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1. Human want are unlimited because

A. production is inadequate
B. resources have alternative uses
C. new wants always rise
D. resources are limited

2. A basic economic problem of any society is

A. high level of illiteracy
B. irregular power supply
C. population growth
D. resource allocation

3. In a centrally planned economy, what to produce is

A. determined by the forces of demand and supply
B. driven by profit motive
C. determined by consumers
D. the responsibility of state's bureaucrats

4. Which of the following is reacted to resource allocation of an economy

A. How to produce
B. What to produce
C. For whom to produce
D. Efficient use of inputs

5. Which of following is not a feature of socialism?

A. Collective ownership of productive resources
B. Freedom of enterprise
C. production is not based on the profit motive
D. Maximization of public welfare

6. Households make economic decisions because they want to

A. make more profit
B. increase their salaries and wages
C. increase their purchases
D. maximize their satisfaction

7. State owned enterprises are more common in

A. central planned economics
B. mixed economics
C. capitalist economics
D. developed economics

8. A normal supply curve has a positive slope which indicates that

A. sellers are willing to sell more at a lower price
B. sellers are indifferent to prices
C. sellers are willing to sell more at a higher price
D. there is always a fixed supply

9. To control inflation, the central bank of a country may adopt

A. an expansionary monetary policy
B. a restrictive monetary policy
C. an increased wage policy
D. a deficit financing policy

10. Disposable income is the income earned

A. by the nationals of a country resident within the country
B. from productive activities of nationals of a country both at home and abroad
C. when personal income tax is deducted from personal income
D. when the gross income of an individual is added to person income tax

11. Livestock production in West Africa is hindered mainly by

A. inadequate demand
B. use of traditional implements
C. land tenure system
D. pests and diseases

12. The components of a three-sector economy are

A. banks, schools and hospitals
B. workers, producers and marketers
C. households, firms and the government
D. producers, retailers and wholesalers

13. A declining population is one in which the population is

A. experiencing a high rate of emigration
B. made up of large number of old people
C. not producing enough goods
D. not contributing enough to the national income

14. Which of the following agencies help to stabilize farmers' income?

A. Local government authorities
B. Trade unions
C. Marketing boards
D. Co-operative organizations

15. Other things being equal, an increase in supply will lead to

A. a fall in price and an increase in quantity bought and sold
B. an increase in price and increase in quantity bought and sold
C. a fall in price and a fall in quantity bought and sold
D. an increase in quantity supplied and demanded only

16. Examples of joint stock banks are

A. commercial banks
B. co-operative credit societies
C. central banks
D. development banks

17. Which of the following is not a characteristic of a developing country? High

A. real per capita income
B. level of primary production
C. population growth rate
D. level of illiteracy

18. Goods consumed out of habit have

A. elastic demand
B. perfectly elastic demand
C. inelastic demand
D. unitary elastic demand

19. Which of the following items is not a recurrent expenditure?

A. Building of schools and colleges
B. Maintenance of school buildings
C. Payment of teachers' salaries
D. Purchase of stationery for examinations

20. If the coefficient of price elasticity of demand is 0.1, demand is

A. elastic
B. inelastic
C. zero elastic
D. unitary elastic

21. The profit of a producer is the difference between

A. total cost and marginal cost
B. total revenue and total cost
C. average cost and total cost
D. price and total cost

22. The rate of increase in utility is

A. average utility
B. increasing utility
C. total utility
D. marginal utility

23. The supply of tea is linearly presented as P = 0 . 2Q, where P is the price and Q is the quantity. What is P when Q = 25?

A. 0.08
B. 5.00
C. 25.02
D. 125

24. Increase in supply due to changes in plant size will take place only in the

A. normal time
B. long run
C. market period
D. short run

25. The long - run average cost curve is made up of several short-run

A. marginal and average cost curves
B. average cost curves
C. average variable cost curves
D. average variable and total cost curves

Use the table below to answer questions 26 and 27

X 2 3 4 5
F 2 5 2 1


26. From the table, the mean of the distribution is?

A. 2.2
B. 2.5
C. 3.2
D. 4.5

27. What is the median of the distribution?

A. 5
B. 4
C. 3
D. 2

28. Co-operative societies formed to market the output of their members are called

A. Consumers' co-operative societies
B. marketing co-operative societies
C. Credit and thrift co-operative societies
D. Producers' co-operative societies

29. Money will serve as a standard of deferred payment if it is

A. homogeneous
B. durable
C. easily recognized
D. stable in value

30. Due to an increase in price, a seller increases the quantity offered for sale from 400 units. What is the percentage change in quantity supplied?

