Sample Economics Question For SSS2

 

INSTRUCTION: Each question is followed by four options lettered A to D. Choose the correct option for each question.

1.      Economic problems arise in all societies because

a.      Resources are mismanaged by leaders

b.      There is no proper planning

c.       Resources are not in adequate supply

d.      The services of economists are not employed

2.      Which of the following is not emphasized in the production possibility curve?

a.      Scarcity of resources

b.      Economic development

c.       Inefficiency in the use of resources

d.      Unemployment of labour

3.      The organization of productive factors is the responsibility of the

a.      management

b.      entrepreneur

c.       production manager

d.      labour union

4.      producers operating in free market economy are more efficient as a result of 

a.      the existence of competition

b.      the very few number of participants

c.       the commitment of the shareholders

d.      government’s regulation of their activities

5.       In a pie chart, the population of a city is represented by the sector 45o. if the country has a population of 10 million people, then the city’s population is  

a.      0.0045 million

b.      4.5 million

c.       1.25 million

d.      16 million

6.      A downward sloping demand curve means that

a.      Total revenue declines as price is lowered

b.      Demand falls as output rises

c.       Demand falls as output falls

d.      Price must be lowered to sell more.

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

a.      substitutes

b.      complements

c.       inferior goods

d.      bought together

8.      Goods whose demand vary directly with money income are called

a.      Inferior goods

b.      Complementary goods

c.       Substitute goods

d.      Normal goods

9.      An exceptional demand curve can result from

a.      Increase in price of raw materials

b.      Increase in the size of the population

c.       Expectation of future price increase

d.      Change in taste of the consumer

10.  Palm oil and palm kernel are in

a.      Joint supply

b.      Competitive demand

c.       Competitive supply

d.      Complementary demand

11.  Which of the following is true about the supply of land? it

a.      Is higher in the urban than in rural area

b.      Varies with time

c.       Rises with demand

d.      Is fixed

12.   The backward bending supply curve of labour indicates

a.      An abnormal supply situation

b.      The law of supply

c.       That labour supply and wages are directly related

d.      That the elasticity of supply is uniform

13.  Supply curve parallel to X axis indicates 

a.      Fairly elastic supply

b.      Infinitely elastic supply

c.       Fairly inelastic supply

d.      Perfectly inelastic supply

14.  If the marginal utility of a commodity is equal to its price, then

a.      The consumer is in equilibrium

b.      More of the commodity can be consumed

c.       Total utility is always equal to its price

d.      The market is not in equilibrium

15.  A price floor is usually fixed  

a.      At the equilibrium and causes no shortage

b.      Above the equilibrium and causes shortage

c.       Below the equilibrium and causes surpluses

d.      Above the equilibrium and causes surpluses

16.  A market is in equilibrium when

a.      There is no government intervention

b.      The demand is the same as the supply

c.       Buyers and sellers are free to sell more goods

d.      There is no free entry and exit

17.  A firm’s average cost decreases in the long-run because of  

a.      Increasing return to scale

b.      Diminishing average returns

c.       Decreasing marginal returns

d.      Decreasing average fixed cost

18.  The larger a firm, the lower its cost of production. This statement explains the

a.      Law of diminishing returns

b.      Concept of economies of scale

c.       Law of comparative cost advantage

d.      Theory of division of labour

Use the table below to answer questions 19 & 20

Quantity

0

      1

   2

3

     4

     5

    6

    7

Total cost

20

    25

  28

30

    35

    55

   92

  135

 

