Jamb Economics (2023) Questions and Answers 1 – 10
1. In the circular flow of income model, the outflow variables represent _____
(a) Injections
(b) Income
(c) Leakages
(d) Expenditure
The correct answer is: (c) Leakages
2. A reduction in the bank rate encourages commercial banks to creat money by _____
(a) Decreasing the interest rate
(b) Maintaining the interest rate
(c) Raising the interest rate
(d) Doubling the interest rate
The correct answer is: (b) Maintaining the interest rate
3. A persistent rise in the prices of input will lead to _____
(a) Hyperinflation
(b) Stagflation
(c) Cost-push inflation
(d) Demand-pull inflation
The correct answer is: (c) Cost-push inflation
4. The production possibility curve can be used to explain the underlying concepts of _____
(a) Scale of preference and choice
(b) Opportunity cost and scale of preference
(c) Wants and means
(d) Opportunity cost and scale of preference
The correct answer is: (b) Opportunity cost and scale of preference
5. Given that Qd = 20 – 4P and Qs = 6P + 12. Determine the equilibrium quantity
(a) 14.2
(b) 16.8
(c) 20.8
(d) 30.2
The correct answer is: (b) 16.8
6. If the price is increased to 3 naira, how much is the excess supply?
(a) 30
(b) 22
(c) 12
(d) 8
The correct answer is: (b) 22
7. As long as marginal utility is positive, total utility must be _____
(a) Negative
(b) Increasing
(c) Zero
(d) Decreasing
The correct answer is: (b) Increasing
8. A cummulative frequency graph is _____
(a) A histogram
(b) An ogive
(c) A bar chart
(d) A pie chart
The correct answer is: (b) An ogive
9. A supply curve is positively slope because _____
(a) Supply always exceeds demand
(b) Demand always exceed supply
(c) Price is an incentive to consumers
(d) Price is an incentive to producers
The correct answer is: (d) Price is an incentive to producers
10. In a regulated market, price is determined by _____
(a) Consumers
(b) Producers
(c) Auction
(d) Government
The correct answer is: (d) Government
Jamb Economics (2023) Questions and Answers 11 – 20
11. A decrease in supply without a corresponding change in demand will lead to _____
(a) An increase in equilibrium quantity and decrease in equilibrium quantity
(b) A decrease in equilibrium price and an increase equilibrium quantity
(c) A decrease in equilibrium price and equilibrium quantity
(d) An increase in equilibrium price and quantity
The correct answer is: (a) An increase in equilibrium quantity and decrease in equilibrium quantity