A. 1 %
B. 7.5%
C. 12.5%
D. 20%

31. Which of the following will increase the nominal value of national income?

A. High rate of inflation
B. increase in the value of money
C. Increase in import
D. High rate of subsistence production

32. Cyclical unemployment is one associated with

A. inadequate information
B. trade fluctuations
C. structural changes
D. seasonal changes

33. Which of the following best defines inflation?

A. Cyclical increase in prices
B. Periodic increase in prices
C. Persistent increase in prices
D. Occasional increase in prices

34. Perfect knowledge of events in a perfect market will be made possible by the existence of

A. many buyers and sellers
B. homogeneous products
C. means of communication
D. large number of traders

35. An increase in the price of a commodity from $\$10$ to $\$15$ leads to an increase in the quantity supplied from 10 units to 15 units. The price elasticity of supply is

A. 0.
B. 0.5.
C. 1.
D. 5.

36. Economic development may be hindered if there is

A. a high pool of skilled labour
B. a high rate of economic growth
C. political stability
D. rapid population growth

37. Which of the following types of unemployment results from changes in the pattern of aggregate demand?

A. Technological unemployment
B. Stuctural unemployment
C. Frictional unemployment
D. Seasonal unemployment

38. Which of the following is not a reason countries import goods?

A. Differences in natural endowments
B. the law of absolute advantage
C. Differences in tastes
D. The love for other nations

39. Provision of short-term loans to solve balance of payments problems is done by the

A. International Finance Corporation
B. International Monetary Fund
C. International Bank for Reconstruction and Development
D. African Development Bank

40. West African countries are experiencing worsening terms of trade because

A. they are primary producers
B. their currencies are overvalued
C. they import less machines
D. they are tertiary producers

41. Which of the following statements is correct?

A. As total utility increases, the marginal utility also increases
B. The marginal utility is a always zero whenever the total utility reaches the maximum
C. The total utility is at maximum whenever marginal utility is at it's maximum
D. There is no relationship between total utility and the marginal utility

42. A change in the quantity demanded of a given commodity is determined by the

A. size of the population
B. income of the consumer
C. price of the commodity
D. taste and fashion

43. The likely implication of the devaluation of a country's currency is that

A. exports of such a country become cheaper
B. importation of goods into such a country becomes cheaper
C. the value of such a country's currency rises
D. foreign goods are attracted into the country

44. International trade is desirable because it

A. may lead to overproduction
B. brings about over-dependence of countries on one another
C. provides foreign market for local goods
D. brings about unhealthy competition and rivalries

45. A financial institution established for the purpose of providing specialized services like acceptance of bills of exchange and equipment leasing is known as

A. Merchant Bank
B. Development Bank
C. Central Bank
D. Insurance Company

46. Which of the following functions of money is mostly affected during inflation?

A. Medium of exchange
B. Unit of Account
C. Store of value
D. Standard of deferred payment

47. Precautionary motive for holding money is to

A. meet daily and regular transactions
B. take advantage of changes in the prices of goods and services
C. cover unforeseen events
D. cover expenses on house rent

48. Which of the following measures will not encourage industrialization in West Africa?

A. Taking over of all forms of industries by the government
B. provision of social infrastructure
C. Giving tax incentives, especially to infant industries
D. Using tariffs to discourage the use of imported items

49. The concentration of many firms of a particular industry in a particular area is known as

A. location of industry
B. amalgamation of industries
C. localization of industries
D. nationalization of industry

50. Which of the following is not an effect of the discovery of mineral resources in an area?

A. increase in wealth
B. overcrowding
C. increase in crime rate
D. under population

ANSWER

# Ans # Ans
1D26B
2D27B
3D28D
4C29D
5B30D
6D31D
7A32C
8C33C
9B34A
10C35C
11D36D
12C37B
13B38D
14C39B
15A40A
16A41B
17A42C
18C43A
19C44C
20A45A
21B46C
22D47C
23D48A
24B49C
25D50D

