JAMB UTME - Economics - 2022

Occupational mobility as applied to factors of production means the case by which

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The major role of multi-national companies in the petroleum industry in Nigeria is

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The major role of multinational companies in the petroleum industry in Nigeria is oil prospecting. Multinational companies, also known as International Oil Companies (IOCs), play a significant role in the exploration and production of oil and gas in Nigeria. These companies invest heavily in the exploration of new oil fields, as well as the development and production of existing fields. While some IOCs are also involved in oil marketing and refining, their primary role in Nigeria is oil prospecting. The IOCs in Nigeria include major companies such as Shell, ExxonMobil, Chevron, and Total.

The advantage which firms obtain directly from expanding their operations are referred to as

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The advantage which firms obtain directly from expanding their operations are referred to as "internal economies of scale." Internal economies of scale occur when a firm's average cost of production decreases as it increases the scale of its operations. This can be due to a variety of factors, such as increased specialization of labor, greater use of capital equipment, or better purchasing power for inputs. Internal economies of scale enable a firm to become more efficient and competitive as it grows, which can result in higher profits and a stronger market position. The opposite of internal economies of scale is internal diseconomies of scale, which occur when the average cost of production increases as a firm becomes too large or complex to manage efficiently.

The theory of comparative advantage states that a commodity should be produced in that nation where the

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The theory of comparative advantage states that a commodity should be produced in that nation where the opportunity cost is least. Opportunity cost is the cost of choosing one option over another, and in the context of comparative advantage, it refers to the cost of producing a particular good or service in terms of what has to be given up to produce it. A country should specialize in producing and exporting the goods and services for which it has a comparative advantage, which means that it can produce them at a lower opportunity cost than other countries. While the absolute cost and absolute money cost of production can be important factors in determining the competitiveness of a particular commodity, the theory of comparative advantage emphasizes the importance of considering opportunity cost. Furthermore, the production possibility curve, which shows the maximum combination of two goods that can be produced with a given set of resources, is not directly related to the theory of comparative advantage, although it can help illustrate some of the concepts involved in the theory.

An advantage of the sole proprietorship over the partnership form of business organization is that

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An advantage of the sole proprietorship over the partnership form of business organization is that it relies on the decision of one individual and does not require the consent or involvement of others. This can make decision-making more efficient and effective, and reduce the possibility of conflicts between partners. In contrast, partnerships require consensus and agreement among multiple individuals, which can be time-consuming and challenging, especially when there are disagreements. However, it is important to note that a sole proprietorship does not enjoy limited liability for debt in the event of failure, and its existence is limited by the individual owner's life span.

If inflation is anticipated, people may

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If inflation is anticipated, people may choose to spend less money. This is because inflation reduces the purchasing power of money, meaning that the same amount of money can buy fewer goods and services. In response, people may decide to be more frugal with their spending, save more money, or look for ways to reduce their expenses. By spending less, they can try to maintain their purchasing power and avoid the negative effects of inflation.

An important factor hindering the rapid development of the industrial sector in Nigeria.

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The middlemen is responsible for

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The middlemen is responsible for "breaking the bulk". Middlemen are intermediaries between producers and consumers in the distribution process. They play a crucial role in getting products from the producers to the consumers, and they perform a variety of functions such as transportation, storage, and marketing. One important function of middlemen is to break the bulk of products. This means they take large quantities of goods from producers and break them down into smaller units that can be sold to consumers in the desired quantities. For example, a farmer may produce tons of wheat, but consumers may only want to buy it in small quantities. Middlemen can purchase the bulk quantity from the farmer, then break it down into smaller units that can be sold to individual consumers. Breaking the bulk is important for several reasons. It allows for greater efficiency in the distribution process, as products can be transported and stored more easily in smaller units. It also allows for greater flexibility in meeting consumer demand, as products can be sold in the quantities that consumers desire. Finally, it can help to reduce costs for both producers and consumers, as middlemen can aggregate products from multiple producers and sell them at a lower cost than individual producers could achieve on their own.