12.In the circular flow of income, an increase in savings causes _____
(a) An increase in imports
(b) A decrease in the income stream
(c) An increase in household consumption
(d) A decrease in exports
The correct answer is: (b) A decrease in the income stream
13. If MPC is 0.7 while government expenditure increased by #150M, the equilibrium national income is _____
(a) #214 million
(b) #45 milion
(c) #105 million
(d) #500 million
The correct answer is: (d) #500 million
14. By buying treasury bills, the Central Bank of Nigeria intends to _____
(a) Increase money supply in the economy
(b) Reduce money supply in the economy
(c) Reduce the cash reserve ratio for banks
(d) Increase the capital base of commercial banks
The correct answer is: (a) Increase money supply in the economy
15. If real income increases while nominal income remains the same, it can be inferred that _____
(a) Unemployment rate has decreased
(b) General prices have fallen
(c) Employment rate has risen
(d) General prices have risen
The correct answer is: (b) General prices have fallen
16. In modern economics, the Malthusian theory of population is ineffective because of _____
(a) Birth control measures
(b) Technical progress
(c) Government policies
(d) Natural disasters
The correct answer is: (b) Technical progress
17. The speculative demand for money is inversely related to the _____
(a) Interest rate
(b) Inflation rate
(c) Level of income
(d) Exchange rate
The correct answer is: (a) Interest rate
18. Given the cost function C = 160 + 36Q, what is the average cost at 20 units of outpus?
(a) #44.00
(b) #720.00
(c) #880.00
(d) #216.00
The correct answer is: (a) #44.00
19. Economic growth is different from economic development because economic growth _____
(a) Describes expansion and change
(b) Describes expansion and not change
(c) Is not measurable but objective
(d) Is measurable but not objective
The correct answer is: (b) Describes expansion and not change
20. Devaluation is effective when _____
(a) Demand for imports is price inelastic
(b) Demand for exports is price elastic
(c) Demand for imports is neutral
(d) Production for exports is low
The correct answer is: (b) Demand for exports is price elastic
Jamb Economics (2023) Question and Answers 21 – 30
21. If national income rises by 6% and population rises by 3%, per capita income will _____
(a) Fall by 6%
(b) Fall by 3%
(c) Rise by 3%
(d) Rise by 6%
The correct answer is: (c) Rise by 3%
22. The demand for money which involves making provision for rainy day is known as _____
(a) Speculative motive
(b) Precautionary motive
(c) Investment motive
(d) Transactions motive
The correct answer is: (b) Precautionary motive
23. The function of money which makes it possible for someone to provide for old ages is _____
(a) Medium of exchange
(b) Measure of value
(c) Unit of account
(d) Store of value
The correct answer is: (d) Store of value
24. Differentiated product is a feature is _____
(a) Perfect competition
(b) Pure competition
(c) Monopolistic competition
(d) Monopoly
The correct answer is: (c) Monopolistic competition
25. The burden of tax on a commodity whose demand is infinitely inelastic _____
(a) Is zero
(b) Will be borne by seller alone
(c) Will be borne by buyer alone
(d) Will be borne by both seller and buyer
The correct answer is: (c) Will be borne by buyer alone
26. Disposable income equals _____
(a) Personal income less business profits
(b) Personal income less taxes and subsidies
(c) National income less borrowing from abroad
(d) Personal income less taxes plus subsidies
The correct answer is: (d) Personal income less taxes plus subsidies
27. Which of the following is NOT a measure for controlling inflation?
(a) Reduction in money supply
(b) Wage restraint and wage freeze
(c) Reduction in taxes and increase in government spending
(d) Price control
The correct answer is: (c) Reduction in taxes and increase in government spending
28. Which of the following is not a direct tax?
(a) Company income tax
(b) Capital gain tax
(c) Purchase tax
(d) Personal income tax
The correct answer is: (c) Purchase tax
29. The principle of comparative advantage is not based on one of the following assumptions
(a) There are restrictions in trade
(b) There are no costs of transportation
(c) There are only two countries and only two commodities entering into international trade
(d) There is perfect competition
The correct answer is: (d) There is perfect competition
30. Tax which takes a higher percentage from higher income is _____
(a) A regressive tax
(b) A progressive tax
(c) A proportional tax
(d) An indirect tax
The correct answer is: (b) A progressive tax
Jamb Economics (2023) Question and Answers 31 –
31. A normal good with close substitutes is likely to have its price elasticity of demand _____
(a) Between zero and one
(b) Equal to unity
(c) Less than unity
(d) Greater than unity
The correct answer is: (d) Greater than unity
32. A country’s import price index by 1995 was 50 and her index of export price was 70. Calculate the terms of trade
(a) 20%
(b) 71%
(c) 120%
(d) 140%
The correct answer is: (d) 140%
33. Exclusions that make Gross National Product a poor measure of welfare are _____
(a) Government purchase
(b) Government military outlays
(c) Wages and salaries
(d) Housewives services
The correct answer is: (d) Housewives services
34. An increase in money supply, other things being equal will _____
(a) Lower interest rates
(b) Reduce income
(c) Ensure trade balance
(d) Increase money demand
The correct answer is: (d) Housewives services
35. A persistent rise in the general price level implies _____
(a) An increase in some prices
(b) A one-time rise in prices
(c) A steady fall in the purchasing power of money
(d) That the higher the price level, the more the value of money
The correct answer is: (c) A steady fall in the purchasing power of money
36. If the labour in a given community is 2,000,000 wage employment 200,000 and the unemployed are 80,000, what is the unemployment rate in the community?
(a) 0.4%
(b) 40.0%
(c) 10.0%
(d) 4.0%
The correct answer is: (d) 4.0%
37. The technical relationship between input combination and maximum attainable output is called
(a) A production function
(b) An indifference curve
(c) An isocost
(d) An isoquant
The correct answer is: (a) A production function
38. A buyer who haggles in the market is applying the principle of _____
(a) Choice
(b) Price mechanism
(c) Opportunity cost
(d) Utility mechanism
The correct answer is: (d) Utility mechanism
39. A major advantage of industrialization is that is _____
(a) Leads to self-reliance
(b) Curbs inflation
(c) Leads to growth and development
(d) Improves the terms of trade
The correct answer is: (c) Leads to growth and development
40. Given that Y=C+I and C = a + by where b = 0.8, what is the multiplier?
(a) 4
(b) 2
(c) 10
(d) 5
The correct answer is: (d) 5