19.    The total fixed cost is

a.       $ 7.00

b.      $ 30.00

c.       $ 20.00

d.      $ 135.00

20.   At output level 5, the total variable cost is

a.      $ 5.00

b.      $ 20.00

c.       $ 55.00

d.      $ 35.00

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

a.      Greater than average cost

b.      Less than average variable cost

c.       Equal to the minimum average cost

d.      Equal to the average cost

22.  Public limited liability companies are democratic in nature because

a.      Government appointees are members of the board

b.      They are run by elected public officers

c.       Electoral principles are adopted in the day-to-day management

d.      Shareholders elect the board of directors

23.  In the event of bankruptcy, owners of joint-stock companies lose

a.      Their private properties

b.      Both company and private assets

c.       Only the capital invested

d.      Only their dividends

24.  Wholesalers play an important role in the distribution of goods and services because they

a.      Located very close to the consumers

b.      Finance both producers and retailers

c.       Pass information on from retailers to consumers

d.      Sell in small units to consumers

25.  If worker at the food canteen cannot sell during the holidays, this is an example of  

a.      Structural unemployment

b.      Frictional unemployment

c.       Seasonal unemployment

d.      Residual unemployment

26.  Positive checks as envisaged by Thomas Malthus can be prevented if  

a.      Death rate is reduced

b.      Marriage is abolished

c.       More hospitals are built

d.      Moral restraint is adopted

27.  Which of the following factors is not a reason for farmers’ unstable incomes?

a.      Dependence on too many crop

b.      Poor storage facilities

c.       Adverse weather conditions

d.      Recession in the world

28.  Local firms can help in reducing unemployment in a country when

a.      Land acquisition becomes centralized

b.      Imports of substitution are reduced

c.       Waste in the is eliminated

d.      Subsidies to firms are decreased

29.  An industry is described as a group of firms

a.      That provides jobs for many people

b.      Which uses advance technology in production

c.       Which produces similar products

d.      That provides jobs for few people

30.  A baker bought flour and other ingredients for $250.00, spent $ 52.00 on distribution sold the bread for $ 320.00. The value added by the baker is

a.      $ 302.00

b.      $ 52.00

c.       $ 18.00

d.      $ 622.00

31.  In a country with large population of full-time housewives, national income

a.       Will be composed of goods produced by women

b.      Figures will be grossly over-stated

c.       Statistics will be difficult to calculate

d.      Figures will be grossly under-estimated

32.   Holding money to take care of contingencies is

a.      A speculative motive

b.      A transactions motive

c.       A precautionary motive

d.      An expansionary motive

33.  Demand-pull inflation is likely to be caused by

a.      An increase in the cost of factor inputs

b.      Increase in the income tax rate.

c.       Increase in bank lending rate

d.      Increasing large budget deficit

34.  If a housewife has meat and wants tomatoes. She must find someone who has tomatoes to give and want meat. This concept is described as

a.      Scale of preference

b.      Opportunity cost

c.       Complementary demand

d.      Double coincidence of want

35.  The stock exchange market is an example of the

a.      Labour market

b.      Money market

c.       Commodity market

d.      Capital market

36.  An electrical engineer who is teaching Physics in secondary school is said to be

a.      underemployed

b.      unemployed

c.       fully employed

d.      technologically unemployed

37.  One benefit a country can derive from the extraction of crude oil is increase in   

a.      population

b.      employment

c.       money supply

d.      demand for import

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

a.      Iron rod

b.      Wild life

c.       Solar energy

d.      Gold

39.  The following are characteristics of labour, except that it

a.      Is immobile

b.      Needs motivation

c.       Receives wages and salaries

d.      Controls other factors of production

40.  Goods consumed out of habit have

a.      Elastic demand

b.      Inelastic demand

c.       Unitary elastic demand

d.      Perfectly elastic demand

THEORY

 

1.      The utility schedule of a consumer for a brand of ice cream is shown in the table below. Use the information to answer the questions that follow:

Units consumed (Q)

Total utility (TU)

Marginal utility (MU)

0

0

  

1

10

10

2

19

R

3

P

6

4

30

5

5

31

S

6

Q

0

7

29

-2

 

a.      Calculate the values of P,Q,R and S.

b.      Given that the price of ice cream is $1.00 per unit, at what level of consumption is the consumer at equilibrium?

c.        Using a graph sheet, draw the marginal utility curve.

2.      The table below represents the cost function of a poultry farm. The price of a crate of egg is $21. Use the information contained in the table to answer the questions that follows.

Quantity of eggs (in crates)

Total Cost (in $)

0

50

1

55

2

62

3

75

4

96

5

125

6

162

7

203

8

248

 

a.      What is the fixed cost of the farm?

b.      (i) Calculate the marginal cost at each level of output. (ii) What is the profit maximizing output of the farm?

c.       Using graph sheet, draw the demand curve for the farm.

3.      a. Define optimum population.

b. In what threeways can rapid population growth slow down the rate economic development?

c. Describe any threemeasures that can be adopted to control rapid population growth.

4.      a. Differentiate between unemployment and underemployment.

b. With oneexample each, explain the following:

    (I)  seasonal unemployment.

    (ii) structural unemployment.

    (iii) frictional unemployment.       

    (iv) cyclical unemployment.

5.      a. What are state-owned enterprises?

b. State any threereasons for the establishment of state-owned enterprises.

c. Highlight any fourproblems associated with state-owned enterprises.

6.      a. (i) What is trade union? (ii) Outline any two weapons used by trade union to achieve their objectives

b. Describe any four functions of trade unions.

7.      a. What is Money?

      b. Identify any three problems associated     with trade by barter.

      c. Explain any three ways by which the          advent of money has solved the problems     of the barter system.

8.      a. What is a centrally planned economy?

b. (i) Outline any four features of a capitalist economy. (ii) Outline any four features of a socialist economy.

CONTINUE READING>>>

Leave a comment

Your email address will not be published.