Commercial banks are different from development banks in that the latter

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Commercial banks and development banks serve different functions within the financial system. Commercial banks are focused on providing financial services to individuals and businesses, such as deposit accounts, loans, and credit cards. They generally lend on a short-term basis and deal in a variety of currencies, including foreign currencies. In contrast, development banks are focused on promoting economic development and supporting long-term projects that may not be attractive to commercial banks. They typically provide financing for large infrastructure projects, such as highways, railways, and power plants, as well as small and medium-sized enterprises. Development banks may be government-owned, private, or a combination of both, and their main goal is to support economic growth and development. Development banks may also offer technical assistance and advisory services to help businesses and governments develop the skills and expertise needed to manage large-scale projects effectively. Unlike commercial banks, development banks may not pay interest on current accounts and may have different lending terms and requirements based on the specific needs of the project or business being financed.

A disadvantage of a joint-stock company is

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A disadvantage of a joint-stock company is the potential for loss of controlling interest. In a joint-stock company, ownership is divided into shares, which can be bought and sold by individual shareholders. If a large number of shares are sold to other individuals or entities, it can dilute the ownership and control of the original shareholders, making it more difficult for them to have a significant say in the decision-making process. Limited liability is actually an advantage of a joint-stock company, as it protects shareholders from personal financial liability beyond their investment in the company. Continuity is also an advantage of a joint-stock company, as it can continue to exist even if shareholders come and go or if one or more shareholders die. Unlimited liability, on the other hand, is a disadvantage of a sole proprietorship or partnership, where the owner or partners can be held personally liable for the debts and obligations of the business.

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

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The line labelled M in the diagram above represent

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What happens when the central bank increases the bank rate in an economy

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When the central bank increases the bank rate, it becomes more expensive for banks to borrow money from the central bank. This, in turn, leads banks to charge higher interest rates on loans they give to their customers. As a result, borrowing becomes more expensive for customers, so they might choose to borrow less money or pay off existing loans. This discourages borrowing and slows down the overall spending in the economy. On the other hand, since banks have to pay a higher interest rate to the central bank, they might be able to increase the interest they charge on loans, which would increase their profits. The increase in the bank rate does not directly impact the money supply in the economy. The central bank can use other tools, such as open market operations, to influence the money supply.

Fiscal policy measures imply a change in

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Fiscal policy measures imply a change in government revenue and expenditure to regulate an economy. Fiscal policy is a tool used by governments to influence the economy by adjusting their spending levels and tax rates. This can be done by either increasing or decreasing government spending and taxes in order to achieve specific economic goals, such as controlling inflation, boosting employment, or promoting economic growth. For example, if the government wants to stimulate economic growth, it may increase its spending on infrastructure projects or offer tax incentives to businesses. Conversely, if the government wants to control inflation, it may decrease government spending and increase taxes to reduce the amount of money circulating in the economy. Therefore, fiscal policy measures involve making changes to both government revenue and expenditure in order to achieve specific economic objectives.

In the long-run, a firm must shut down if its average revenue is

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In the long-run, a firm should shut down if its average revenue is less than its average cost. This is because, in the long-run, all costs are considered variable, meaning the firm can adjust its production and input levels. If the firm continues to operate despite having average revenue less than average cost, it will continue to incur losses. To understand this concept, it's essential to know what the average revenue and average cost mean. Average revenue is the total revenue earned by a firm divided by the quantity of output produced. On the other hand, average cost is the total cost incurred by a firm divided by the quantity of output produced. The average cost can further be divided into two categories: average variable cost and average fixed cost. The average variable cost is the cost that varies with the level of output, such as labor and raw material costs. In contrast, the average fixed cost is the cost that remains constant regardless of the level of output, such as rent and salaries. So, in the long-run, a firm must shut down if its average revenue is less than its average cost because it means that the firm is not generating enough revenue to cover all its variable and fixed costs. By shutting down, the firm can avoid further losses and redirect its resources elsewhere. On the other hand, if the firm's average revenue is greater than its average cost, it can continue to operate and earn profits.

Developments outside a given firm that reduce the firm’s costs are called

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Developments outside a given firm that reduce the firm's costs are called "external economies." External economies refer to the benefits that firms receive from positive externalities generated by other firms or industries in the same geographic area. For example, if a new technology park is established nearby, the firms in the area may benefit from lower input costs, better transportation links, or access to skilled workers. These benefits can result in lower production costs, higher productivity, and improved competitiveness for the firms in the area. The opposite of external economies is external diseconomies, which occur when external factors increase the costs of production for firms in a particular area.

