G; C = 100 + 0.75Y; I = 50; G = 200

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To calculate the equilibrium level of national income (Y), we start with the equation Y = C + I + G. In this equation, C represents consumption spending, I represents investment spending, and G represents government spending. Now, let's substitute the given values into the equation: C = 100 + 0.75Y I = 50 G = 200 Substituting these values, we get: Y = (100 + 0.75Y) + 50 + 200 To solve for Y, we need to simplify the equation: Y = 100 + 0.75Y + 50 + 200 Combining like terms, we have: Y = 350 + 0.75Y Next, we can solve for Y by isolating it on one side of the equation. To do this, we can subtract 0.75Y from both sides: Y - 0.75Y = 350 Simplifying further, we have: 0.25Y = 350 Finally, we can solve for Y by dividing both sides of the equation by 0.25: Y = 350 / 0.25 Calculating this, we find: Y = 1400 So, the equilibrium level of national income (Y) is 1400.

Which of the following is NOT one of the characteristics of developing countries?

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Mono- product economy ( an economy that produces one product or commodity) is not a characteristics of developing country. The characteristics are: high level of illiteracy, dependence on agriculture, low savings and investment, low standard of living, population explosion, high death rate etc.

Part-time workers who desire full-time employment are:

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Part-time workers who desire full-time employment are classified as underemployed and contribute to the unemployment statistic.
Underemployment refers to a situation where individuals are working fewer hours than they would like or in jobs that do not utilize their skills and qualifications fully. In this case, part-time workers who desire full-time employment are considered underemployed because they are not able to secure the desired amount of work hours.
These underemployed workers contribute to the unemployment statistic because they are actively seeking additional work hours to meet their employment needs. They are considered part of the labor force because they are willing and available to work more hours, but they have not been able to find full-time employment.
It is important to note that not all underemployed workers contribute to the unemployment statistic. Some may choose to work part-time for personal reasons, such as family responsibilities or pursuing education. These individuals, although underemployed, are not actively seeking additional work hours and therefore do not contribute to the unemployment statistic.
However, in the case of individuals who are part-time workers and desire full-time employment, their underemployment status reflects the inadequacy of available job opportunities. They increase the count of unemployed individuals because they are willing and actively searching for additional work.
It is worth mentioning that cyclical unemployment is a different type of unemployment. It occurs when there is a downturn in the economy, causing a decrease in overall demand for goods and services, and subsequently, a decrease in the demand for labor. Cyclical unemployment is not directly related to the part-time workers' desire for full-time employment.

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The marginal propensity to consume (MPC) is a measure of how much of an increase in income is typically spent on consumption. It is represented by the symbol c or ΔC/ΔY. To explain it simply, the MPC tells us the proportion of additional income that is used for consumption rather than saving or other purposes. For example, if the MPC is 0.8, it means that for every additional unit of income, 0.8 units are typically spent on consumption. The MPC can also be understood as the slope of the consumption function. The consumption function is a mathematical relationship between income and consumption. The MPC represents how much consumption changes for a given change in income. In the equation C = C + cYd, the coefficient c represents the MPC. This equation shows that consumption (C) is determined by autonomous consumption (C) plus the product of the MPC (c) and disposable income (Yd). In summary, the MPC is a measure of how much additional income is typically used for consumption. It can be represented as ΔC/ΔY, the slope of the consumption function, or the coefficient c in the consumption equation.

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The short run can be defined as the period of time during which at least one of the firm's inputs is fixed. In other words, it is a time frame in which the firm cannot easily or quickly adjust all of its inputs. This means that some resources, such as the size of a factory or the number of employees, cannot be changed in the short run.
During the short run, firms can only adjust their production levels by varying the amount of variable inputs, such as raw materials or utilities. The fixed input, which remains constant in this period, imposes limitations on the firm's ability to increase or decrease its output. This constraint on adjusting all inputs is what distinguishes the short run from the long run, where all inputs can be varied.
It is important to note that the length of the short run can vary depending on the industry and the specific circumstances of the firm. For some businesses, the short run may be a few months, while for others it could be several years. However, what remains consistent is that during the short run, the firm is restricted in its ability to modify certain inputs, which can impact its production and overall performance.