Document

1. Human wants are

A. limited
B. scarce
C. unlimited
D. in grades

2. The difference between the money cost and the real cost of any item is that

A. real cost is the alternative forgone while the money cost is the actual amount paid for buying the item
B. the real cost is the opportunity cost, while the money cost is the marginal cost
C. money cost is the opportunity cost, while the real cost is the actual cost in monetary terms
D. money cost is always greater than the real cost

3. The production possibility curve (PPC) indicates that as more of one good is produced.

A. less of the other goods is produced
B. the same quantity of the other good is produced
C. more of the other good is produced
D. none of the other good is produced

4. An arrangement of data in rows and columns is referred to as

A. graph
B. bar chart
C. pie chart
D. table

5. A normal demand curve slopes

A. downward from left to right
B. upwards from right to left
C. downwards from right to left
D. upwards from left to right

6. The co-efficient of income elasticity of demand for inferior goods is

A. positive
B. equal to one
C. less than one
D. negative

7. If a 20% rise in price of Whiskey leads to a 30% increase in quantity demanded of Schnapps, the cross elasticity of demand is

A. 3.0
B. 2.5
C. 2.3
D. 1.5

8. Palm oil and palm kernel have

A. competitive supply
B. excess supply
C. joint supply
D. composite supply

9. A supply curve which is vertical has an elasticity co-efficient of

A. 0.0
B. 0.5
C. 1.5
D. 2

10. If the current price of an apple is twice that of last year, it implies that the value of money is

A. stable
B. falling
C. rising
D. getting stronger

11. Price fixed above the equilibrium is to

A. protect agricultural producers
B. discourage agricultural producers
C. lower the price of agricultural producers
D. favour consumers

12. A consumer purchasing a commodity X will maximize his satisfaction if

A. Px = MUx
B. Px ≥ MUx
C. Px > MUx
D. Px < MUx

13. When total utility is constant, it means marginal utility is

A. increasing
B. zero
C. decreasing
D. one

14. A rational consumer is one who

A. spends his income to maximize satisfaction
B. is not influenced by advertisement
C. behaves in a particular way all the time
D. knows the price of all goods and buys the cheapest

15. Which of the following is not true about land?

A. the supply is fixed
B. land is mobile
C. it is subject to diminishing returns
D. land is heterogeneous

16. The type of production that involve the tapping and harnessing of natural resources is

A. primary production
B. secondary production
C. tertiary production
D. industrial production

17. Which of the following does not change in the short run?

A. Variable cost
B. marginal cost
C. total cost
D. fixed cost

18. The resource used in production are called

A. variable inputs
B. factors of production
C. capital for production
D. fixed inputs

19. A firm will shut down in the long run if its earning is

A. less than normal profit
B. greater than normal profit
C. equal to super normal profit
D. less than super normal profit

20. A market structure where profit is maximized when marginal revenue, marginal cost and price are equal is known as

A. perfect competition
B. monopoly
C. oligopoly
D. imperfect competition

21. In which of the following markets does a firm have power to make super normal profits both in the short run and long run?

A. Monopoly
B. Duopoly
C. Oligopoly
D. Monopsony

22. If there are no barriers to entering a market, it means that

A. anyone can become a buyer or seller
B. unwanted goods can always enter the market
C. the market becomes a dumping ground
D. the goods are not inspected

23. A firm's main aim is to

A. survive the business
B. maximize profits
C. increase its market share
D. satisfy the ambition of its managers

24. One good reason for the elimination of middle men is that they

A. cause increase in price
B. help in price stability
C. grade and blend goods
D. are too many

25. The increase in population growth in big cities is referred to as

A. settlement
B. migration
C. industrialization
D. urbanization

26. Frictional unemployment can be reduced by
A. encouraging the use of retaining schemes
B. removing barriers to labour mobility
C. restricting the introduction of new technology
D. lowering the level of wages paid to young people