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

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The elasticity of demand measures the responsiveness of the quantity demanded of a commodity to a change in its price. In this case, when the price of the commodity increased from $4.00 to $5.00, the quantity demanded increased from 20 units to 30 units. To calculate the elasticity of demand, we use the following formula: Elasticity of demand = (percent change in quantity demanded) / (percent change in price) First, let's find the percent change in quantity demanded: (30 units - 20 units) / 20 units = 0.50 or 50% Next, let's find the percent change in price: (5.00 - 4.00) / 4.00 = 0.25 or 25% Finally, let's plug in the values into the formula: Elasticity of demand = 0.50 / 0.25 = 2.00 So, the elasticity of demand in this case is 2.00. This means that a 1% increase in price leads to a 2% decrease in the quantity demanded.

A country's budget allocation to various sectors of the economy is shown in the pie chart above...

Use it to answer this question.

If the budget of the country was $7,200, how much is allocated to Education?

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Based on the pie chart, the Education sector is represented by 1/3 of the total budget allocation. To find out how much is allocated to Education, we can calculate 1/3 of the total budget: 1/3 x $7,200 = $2,400 Therefore, the answer is $2,400.00.

A positive effect of a rapid population increase is

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A positive effect of a rapid population increase is a wider market for goods and services. When there are more people in a country, there is a higher demand for goods and services, which can lead to economic growth and development. As more people are born and immigrate to a country, they will need housing, food, clothing, healthcare, and other goods and services, which can lead to an increase in jobs and businesses. This wider market for goods and services can stimulate economic growth, create job opportunities, and ultimately improve the standard of living for individuals in the country. However, it is important to note that rapid population growth can also bring challenges such as pressure on resources and infrastructure, which can lead to other negative effects.

Which of the following activities will not lead to economic growth?

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Massive importation of consumer goods will not lead to economic growth. Economic growth refers to an increase in the capacity of an economy to produce goods and services over a period of time. It is measured by the growth in the gross domestic product (GDP) of a country. Massive importation of consumer goods may lead to an increase in consumption, but it does not lead to an increase in the productive capacity of an economy. This is because consumer goods are used for immediate consumption and do not contribute to the production of other goods and services. On the other hand, capital goods like machinery, equipment, and infrastructure are used to produce other goods and services, and their importation can lead to economic growth by increasing the productive capacity of an economy. Intensive capital formation and the use of modern technology also contribute to economic growth by increasing the efficiency and productivity of an economy.

If at 10K per kg, 1000kg of yam were purchased, the resultant point elasticity of demand is

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The distinction between capital and recurrent expenditure lies in the

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Demand-pull inflation is likely to be caused by

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Demand-pull inflation occurs when the overall demand for goods and services in an economy exceeds the supply of those goods and services, leading to an increase in the general price level. This increase in demand may be caused by a number of factors, such as an increase in consumer confidence, an increase in government spending, or an increase in exports. Out of the given options, an increasingly large budget deficit is the most likely cause of demand-pull inflation. When the government spends more money than it collects in taxes, it may finance the deficit by borrowing from the central bank, other banks or the public. This increases the overall amount of money in circulation in the economy, which in turn leads to an increase in demand for goods and services. This increased demand can then lead to higher prices for those goods and services, resulting in demand-pull inflation. An increase in the cost of factor inputs, such as labor or raw materials, may also contribute to inflation, but this is known as cost-push inflation, which occurs when the cost of producing goods and services increases, leading to higher prices. An increase in the income tax rate and an increase in the bank lending rate can reduce the overall demand for goods and services and lead to a decrease in inflation.

Which of the following factors is not a reason for farmers' unstable incomes?

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An example of commodity money is

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An example of commodity money is silver. Commodity money is a physical object that has intrinsic value in addition to its value as a medium of exchange. Historically, commodities such as gold and silver have been used as a form of money because they are scarce and have inherent value. For example, silver is used not only as money, but also for jewelry, silverware, and other industrial applications. In this way, its value is based on its usefulness in addition to its value as a medium of exchange. In contrast, modern forms of money, such as currency notes, mobile money, and cheques, are not commodities in and of themselves but represent a claim on goods and services.

