2015 JAMB ECONOMICS PAST QUESTIONS AND ANSWERS

A high dependency ratio indicates a large proportion of the population is not working (e.g., children, elderly), leading to a vicious cycle of poverty as economic resources are strained to support dependents. High capital formation and low cost of living are not direct outcomes of high dependency ratios.

Nigeria’s agricultural sector faces the challenge of inadequate modern farm implements, which hampers productivity. While small farm sizes, pest attacks, and low literacy are issues, modern implements are crucial for improving efficiency and output.

Cooperative societies allow free entry and exit, promoting inclusivity and ease of membership. They may have limited liability, but the unlimited size of membership and diverse interests are not defining features.

Marginal propensity to save (MPS) is the ratio of change in saving to change in income, showing how much of each additional unit of income is saved rather than spent. Average propensity to consume and supply changes relate to different concepts.

Structural unemployment results from changes in industry or technology that make certain skills obsolete. Seasonal variations and business cycles affect cyclical unemployment, not structural.

Distortion of census figures is common in Nigeria due to political, ethnic, and resource allocation influences. High costs and lack of skilled personnel are issues but not as critical as figure distortion.

Reduced government spending leads to a decrease in aggregate demand, causing the general price level to fall. Rising prices would be contrary to this action, and fluctuation is less likely without external shocks.

Here, K and F would logically be 27 and 13 based on typical AP and MP values in production data, though without more specifics this is estimated from similar examples.

The total utility is the cumulative satisfaction gained from consuming goods, summing all marginal utilities. Average marginal utility or diminishing marginal utility describes different aspects of utility.

In capitalism, the private sector owns and controls production, unlike mixed economies where public sectors also participate. Feudal lords, public-private sectors, or public sectors alone do not dominate capitalist ownership.

Unemployment benefits, often termed transfer payments, are government funds given to unemployed individuals to support them financially without requiring a service in return.

Excess supply on a supply-demand graph is shown when quantity supplied surpasses quantity demanded, creating surplus. Equilibrium points align both demand and supply, while excess demand is the opposite condition.

The desire to hold money in liquid form for transactions rather than investments defines the demand for money, highlighting the trade-off between liquidity and potential investments. Intangible assets or fixed deposits do not describe liquid forms in this context.

Production equilibrium occurs when the isoquant is tangent to the isocost curve, meaning the cost-efficient combination of inputs for maximum output. Other positions are either inefficient or non-equilibrium.

Balance of trade reflects the total value of visible imports and exports, indicating a country’s trade surplus or deficit. Internal and external trade, balance of payments, and invisible imports/exports are distinct economic measures.

With a 30% reserve ratio, the money multiplier is 1 / 0.3 = 3.33. So, ₦20 million × 3.33 = ₦66.7 million as the increased money supply.

For ostentatious (luxury) goods, a price drop may actually decrease quantity demanded because these goods’ value often comes from their high price and exclusivity.

Debt servicing is the ongoing payment of interest and periodic repayment of the principal on a loan, ensuring the debt remains current. Debt relief and retaking are not accurate terms for this concept.

Mode is challenging in grouped data as it requires identifying the class interval with the highest frequency. Mean and variance calculations are straightforward with grouped data.

Access to raw materials is a primary factor, as industries often locate close to essential resources to reduce transportation costs and increase efficiency. Population growth and division of labor are less relevant to industrial localization.

The availability of agricultural land influences population distribution, as people tend to settle in fertile areas for food production. Birth rates and skilled manpower have indirect effects.

If demand is unitary elastic, the tax burden splits evenly between consumers and producers because the percentage change in demand equals the price change due to the tax. Other elasticity levels shift the burden more to one side.

Demand-pull inflation can be controlled by raising income taxes, which reduces disposable income and demand, easing inflationary pressure. High interest rates and cost-push inflation require different interventions.

A rightward shift in supply, as depicted, causes decreased prices and increased quantities, as more goods are supplied at each price level.

Indifference curves represent combinations of goods that give the consumer equal satisfaction, forming an indifference map that helps analyze preferences without budget constraints.

Recapitalization provides banks with a stronger capital base, allowing them to absorb risks, offer loans, and handle larger financial responsibilities. Employing workers or opening branches are benefits, but capital base is the core purpose.

A private company requires two to fifty members, allowing for small ownership without public stock issuance. Public companies, in contrast, have more expansive ownership.

The International Monetary Fund (IMF) aims to maintain stable exchange rates and support global economic stability by providing short-term loans to manage economic crises. It does not focus on agriculture or long-term infrastructure loans.

Exploration of crude oil is a primary activity in the upstream sector, focusing on discovering and extracting oil. Downstream activities include refining and marketing.

According to the law of supply, higher prices incentivize producers to supply more, resulting in a positive relationship between price and quantity supplied. Lower prices reduce supply.

Absence of transportation cost is assumed in perfect competition, alongside many sellers and identical products. Price discrimination and product differentiation are absent.

Differences in natural resource endowments among countries create opportunities for trade, as nations export goods they produce efficiently. Population and interest rates affect trade but are not the basis.

Extension workers provide training and support to farmers, enhancing productivity and knowledge of modern techniques. Middlemen and creditors are not primarily responsible for training.

In a free market, demand and supply forces set prices, without direct government intervention. Producers and consumers influence, but do not fully control, pricing.

The availability of resources guides production choices in an economy, balancing needs with limited resources. Labor and technology impact how, not what, to produce.

Reduced petrol supply raises the general price level as production and transportation costs increase, impacting various goods and services. Import-export levels and exchange rates are indirectly affected.

Equilibrium in perfect competition occurs where the marginal cost (MC) equals marginal revenue (MR), ensuring profit maximization. Demand curves are tangential in monopoly, not perfect competition.

A maximum price (price ceiling) caps prices to prevent exploitation, especially for essentials. Minimum prices support producers rather than consumers.

Substitutes see an inverse price-demand relationship, as consumers switch to cheaper options. Complements would see joint demand changes.

The elasticity of demand for an input affects its pricing, reflecting its importance in production. Large markets and exchange rates impact demand but are not direct determinants.

The modal score is the most frequently occurring score, commonly represented by the highest bar on a histogram.

Pricing below marginal cost indicates losses, as the cost to produce exceeds the revenue generated per unit.

National income estimates capture an economy’s total output, consumption, and production levels, providing a reliable performance indicator. Employment and balance of payments are specific but not comprehensive measures.

Technology drives agricultural productivity, enabling higher yields and efficient resource use. Consumers’ preferences are influenced but do not dictate supply.

Arranged data: 4, 5, 6, 10, 12, 18, 20, 20. With eight numbers, median is the average of the 4th and 5th: (10 + 12) / 2 = 11.

Range = Highest value – Lowest value: 70 – 10 = 60.

Underdeveloped infrastructural facilities hinder efficient production, distribution, and communication, crucial for industrialization. Raw materials and capital issues also affect development but are not the main problem.

Substitute P in Qd = 40 – 4P: Qd = 40 – 4(4) = 24 units.

All factor inputs reflect total costs, covering both variable and fixed expenses over time. Fixed factors alone would refer to only fixed costs.