27. If the labour force of a country is 2.5 million and 2 million are employed , what is the unemployment rate?

A. 0.2%
B. 20%
C. 200%
D. 250%

28. The grouping of the population according to the economic activities people engage in is

A. age distribution
B. sex distribution
C. geographical distribution
D. occupational distribution

29. Natural growth rate of population can be defined as the

A. difference between birth rate and death rate
B. number of births in a year
C. increase in the population growth in a year
D. difference between the total population and the death rate

30. Which of the following is not a consequence of increased unemployment?

A. a fall in tax revenue for the government
B. a reduction in trade union's influence
C. a fall in death rate
D. an increase in the labour force

31. The following are features of subsistence agriculture except

A. little capital
B. processing of raw materials
C. small allotments of land
D. use of crude oil

32. Which of the following is not true of small companies? they

A. Cannot benefit from economies of scale
B. Are a good source of new jobs
C. Can satisfy demand in specialist markets
D. Have a good record of technical innovation

33. The effect of privatization on the industrial sector of a country is that it

A. ensures efficiency
B. discourages efficiency
C. leads to decrease in output
D. leads to liquidation

34. The production strategy used in an over-populated country is

A. import substitution
B. capital intensive
C. labour intensive
D. first come first employed

35. National income is used to measure

A. a country's population size
B. a country's economic growth
C. the human level of development
D. the flow of imports to a country

36. A tax is regressive if the

A. rate of tax is constant at all income levels
B. rate of tax decrease as income increases
C. rate of tax increases as income increases
D. tax is direct rather than indirect

37. When a country's net income from abroad is added to its total output, the result is

A. gross domestic product
B. net national product
C. gross national product
D. net domestic product

38. A fall in national output will necessitate
A. a rise in expenditure on imports
B. a rise in the level of savings
C. an increase in the consumption of expenditure
D. a rise in the standard of living

39. The demand for money to take advantage of changes in bond prices is the

A. unforeseen motive
B. transaction motive
C. speculative motive
D. precautionary motive

40. Cost push inflation is caused by a

A. rise in the cost of production
B. decrease in the transportation cost
C. rise in demand for goods
D. decrease in the cost of production

41. Deposit held in a commercial bank are part of

A. money supply
B. transfer payments
C. ordinary shares
D. treasury bills

42. One profitable form of business undertaken by the commercial banks is

A. the issuing of cheques
B. the payment of standing order
C. lending money to borrowers
D. accepting cheques from customers

43. When governments wants to discourage consumption, they tax goods whose demand is

A. price inelastic
B. abnormal in nature
C. price elastic
D. normal in nature

44. A rise in government expenditure can lead to

A. higher inflation
B. higher unemployment
C. lower profits for industries
D. lower importation of raw materials by industries

45. Tariff is used to protect domestic industries by making foreign goods relatively

A. cheaper in the domestic market
B. more expensive in the domestic market
C. more expensive in the international market
D. cheaper in the international market

46. The process of increasing the real per capital income and effecting changes in various sectors of the economy is known as

A. economic acceleration
B. economic development
C. economic integration
D. economic growth

47. Development plans in the West Africa tend to deviate from their targets mainly due to

A. political instability
B. lack of man power
C. high population growth rate
D. low level of education

48. The balance trade is

A. an annual statement showing transaction within a country
B. the relationship between the country’s visible exports and imports
C. the relationship between country’s receipt from visible and invisible trade
D. an account that shows a country’s payments to other countries

49. As one of the instruments of commercial policy, quota is

A. a qualitative restriction on imports
B. a normal restriction on imports
C. a quantitative restriction on imports
D. an outright prohibition of imports

50. The full meaning of IMF is

A. International Military Force
B. International Monetary Fund
C. International Mortgage Fund
D. International Monetary Financing



ANSWERS

Q#Ans Q#Ans
1C 26A
2A 27B
3A 28D
4D 29A
5A 30C
6D 31B
7D 32D
8C 33A
9A 34C
10B 35B
11A 36B
12A 37C
13B 38A
14A 39C
15B 40A
16A 41D
17B 42C
18B 43A
19A 44A
20A 45B
21A 46B
22A 47A
23B 48B
24A 49C
25D 50B