If the Central Bank increases its bank rate

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If the Central Bank increases its bank rate, it means that it has increased the interest rate at which commercial banks can borrow money from the Central Bank. This, in turn, makes it more expensive for commercial banks to borrow money, which can have several effects on the economy. Firstly, since it is more expensive for banks to borrow money, they may become more cautious about lending money to their customers. This means that customers may find it more difficult to obtain loans or credit from banks, and the amount of borrowing may decrease. So, is not correct. Secondly, if banks find it more expensive to borrow money, they may also try to increase the interest rates they charge on loans and mortgages to maintain their profits. This could make borrowing more expensive for customers, and the interest charges by banks may rise rather than fall. So, is not correct. Thirdly, if the cost of borrowing money for commercial banks increases, they may not want to borrow as much money, which could reduce the supply of money in the economy. So, is correct. Lastly, an increase in the Central Bank's bank rate may not cause many banks to shut down their operations. However, some smaller banks or financial institutions that heavily rely on borrowing may struggle to stay afloat. So, is not correct. In conclusion, an increase in the Central Bank's bank rate can reduce the supply of money in the economy and increase the cost of borrowing for banks, which could result in higher interest rates for customers.

Which of the following cannot be classified as a natural resource?

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An iron rod cannot be classified as a natural resource. A natural resource is a material or substance that occurs naturally in the environment and can be used for economic gain. Natural resources can be classified into renewable and non-renewable resources. Renewable resources are those that can be replenished over time, such as solar energy, wildlife, and forests. Non-renewable resources are those that cannot be replenished, such as minerals and fossil fuels, including gold. An iron rod is not a natural resource because it is a manufactured item made from iron, which is a natural resource. The iron has been extracted from the earth and processed to make the rod, which is then used for various purposes. So, while the raw material (iron) may be a natural resource, the finished product (the iron rod) is not.

A baker bought flour and other ingredients for S250.00, spent S52.00 on distribution, sold the bread for S320.00. The value added by the baker.

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The value added by the baker is $90.00. To calculate the value added by the baker, we need to subtract the cost of goods sold (COGS) from the revenue. The COGS in this case includes the cost of flour and other ingredients, which is not given, but we know that the baker spent a total of $250.00 on these items. We also need to include the cost of distribution, which is $52.00. So the total COGS is $250.00 + $52.00 = $302.00. The revenue from selling the bread is $320.00. Therefore, the value added by the baker is $320.00 - $302.00 = $18.00. In other words, the baker added $18.00 of value to the raw materials and distribution costs to produce and sell the bread. This value added represents the baker's contribution to the economy and is a measure of the wealth created by the baker's business.

Palm oil and palm kernel are in

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Palm oil and palm kernel are in joint supply. Joint supply refers to a situation in which two or more products are produced together as a result of a single production process. In the case of palm oil and palm kernel, both products are obtained from the same fruit of the oil palm tree. When the fruit is processed, it produces two distinct products: palm oil and palm kernel. Palm oil is obtained from the fleshy outer part of the fruit, while palm kernel is obtained from the inner seed or kernel. Since both products are obtained from the same production process, the quantity of one product that is produced is directly related to the quantity of the other product that is produced. As a result of being in joint supply, the prices of palm oil and palm kernel are interdependent. If the demand for one product increases, this will increase the supply of the other product, which can lower its price. For example, if the demand for palm oil increases, more oil palm fruit will be processed, leading to an increase in the supply of palm kernel and a potential decrease in its price. To summarize, palm oil and palm kernel are in joint supply because they are both obtained from the same production process and the quantity of one product produced is directly related to the quantity of the other product produced. The prices of both products are interdependent, and a change in demand for one product can affect the supply and price of the other product.

The International Bank for Reconstruction and Development(IBRD) performs the following functions except-------

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The International Bank for Reconstruction and Development (IBRD) is a specialized agency of the United Nations that provides loans, technical assistance, and other services to developing countries. Out of the options provided, the IBRD does not reduce tariffs among its members. Its main focus is on granting long-term loans to member countries for development projects, providing technical expertise to help those countries implement those projects successfully, and developing human resources in those countries. Tariff reduction is not one of its main functions.