When a kilogram of carrot is #8.00, 20 kilograms are demanded and when the price decreased to #6.000 per kilogram, 30 kilograms are demanded. The elasticity of demand equals to

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To calculate the elasticity of demand, we need to compare the changes in price and quantity demanded.
First, let's calculate the percentage change in price:
% change in price = ((new price - old price) / old price) x 100
% change in price = ((6 - 8) / 8) x 100
% change in price = (-2 / 8) x 100
% change in price = -25%
Next, let's calculate the percentage change in quantity demanded:
% change in quantity demanded = ((new quantity demanded - old quantity demanded) / old quantity demanded) x 100
% change in quantity demanded = ((30 - 20) / 20) x 100
% change in quantity demanded = (10 / 20) x 100
% change in quantity demanded = 50%
Now, let's calculate the elasticity of demand:
Elasticity of demand = % change in quantity demanded / % change in price
Elasticity of demand = 50% / -25%
Elasticity of demand = -2
The elasticity of demand is -2.
Explanation:
The negative sign in the elasticity of demand (-2) indicates that the demand for carrots is price elastic. This means that a decrease in price by 1% will lead to a more than proportionate increase in quantity demanded by 2%. In simpler terms, when the price of carrots decreased by 25%, the quantity demanded increased by 50%.
Therefore, the elasticity of demand is -2, which means that the demand for carrots is price elastic.

But since price elasticity is always represented with a positive number, the answer is 2

Multiplier can be described as

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A multiplier is a factor of proportionality that measures how much an endogenous variable changes in response to a change in some exogenous variable such as investment, consumption, government expediture etc.

Indicator of underdevelopment is

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An indicator of underdevelopment is low per capita income. Per capita income refers to the average income earned by individuals in a country. In underdeveloped countries, the per capita income is generally low, meaning that people have lower incomes on average compared to developed countries.
Low per capita income is a significant indicator of underdevelopment because it directly affects the standard of living of people within a country. With low income, individuals have limited purchasing power, making it difficult for them to afford basic necessities such as food, clothing, and shelter. This can lead to overall poor living conditions and a lack of access to essential services like healthcare and education.
Additionally, low per capita income also implies limited economic opportunities and a weak economy. It suggests that the country's productivity and industrial development are low, leading to low wages and limited job opportunities. This can result in high levels of poverty and unemployment, further hindering the country's development.
In summary, low per capita income is a crucial indicator of underdevelopment because it reflects the overall economic situation of a country and directly impacts the living conditions and opportunities available to its citizens.

The following are economic agents in any economy EXCEPT

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Economic agents are entities that make economic decisions. They include households, firms, and the government. The Central Bank, while an important institution, is not considered an economic agent as it does not make decisions about what, how, and for whom to produce. It is responsible for monetary policy and regulating the financial system.

.............is presently used in Nigeria to measure inflation

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The measure that is presently used in Nigeria to measure inflation is the Consumer Price Index (CPI). The CPI is a commonly used indicator worldwide to track changes in the cost of living over time.
The Consumer Price Index (CPI) measures the average price changes of a basket of goods and services typically purchased by households in a specific country or region. It reflects the price movements of essential items such as food, housing, transportation, healthcare, education, and many other goods and services that people consume regularly.
The CPI is calculated by collecting price data for various items in the basket and assigning them weights based on their relative importance in household spending. The prices are then compared to a base period, which is usually a specific year. The percentage change in the CPI from the base period indicates the rate of inflation or deflation.
In Nigeria, the CPI is used to monitor and analyze changes in the cost of goods and services, allowing policymakers and economists to assess the impact on consumers' purchasing power and make informed decisions. It helps in determining the effectiveness of government policies, evaluating the performance of the economy, and adjusting wages and prices.
By tracking the CPI, the government can identify if there is an increase in the general level of prices, indicating inflation, or a decrease, indicating deflation. This information helps in formulating monetary and fiscal policies to control inflation rates and maintain price stability.
Overall, the Consumer Price Index (CPI) is the measure currently used in Nigeria to gauge inflation and is crucial in understanding how the cost of living changes over time, impacting the economy and the daily lives of individuals and businesses.

Real cost is

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Real cost is the cost of producing a good or service, including the cost of all resources used and the cost of not employing those resources in alternative uses.

A persistence rise in the prices of inputs will lead to

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A persistence rise in the prices of inputs, such as raw materials or labor, can lead to **cost push inflation**. Cost push inflation occurs when the increased costs of production for firms are passed on to consumers in the form of higher prices for goods and services. This can happen when the prices of inputs used in production rise over a sustained period. When input costs increase, businesses often have two options: absorb the increased costs and accept lower profit margins, or pass on the higher costs to consumers by raising prices. If firms choose to raise prices, it can lead to a general increase in the overall price level in the economy. Here's a simple example to help illustrate this concept: Let's say there is a town where the main industry is manufacturing shoes. The cost of leather, which is a key input in shoe production, starts to rise due to factors like high demand or scarcity. In response, shoe manufacturers have to pay more for leather, and this increases their production costs. To maintain their profit margins, the manufacturers decide to increase the prices of shoes they sell to retailers. Now, if the retailers decide to pass on the higher costs to the consumers, the prices of shoes will increase. This can create a ripple effect throughout the economy because consumers will have to spend more money on shoes, reducing their purchasing power for other goods and services. As a result, the overall price level in the economy increases, and this is what we call cost push inflation. It is important to note that cost push inflation is different from demand pull inflation. Demand pull inflation occurs when there is an increase in aggregate demand, leading to an excess of demand over supply. In contrast, cost push inflation is driven by increased production costs. Hyperinflation, on the other hand, is an extreme form of inflation characterized by an uncontrollable increase in prices. It is typically caused by factors like rapid money supply growth or loss of confidence in the currency. Stagflation refers to a situation where there is a combination of high inflation and high unemployment, typically accompanied by low economic growth. This can occur when an economy experiences a supply-side shock, such as a significant increase in the prices of key inputs. In summary, a persistence rise in the prices of inputs can lead to cost push inflation, as firms pass on the increased costs to consumers by raising prices.

