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SS3 Mock Examinations
Contributed by: Ajiboye
  • 1. What is the fundamental economic problem?
A) Inflation
B) Poverty
C) Unemployment
D) Scarcity
  • 2. Which economic system is characterized by private ownership?
A) Mixed
B) Command
C) Socialist
D) Capitalist
  • 3. What type of market structure has many buyers and sellers?
A) Monopoly
B) Monopsony
C) Oligopoly
D) Perfect Competition
  • 4. What is the purpose of fiscal policy?
A) All of the above
B) To control inflation
C) To reduce unemployment
D) To promote economic growth
  • 5. A Minimum price legislation is also called
A) Price Ceiling
B) Price control
C) Price floor
D) Price mechanism
  • 6. Which of the following factors is not a cause of change in demand? Changes in
A) income distribution
B) the size of the population
C) price of the commodity
D) taste and fashion
  • 7. If the quantity demanded of a commodity increases from 20 units to 30 units when there is an increase in price from $4.00 to $5.00, the elasticity of demand is
A) 2.00
B) 2.50
C) 0.65
D) 0.50
  • 8. The use of the bank rate, cash ratio and open market operations constitute
A) import policy
B) fiscal policy
C) export policy
D) monetary policy
  • 9. Scale of Preference shows
A) consumer’s wants in order of priority
B) utilities enjoyed by consumers
C) opportunity cost of goods consumed
D) Incomes of consumer in order of size
  • 10. Gross National Product (GNP) less the provision for the wear and tear of assets is the
A) net national product
B) net present value
C) net factor income
D) net indirect taxes
  • 11. In perfectly elastic supply, the supply curve
A) Slopes downward
B) Is Vertical
C) Slopes upward
D) Is Horizontal
  • 12. An example of transfer payments in national income accounting is
A) transfer of funds from one bank to another
B) money transferred to another country
C) unemployment allowance paid to the citizens
D) the amount paid to a worker on transfer
  • 13. Which of the following industries will add more value to primary products?
A) Processing industry
B) Construction industry
C) Service industry
D) Mining industry
  • 14. A consumer of a single commodity is in equilibrium when
A) his marginal utility is equal to zero
B) he can equate his marginal and total utilities
C) he equates marginal utility and price
D) he can equate his demand with price
  • 15. Foreign investment and long term securities in the balance of payment accounts are recorded as
A) current account transaction
B) capital account transaction
C) balance of trade account transaction
D) invisible balance account transaction
  • 16. A benefit that is present in all forms of economic integration is that
A) the size of the market is widened
B) common agricultural policy is in place
C) factors of production are free to move and be moved
D) common currency is in use
  • 17. Points within a Production Possibilities Curve (PPC) indicate
A) attainable but inefficient production levels.
B) unattainable production levels.
C) optimum production levels.
D) attainable and efficient production levels.
  • 18. Which of the following is not a feature of labour?
A) it’s efficiency depends on its size
B) it’s reward is wages and salaries
C) it is highly mobile
D) it is an active factor
  • 19. The pursuit of private profits is a feature of
A) socialist economies
B) command economies
C) capitalist economies
D) statutory corporations
  • 20. A major feature of the socialist economic system is
A) determination of price by market forces.
B) setting of production targets by public authorities.
C) private ownership of productive inputs.
D) freedom of choice for consumers.
  • 21. If the budget on education is $50 m out of an annual national budget of $300 m. The sector of a pie chart representing education is
A) 150°
B) 300°
C) 60°
D) 16.6°
  • 22. Price elasticity of demand is the responsiveness of quantity demanded to a change in
A) price of another product
B) demand for the product
C) income of the buyer
D) price of the product
  • 23. When total revenue increases as price falls, the coefficient of price elasticity of demand is
A) less than one
B) greater than one
C) one
D) zero
  • 24. If the quantity demanded of rice de- creased from 150 bags to 100 bags, the percentage change in quantity demanded is
A) 80%
B) 33.3%
C) 65%
D) 30%
  • 25. The law of demand will not hold when
A) income and consumers increase
B) normal goods are involved
C) rare commodities are involved
D) size of the population changes
  • 26. The diagram above shows the demand for milk. Use it to answer questions this question.



    The movement from point x to z might have been caused by
A) a decrease in the price of milk
B) an increase in income of consumers
C) a favorable weather condition
D) a change in taste in favour of milk
  • 27. The diagram above shows the demand for milk. Use it to answer this question.

    If demand for postal services decline as a result of increased use of e-mails, then the two services are in
A) complementary demand
B) competitive demand
C) composite demand
D) derived demand
  • 28. Other things being equal, an increase in the demand for land in the short-run will cause an increase in the
A) supply only
B) quantity supplied only
C) price only
D) price and supply
  • 29. If the coefficient of price elasticity of supply of a commodity is 0.8, then supply is
A) perfectly elastic
B) fairly inelastic
C) perfectly inelastic
D) fairly elastic
  • 30. The negative slope of the demand curve is best explained by
A) consumer’s choice
B) increasing return to scale
C) diminishing marginal utility
D) diminishing returns to scale
  • 31. Minimum price legislation is used to protect the interests of
A) small scale producers
B) foreign companies
C) consumers
D) government
  • 32. Which of the following best explains diseconomies of scale? Increase in output causes the
A) average cost to rise
B) marginal cost to fall
C) firm to be de-stabilized
D) marginal revenue to fall
  • 33. In the short-run, a firm can increase output by
A) changing its organizational structure
B) purchasing more equipments
C) increasing the quantity of raw materials
D) increasing the size of its machines
  • 34. The fixed cost of producing 100 units of a good is $600. If the variable cost is $400. the average total cost of one unit of the good is
A) $10
B) $8
C) $15
D) $4
  • 35. Firms in perfect competition break even in the long-run because
A) more firms can enter the industry due to attractive prof its.
B) marginal revenue is greater than marginal cost at all levels.
C) profits are not enough to repay traders' loans.
D) new firms can not enter the market due to copyright laws.
  • 36. The government policy that encourages public corporations to operate profitably is
A) nationalization
B) liberalization
C) indigenization
D) commercialization
  • 37. Warehousing of goods in the process of distribution is the function of
A) retailers
B) supermarkets
C) wholesalers
D) departmental stores
  • 38. The supply of labour to an occupation will tend to rise when
A) unemployment benefit rises
B) welfare packages improve
C) holiday entitlement is cut
D) there are less monetary benefits
  • 39. In determining the growth of a country's population, infant mortality is a component of
A) fertility rate
B) net migration
C) immigration rate
D) death rate
  • 40. The low productivity per worker in agriculture experienced in West African countries is due to
A) the law of increasing returns to scale
B) the use of simple traditional implements
C) the presence of many extension workers
D) laziness on the part of farmers
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