Document

1. Which of the following problems arises where there are more than one technically possible methods of production

A. Where to produce
B. for whom to produce
C. how to produce
D. what to produce

2. Visible balance is also known as

A. terms of trade
B. balance of payments
C. balance of trade
D. capital balance

3. A shift in the demand curve indicates

A. exceptional demand
B. change in demand
C. change in quantity demanded
D. elasticity of demand

4. If a 6% decrease in price results in more than 6% decrease in quantity supplied, supply can be regarded as

A. elastic
B. unitary elastic
C. perfectly inelastic
D. perfectly elastic

5. A condition for consumer utility maximization is

A. equality of the ratio of marginal utilities and the ratio of prices
B. equality of the ratio of average utilities and the ratio of prices
C. equality of the marginal utility to total utility ratio for both commodities
D. total utility and marginal utility must be zero

6. Which of the following best describes the mode? The

A. observation with the highest frequency
B. average of two middle numbers
C. item that occupies the middle position
D. difference of two extreme values

7. Where a commodity takes an insignificant proportion of the consumer's income, demand for it will be

A. unitary elastic
B. price inelastic
C. fairly elatic
D. income inelastic

8. A demand schedule shows the quantities of goods that are

A. bought at given price at a time
B. supplied at given prices at a time
C. produced at given prices at a time
D. reserved for future consumption

9. The demand curve for a commodity is downward sloping because the consumer will pay

A. less as the marginal utility falls
B. more as the marginal utility falls
C. less as the total utility falls
D. more as the average utility falls

10. A decrease in the demand for a product X resulted in a decrease in the demand for another product Y. The demand for X and Y is

A. derived
B. composite
C. joint
D. competitive

11. Any price below the equilibrium price will lead to

A. increase in supply
B. excess demand
C. equality of demand and supply
D. decreases in demand

12. The allocation of goods and services in a free market economy is performed by

A. the price system
B. the banking system
C. the central planning body
D. government budgets

13. Given the demand function Qd=20-$\frac{1}{2P}$. What is Qd when P is 12?

A. 6 units
B.10 units
C.12 units
D.14 units

14. If a particular consumer derives total utility of 22 utils having consumed 4 units of a given product, his average utility will be

A.88 utils
B.18 utils
C.5.5 utils
D.3.5 utils

15. The law of diminishing marginal utility applies to a

A. firm which minimizes cost
B. consumer who maximizes satisfaction
C. producer who maximizes marginal product
D. consumer who minimizes total utility

16. Why is the law of diminishing returns a short run phenomenon?

A. all inputs are fixed
B. all inputs are variable
C. some outputs are variable
D. some inputs are variable

17. Which of the following is capable of increasing the population of a country?

A. increase in birth rate
B. increase in death rate
C. poor medical facilities
D. decrease in birth rate

18. In the firm's production process, marginal cost

A. falls continuously throughout
B. falls and later rises
C. remains unchanged throughout
D. rises and later falls

19. If a firm's price is less than average cost but more than part of variable cost, the firm is covering

A. all of its fixed cost and variable cost
B. all of its fixed cost and part of variable cost
C. all of its variable cost and part of fixed cost
D. part of its fixed cost and part of varible cost

20. An arrangement in which the debts of a company can only be paid from its own assets implies

A. unlimited liability
B. transferred liability
C. limited liability
D. capital liability

21. One reason why small scale businesses are very common in West Africa is that

A. they can easily float shares
B. their management boards are easily formed
C. their initial capital is easy to rise
D. their dividend payments are very regular

22. A public limited company could finance its operations through

A. government taxes
B. equity shares
C. dividend payments
D. import duties

23. The factor of production which takes the initiative in combining resources for production is known as

A. capital
B. land
C. entrepreneur
D. labour

24. The type of monopoly that develops as a result of granting patent right is known as

A. natural monopoly
B. state monopoly
C. legal monopoly
D. discriminating monopoly

25. Which of the following is a function of a retailer?

A. Banking services
B. Hoarding services
C. Storage services
D. Sales services

26.Which of the following is a function of a retailer?

