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SS3 Mock Examinations
Contributed by: Ajiboye
  • 1. What is the fundamental economic problem?
A) Scarcity
B) Inflation
C) Unemployment
D) Poverty
  • 2. Which economic system is characterized by private ownership?
A) Mixed
B) Capitalist
C) Command
D) Socialist
  • 3. What type of market structure has many buyers and sellers?
A) Oligopoly
B) Perfect Competition
C) Monopsony
D) Monopoly
  • 4. What is the purpose of fiscal policy?
A) To promote economic growth
B) All of the above
C) To control inflation
D) To reduce unemployment
  • 5. A Minimum price legislation is also called
A) Price control
B) Price Ceiling
C) Price mechanism
D) Price floor
  • 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) taste and fashion
D) price of the commodity
  • 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) 0.50
B) 2.00
C) 2.50
D) 0.65
  • 8. The use of the bank rate, cash ratio and open market operations constitute
A) import policy
B) monetary policy
C) export policy
D) fiscal policy
  • 9. Scale of Preference shows
A) consumer’s wants in order of priority
B) Incomes of consumer in order of size
C) utilities enjoyed by consumers
D) opportunity cost of goods consumed
  • 10. Gross National Product (GNP) less the provision for the wear and tear of assets is the
A) net factor income
B) net present value
C) net indirect taxes
D) net national product
  • 11. In perfectly elastic supply, the supply curve
A) Slopes upward
B) Is Horizontal
C) Is Vertical
D) Slopes downward
  • 12. An example of transfer payments in national income accounting is
A) the amount paid to a worker on transfer
B) transfer of funds from one bank to another
C) unemployment allowance paid to the citizens
D) money transferred to another country
  • 13. Which of the following industries will add more value to primary products?
A) Mining industry
B) Service industry
C) Processing industry
D) Construction industry
  • 14. A consumer of a single commodity is in equilibrium when
A) he can equate his marginal and total utilities
B) he can equate his demand with price
C) he equates marginal utility and price
D) his marginal utility is equal to zero
  • 15. Foreign investment and long term securities in the balance of payment accounts are recorded as
A) current account transaction
B) invisible balance account transaction
C) capital account transaction
D) balance of trade account transaction
  • 16. A benefit that is present in all forms of economic integration is that
A) common agricultural policy is in place
B) the size of the market is widened
C) common currency is in use
D) factors of production are free to move and be moved
  • 17. Points within a Production Possibilities Curve (PPC) indicate
A) attainable and efficient production levels.
B) attainable but inefficient production levels.
C) unattainable production levels.
D) optimum production levels.
  • 18. Which of the following is not a feature of labour?
A) it’s reward is wages and salaries
B) it’s efficiency depends on its size
C) it is an active factor
D) it is highly mobile
  • 19. The pursuit of private profits is a feature of
A) capitalist economies
B) socialist economies
C) statutory corporations
D) command economies
  • 20. A major feature of the socialist economic system is
A) private ownership of productive inputs.
B) setting of production targets by public authorities.
C) determination of price by market forces.
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) 300°
B) 150°
C) 60°
D) 16.6°
  • 22. Price elasticity of demand is the responsiveness of quantity demanded to a change in
A) demand for the product
B) income of the buyer
C) price of another product
D) price of the product
  • 23. When total revenue increases as price falls, the coefficient of price elasticity of demand is
A) one
B) less than one
C) zero
D) greater than one
  • 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) 30%
C) 33.3%
D) 65%
  • 25. The law of demand will not hold when
A) normal goods are involved
B) size of the population changes
C) income and consumers increase
D) rare commodities are involved
  • 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) an increase in income of consumers
B) a decrease in the price of milk
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) derived demand
C) competitive demand
D) composite demand
  • 28. Other things being equal, an increase in the demand for land in the short-run will cause an increase in the
A) price and supply
B) supply only
C) price only
D) quantity supplied only
  • 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) diminishing marginal utility
B) diminishing returns to scale
C) increasing return to scale
D) consumer’s choice
  • 31. Minimum price legislation is used to protect the interests of
A) government
B) small scale producers
C) foreign companies
D) consumers
  • 32. Which of the following best explains diseconomies of scale? Increase in output causes the
A) marginal cost to fall
B) firm to be de-stabilized
C) average cost to rise
D) marginal revenue to fall
  • 33. In the short-run, a firm can increase output by
A) purchasing more equipments
B) increasing the size of its machines
C) increasing the quantity of raw materials
D) changing its organizational structure
  • 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) $4
B) $15
C) $10
D) $8
  • 35. Firms in perfect competition break even in the long-run because
A) marginal revenue is greater than marginal cost at all levels.
B) more firms can enter the industry due to attractive prof its.
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) commercialization
C) indigenization
D) liberalization
  • 37. Warehousing of goods in the process of distribution is the function of
A) departmental stores
B) wholesalers
C) retailers
D) supermarkets
  • 38. The supply of labour to an occupation will tend to rise when
A) holiday entitlement is cut
B) welfare packages improve
C) unemployment benefit rises
D) there are less monetary benefits
  • 39. In determining the growth of a country's population, infant mortality is a component of
A) death rate
B) net migration
C) fertility rate
D) immigration rate
  • 40. The low productivity per worker in agriculture experienced in West African countries is due to
A) the use of simple traditional implements
B) laziness on the part of farmers
C) the presence of many extension workers
D) the law of increasing returns to scale
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