Government uses all of the following ways to redistribute income, except

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The government uses various methods to redistribute income in society. Three of these ways are market intervention, transfer earnings, and taxation. Market intervention involves the government stepping in and regulating certain aspects of the economy to ensure fairness and reduce income inequality. For example, the government may set a minimum wage so that workers are guaranteed a certain level of income. Transfer earnings refer to government programs that provide financial assistance to individuals or families who are in need. These programs include welfare, unemployment benefits, and social security. The goal is to provide support to those who may have lower incomes or are facing financial difficulties. Taxation is another method used by the government to redistribute income. Through taxes, the government collects money from individuals and businesses based on their income or profits. This revenue is then used to fund public services such as healthcare, education, infrastructure, and social programs. However, the answer to the question is that the government does not use limited liability as a way to redistribute income. Limited liability is a legal concept that protects individuals from being personally liable for the debts and liabilities of a company. It is not directly related to income redistribution. In summary, the government redistributes income through market intervention, transfer earnings, and taxation. These methods aim to promote fairness and provide support to those in need. However, limited liability is not a method used for income redistribution.

The fundamental problem of economics is

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The fundamental problem of Economics is Scarcity. Scarcity explains the basic economic problem that the world has limited or scarce resources to meet seemingly unlimited wants, and this reality forces people to make decisions about how to allocate resources in the most efficient way.

From the graph below, Point "E" shows--------------

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Point 'E" inside the graph indicates it is technologically inefficient" , Underemployed" or wide spread unemployent" or resources are not fully utilized or production inefficient"

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An example of a free good is water in the ocean.

A free good is a good that is available in unlimited supply and does not require any payment or exchange to obtain it.

In the case of water in the ocean, it is freely available and accessible to anyone. It is not owned by anyone and does not require any payment to access or use it. Therefore, it can be considered a free good.

On the other hand, free education, dinner you did not pay for, and your rented apartment are not examples of free goods.

Free education typically refers to education that is provided without direct payment by the student. While it may be free for the student, someone is still paying for it, such as the government or private institutions.

A dinner that you did not pay for may seem free to you, but someone, such as a friend or a host, is still paying for it. The cost of that dinner is borne by someone else, even if it is not you.

Similarly, a rented apartment is not a free good because it involves a transaction where you pay for the use of the apartment. You enter into a contractual agreement with the landlord and pay rent in exchange for living in the apartment.

------------- is NOT the cause of balance of payments (BOP) deficits in Nigeria

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The causes of balance of payment deficit are: low level of agriculture, low level of technological development, inadequacies in export promotion strategy, political instability, poor social and economic infrastructure, servicing of huge external debts, existence of import dependent industries etc.

Which of the following shows why individual demand curve for a good usually slopes downward from left to right?

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A normal demand curve slopes downward from left to right indicating at higher price, less quantity will be demanded and vice versa.

Public corporation is financed with

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Public corporations are run by the government through the tax paid by the people. They are established by an act of parliament or decree and it is controlled by the board of directors, appointed by the government.

Suppose the public expenditure as a percentage of GDP of four countries is shown in the table below

Which type of economy exists in these countries?

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The type of economy that exists in these countries is Mixed economy.

A mixed economy is an economic system that combines elements of both market and planned economies. It includes both private and public sectors, and the government plays a significant role in regulating and defining the structure of the economy.

In the given scenario, the fact that the countries have different levels of public expenditure as a percentage of GDP indicates that the government plays a role in the economy and is involved in spending a portion of the national income.

While the exact percentage of public expenditure varies between the countries, the presence of any public expenditure suggests government intervention and regulation in the economy. This means that these countries have a mixed economy, where both public and private sectors coexist and contribute to economic activities.

The government's involvement can take various forms, such as funding public goods and services, implementing social programs, and regulating industries. The level of government intervention may vary, but the presence of public expenditure indicates that the government has an active role in shaping the economy.

Therefore, based on the information provided, it can be concluded that the countries mentioned in the table have a mixed economy.