If the price of commodity X rises and consumers shift to commodity Y, then commodities X and Y are

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Commodities X and Y are substitutes. Substitute goods are products that can be used in place of each other. When the price of commodity X rises, consumers shift to commodity Y because it is a cheaper alternative to X. An example of substitute goods is coffee and tea - if the price of coffee increases, some people may switch to drinking tea instead.

Economic goods are termed scarce when they are?

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Economic goods are termed scarce when they are "not available in sufficient quantities to satisfy all wants for them." Scarce resources are those that have a limited supply relative to the demand for them. This scarcity means that choices must be made about how the resources are allocated, and that not all wants or needs can be fully satisfied. The concept of scarcity is fundamental to the study of economics, as it is the basis for understanding the concepts of opportunity cost, trade-offs, and efficiency.

A situation in which all inputs are doubled and output also doubles is known as

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The situation in which all inputs are doubled and the output also doubles is known as "constant returns to scale." This means that if a firm increases all of its inputs by a certain proportion, the output will also increase by the same proportion. In other words, the production function exhibits constant returns to scale if increasing all inputs by a constant factor results in an output increase by the same constant factor.

PN equals average revenue or marginal revenue cure of

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An example of transfer payments in national income accounting is

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Transfer payments refer to payments made by the government or other institutions to individuals or other entities, without receiving any goods or services in return. These payments are typically made for social welfare purposes or to redistribute income. An example of a transfer payment in national income accounting is unemployment allowance paid to citizens who are unemployed. The government pays these allowances to support individuals who are currently out of work and seeking employment. This payment is considered a transfer payment because the government is not receiving any goods or services in return for the funds provided. Transfer payments are not included in the calculation of GDP because they do not represent the production of goods or services. However, they are important in measuring the overall economic well-being of a society, particularly in terms of income distribution and social welfare.

The demand for labour is an example of

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The demand for labor is an example of "derived demand." Derived demand refers to the demand for a factor of production or a good that arises as a result of the demand for another good or service. In the case of labor, it is not demanded for its own sake but rather because it is needed to produce goods and services that consumers demand. The demand for labor is therefore derived from the demand for the goods and services that labor helps to produce.

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

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The industry that adds more value to primary products is the processing industry. The processing industry takes raw materials, such as those produced by the mining industry, and turns them into finished products through various manufacturing processes. This added value comes from transforming the raw materials into something that is more useful and valuable to consumers. The service industry, on the other hand, provides services to individuals and businesses, such as consulting, financial advice, or customer support. While the service industry is important for the economy, it does not add value to primary products in the same way that the processing industry does. The construction industry involves the building of structures and infrastructure, such as buildings, roads, and bridges. While the construction industry uses materials produced by the mining industry, it does not add value to these materials in the same way that the processing industry does. In conclusion, the processing industry is the industry that adds the most value to primary products by transforming raw materials into finished goods that are more useful and valuable to consumers.

A greater burden of the taxes on essential goods is borne by the

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A greater burden of the taxes on essential goods is typically borne by the lower income group. This is because essential goods such as food, clothing, and shelter make up a larger proportion of the budget of low-income households than they do for high-income households. When taxes are applied to these goods, the cost of living increases proportionally for low-income households, putting a greater burden on their limited resources. In contrast, high-income households can more easily absorb the higher costs without significantly affecting their standard of living.

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

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In a free market economy, the rationing of scarce goods is principally done by the price mechanism. The price of a good is determined by the forces of supply and demand in the market. When the supply of a good is limited and demand for it is high, the price of that good will increase. This higher price will serve as an incentive for producers to increase their supply of the good, and for consumers to reduce their demand for it. As a result, the scarce good will be rationed among consumers based on their willingness to pay the higher price. This process occurs naturally without the need for government intervention or control, and is a key feature of a free market economy.

In the long run, all production factors are

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In the long run, all production factors are "variable." This means that in the long run, a firm can adjust all of its production inputs, including labor, capital, and technology, to change the scale of its operations. In the short run, some inputs may be fixed, such as the size of the factory, which can only be changed in the long run. But in the long run, all inputs can be varied to optimize production and increase efficiency. The ability to adjust all inputs in the long run is what distinguishes the long run from the short run in the theory of production.