A. Banking Services
B. Hoarding services
C. Storage services
D. Sales services

27.The difference between the number of immigrants and emigrants is

A. natural growth rate
B. natural increase
C. net migration
D. census

28. All of the following is the features of optimum population except

A. full employment of available resources
B. unlimited amount of unexploited resources
C. maximum per capita production and income
D. high standard of living

29. The financial institution that specializes in risk spreading is called

A. an investment bank
B. a development bank
C. an insurance company
D. the stockexchange

30. The following are means of reducing the population of a country except encouraging

A. emigration
B. family planning
C. early marriage
D. sex education

31. Which of the following features best describes peasant agriculture in West Africa? It

A. specializes in the production of one crop
B. involves the use of small farm holdings
C. is a capital-intensive system of farming
D. is mostly associated with tree crops

32. One of the problems facing industrial development in West African countries is

A. inadequate large market
B. inadequate infrastructure
C. inadequate supply of labour
D. unavailability of natural resources

33. In a situation where the finished product of an industry is fragile, bulky and perishable, such an industry should be located close to its

A. raw materials
B. market
C. labour supply
D. power supply

34. If Y = income, C = Consumption, I = Investment, X = Export and M = Import, then national income is

A. Y = C - I + (x +m)
B. Y = C + I + (x + m)
C. Y = C +I +(X - M)
D. Y =C + I + (m - x)

35. The national income is the

A. Gross Domestic Product at market prices
B. Gross National product at factor cost
C. Net National Product at factor cost
D. Net National Product at market prices

36. When depreciation is deducted from Gross National Product, the result is

A. total national income
B. gross domestic product
C. net national product
D. net domestic product

37. Mr Akpoti has meat and wants maize, while Mr, Adama has maize and wants meat.transation is possible because of

A. bank deposit
B. joint demand
C. scale of preference
D. double coincidence of wants

38. Which of the following is not a form of money?

A. coins
B. bank notes
C. bank balance
D. bank deposit

39. A price index as a statistic, measures

A. how the value of money changes over time
B. the volume of currency in the economy
C. the exchange rate of a country's currency
D. the composition of goods and services

40. The different between birth rate and death rate is known as

A. demographic transition
B. natural growth rate
C. migration rate
D. fertility rate

41. In open market operations, what the Central Banks sells or buys are

A. shares
B. debentures
C. securities
D. equities

42. The following are reasons for failure of agricultural policies in West Africa except

A. vague policy statements
B. negation of polices
C. creation of agro-service stations
D. provision of obsolete implements

43. A situation in which the estimated government revenue is less than the proposed expenditure for a given year can be described as

A. surplus budgeting
B. supplementary budgeting
C. balanced budgeting
D. deficit budgeting

44. An excise tax is imposed on goods

A. smuggled into the country
B. manufactured locally
C. imported into the country
D. seized by custom officials

45. Which of the following will not retard economic development in West Africa?

A. dependence on imports
B. population control
C. high level of illiteracy
D. low level of savings

46. When there is improvement in a country's terms of trade, it means that the country's

A.exports are cheaper relative to imports
B. imports are cheaper relative to exports
C. volume of imports has declined
D. volume of exports has declined

47. Which of the following is true about import substitution? It

A. helps in increasing exportation
B. is meant to reduce exportation
C. enables a country to curtail importation
D. enables a country to improve on importation

48. Balance of payments problem can be corrected through

A. increasing foreign reserves
B. increasing domestic borrowing
C. import promotion strategies
D. export promotion strategies

49. One of the reasons why government may erect a trade barrier is to

A. control foreign currencies
B. protect infant industries
C. promote importation
D. diversify the economy

50. Which of the following is not a function of the West African Development Bank?

A. Promotion of both private and public investments in member states
B. Financing and executing projects in member states
C. Promotion of social development of member states
D. harmonization of oil prices to the advantage of member states

ANSWER

Q# Ans Q# Ans
1C 26D
2C 27C
3C 28B
4A 29C
5A 30C
6A 31A
7B 32B
8A 33B
9C 34C
10C 35A
11B 36C
12A 37C
13D 38C
14C 39A
15B 40B
16A 41C
17A 42C
18B 43D
19A 44B
20C 45B
21C 46C
22B 47C
23C 48D
24C 49B
25C 50B

