JAMB Economics: practice questions.

Question 1 · Industry and industrialization

Which of the following would MOST likely keep a firm small?

1. A.Easy access to large bank loans
2. B.Economies of scale in production
3. C.Mass demand for its product
4. D.A small, localised market for its product

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Question 2 · The theory of price determination

Strict rent control that keeps rents in Lagos well below market level is MOST LIKELY to result in the long run in

1. A.fewer houses being built for rent
2. B.rents rising above the market level legally
3. C.a surplus of vacant flats
4. D.landlords building more flats

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Question 3 · Money and inflation

A basket of goods cost a household in Ibadan ₦20,000 in the base year and ₦26,000 in the current year. The consumer price index for the current year is

1. A.76.9
2. B.30
3. C.6000
4. D.130

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Question 4 · Methods and tools of economic analysis

The daily sales (in bags) of rice by a trader in Kano market for one week were: 10, 14, 14, 16, 21, 23, 28. What is the median?

1. A.14
2. B.19
3. C.16
4. D.18

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Question 5 · Economic systems

Which of the following is a main feature of a free enterprise (capitalist) economy?

1. A.Private ownership of the means of production
2. B.Collective ownership of all land
3. C.Central planning authority fixes all prices
4. D.Absence of competition among producers

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Question 6 · Theory of costs and revenue

A sachet-water firm in Ibadan has fixed costs of ₦240,000, sells each bag at ₦500 and has an average variable cost of ₦300. Its break-even output is

1. A.800 bags
2. B.1,200 bags
3. C.480 bags
4. D.300 bags

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Question 7 · The theory of price determination

If demand for yam increases while supply remains unchanged, equilibrium price and quantity will

1. A.fall and rise respectively
2. B.both fall
3. C.both rise
4. D.rise and fall respectively

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Question 8 · Agriculture in Nigeria

A bumper harvest of yam in a year when demand for yam is price-inelastic will MOST LIKELY

1. A.reduce the total income of yam farmers
2. B.raise the total income of yam farmers
3. C.leave farmers' income unchanged
4. D.raise the price of yam

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Question 9 · Economics as a science

A production possibility curve for Nigeria shows maximum combinations of cassava and cement. A point INSIDE the curve indicates that

1. A.the economy has experienced economic growth
2. B.some resources are unemployed or used inefficiently
3. C.the combination cannot be produced with present resources
4. D.the opportunity cost of cassava is zero only at that point

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Question 10 · Economic systems

In a centrally planned economy, the basic questions of what, how and for whom to produce are answered mainly by

1. A.the forces of demand and supply
2. B.consumers voting with their money
3. C.a central planning authority
4. D.traditional rulers and customs

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Question 11 · Economics as a science

An Onitsha trader who, faced with limited capital, chooses the stock that gives her the highest expected satisfaction or profit is said to be acting

1. A.rationally
2. B.normatively
3. C.altruistically
4. D.inductively

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Question 12 · Financial institutions

A customer deposits ₦100,000 in a deposit money bank in Kano. If the cash reserve ratio is 10% and all banks lend fully, the maximum total deposits that can be created in the banking system are

1. A.₦1,000,000
2. B.₦10,000
3. C.₦900,000
4. D.₦90,000

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