Document

1. The action of government to forgo road construction in order to provide more health facilities denotes

A. sound economic decision
B. opportunity cost
C. practicable government policy
D. scale of preference

2. In Economics , a market is defined as any

A. agreement made for consumers to buy all they need
B. agreement made for producers sell all their goods
C. agreement to sell commodities at low prices
D. arrangement whereby the buyers and sellers are in contact

3. Which of the following is not a function of an insurance company?

A. pooling resources together against risks
B. Mobilization of funds through premiums collected
C. Encouragement of investment by security of capital
D. collection of deposits from the public for investment

4. A debenture holder earns

A. commission
B. profits
C. fixed interest
D. quasi-rent

5. All economic systems must decide what to produce because

A. resources are not available
B. consumers want maximum satisfaction
C. resources are limited in supply
D. producers want maximum profit

6. Trade between two countries is known as

A. bilateral trade.
B. bilateria trade
C. multilateral trade
D. internal trade

7. In the balance of payments of a country, tourism is classified under

A. capital account
B. invisible trade
C. merchandise trade
D. official reserves

8. General rise in the price level induced by increased price of inputs is referred to as

A. run-away inflation
B. cost -push inflation
C. demand -pull inflation
D. imported inflation

9. Which of the following is a function of merchant banks?

A. Acting as bankers' bank.
B. Lending to the commercial banks as a last resort
C. controlling inflation in the economy
D. underwriting and issuing of shares

10. Demand is elastic when percentage in

A. quantity demanded is greater than percentage change in price
B. price is greater than percentage change in quantity demanded
C. price is equal to one
D. quantity demanded is zero

11. A budget is balance when expected total revenue is

A. greater than expected expenditure
B. less than total expenditure
C. equal to expected expenditure
D. greater than total expenditure

12. A co-operative society is a

A. finance house
B. self -help business organization
C. public corporation
D. non-democratic business organization

13. The value of money is effected by the

A. speculative motive
B. price level
C. precautionary motive
D. intervention of development

14. Which of the following is a function of money?

A. Medium of Communication
B. Measure of securities
C. Store of Wealth
D. Discounting bills of exchange

15. Which of the following is an asset of a commercial bank?

A. Reserve funds
B. Shareholders capital
C. Customers' deposits
D. Treasury bills

16. An increase in the supply of a commodity X automatically results in an increase in the supply of another commodity Y. This is a cause of

A. elastic supply
B. joint supply
C. exceptional supply
D. competitive supply

17. Why would an individual increase his level of consumption during inflationary periods?

A. The real value of any amount saved falls over time
B. Interest rates are generally low
C. There are varieties of goods to buy
D. Wages and salaries stagnate during inflation

18. The type of monopoly that develops as a result of uneven distribution of resources is called

A. legal monopoly
B. natural monopoly
C. state monopoly
D. international monopoly

19. A major disadvantages of partnership form of business is that

A. every partner has to be consulted during decision making
B. partners could be too friendly with their customers
C. affair can be kept private
D. partners could take long holidays

20. Goods which have to be paid for are known as

A. physical goods
B. economic goods
C. free goods
D. intangible goods

21. Goods are said to be in competitive demand when they are

A. substitutes
B. complementary
C. jointly demanded
D. identical

22. In the long term run factors of production are considered to be

A. at maximum
B. fixed
C. variable
D. increasing

23. Which of the following will shift the demand curve for cocoa to the right?

A. An increase in consumers' income
B. A rise in the price of cocoa
C. A tax on cocoa producers
D. A fall in the quantity demanded of cocoa

24. An agricultural production process which uses more machinery relative to labour is referred to as

A. large scale farming
B. capital intensive farming
C. commercial farming
D. land intensive farming

25. Which of the following will enhance productivity in an economy?

A. The use of obsolete capital
B. Technological change
C. Expansion of land under cultivation
D. An increase in the labour force

26. Post harvest losses in West African countries can be reduced if

A. the land tenure system could be reformed
B. more irrigation schemes could be provided
C. better storage facilities could be provided
D. erosion is controlled

27. Which of the following best explains what to produce?

A. How much goods are to be produced
B. The combination of resources to be used
C. Which goods and services to be produced
D. How many wants are to be satisfied

28. The demand for money is described as a

A. competitive demand
B. joint demand
C. derived demand
D. composite demand

29. Which of the following is the main outcome of a trade union's interference with the wage rate? Wages are

A. lowered but more employment opportunities are created
B. lowered but employment level remains unchanged
C. increased and employment levels are unchanged
D. increased but employment levels are reduced

30. The introduction of tariffs and quotas

A. reduce the prices of imports
B. increase the demand for locally made goods
C. discourage domestic industries from becoming more efficient
D. reduce the prices of locally made goods

31. A government that wants to get more revenue will increase the tax on commodities with a

A. high price elasticity of demand
B. low price elasticity of demand
C. high income elasticity of demand
D. low income elasticity of demand

32. Which of the following is involved in the money market?

A. Building society
B. Development banks
C. Commercial banks
D. Stock exchange

33. Demand pull inflation can aptly be described as

A. inflation induced by rising costs of production
B. reduction in government expenditure
C. persistent rise in prices due to increase in expenditure
D. massive importation of goods from a country with hyper inflation

34. In order to develop the banking habit of rural dwellers, the traditional money lenders should be

A. proscribed
B. legalized
C. subsidized
D. heavily taxed

35. All rates of interest in a country are influenced by the

A. bank rate
B. population growth rate
C. wage rate
D. mortgage rate

36. Exchange control is a weapon used in regulating

A. barter trade
B. stock exchange
C. foreign trade
D. internal trade

37. When the marginal product is negative, the total product will be

A. constant
B. at a maximum
C. increasing
D. decreasing

38. Physical productivity is affected by all the under listed factors except the

A. state of technology
B. quantity of inputs
C. quality of inputs
D. price of output

39. If a commodity has a high marginal utility, its market price will be

A. stable
B. high
C. zero
D. constant

40. Price fluctuation is a feature of

A. common market
B. imperfect market
C. supermarkets
D. market failure

41. Which of the following statements is not a feature of a monopoly?

A. Seller is allowed to fix his own price
B. Buyers and sellers are price takers
C. New entrances are restricted
D. There is only one seller of the commodity

42. The following are advantages of sole proprietorship except

A. quick and easy decision-making
B. keeping its business affairs private
C. assurance of raising huge capital for expansion
D. high level of commitment

43. Which of the following controls a limited liability company?

A. the general manager
B. the managing director
C. tax payers
D. the board of directors

44. Given that Qd = 80 - 2p where Qd is quantity demanded and P is the price, what quantity would be demanded when the price (P) is 3?

A. 86 units
B. 80 units
C. 76 units
D. 74 units

45. Which of the following can be used to calculate the price elasticity of demand?

A.  $\frac{percentage \space change \space in \space quatity \space demand}{percentage\space change\space in \space price}$

B. $\frac{percentage \space change \space in \space price}{percentage\space change \space inquantity}$

C. $\frac{percentage \space change \space in \space quality \space demand}{percentage\space change\space in\space income}$

D.  $\frac{percentage \space change\space in \space income}{percentage \space change\space in \space quantity}$

46. The main advantage of large scale production is that

A. unit cost of production falls
B. decision -making is quick
C. worker-managemnet relationship is improved
D. the quality of the product increases

47. Which of the following items is not included in measuring national income by the income approach?

A. Profits of companies
B. Rents on property
C. Student's grants and scholarships
D. Wages and salaries of public servants

48. Gold, diamond, iron ore and limestone are collectively referred to as

A. human resources
B. mineral resources
C. artificial resources
D. forest resources

49. Points outside a production possibility curve indicate

A. unattainable production levels
B. attainable production levels
C. inefficient, but attainable production levels
D. optimum production levels

50. The International Bank for Reconstruction and Development (IBRD) is important to developing nations because it

A. gives aid for defence
B. offers loans for public projects
C. offers aid to finance private projects
D. gives loans for legal proceedings

ANSWERS

Q# Ans Q# Ans
1B26C
2D27C
3D28C
4D29C
5D30B
6A31B
7B32C
8B33C
9D34C
10A35A
11C36C
12B37D
13B38D
14B39B
15B40B
16B41B
17A42C
18A43D
19A44D
20B45C
21A46A
22C47C
23A48B
24C49A
25D50B