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SS3 Mock Examinations
Contributed by: Ajiboye
  • 1. What is the fundamental economic problem?
A) Unemployment
B) Inflation
C) Scarcity
D) Poverty
  • 2. Which economic system is characterized by private ownership?
A) Command
B) Capitalist
C) Socialist
D) Mixed
  • 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 reduce unemployment
C) To control inflation
D) To promote economic growth
  • 5. A Minimum price legislation is also called
A) Price floor
B) Price control
C) Price mechanism
D) Price Ceiling
  • 6. Which of the following factors is not a cause of change in demand? Changes in
A) the size of the population
B) taste and fashion
C) income distribution
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) 2.50
B) 2.00
C) 0.65
D) 0.50
  • 8. The use of the bank rate, cash ratio and open market operations constitute
A) fiscal policy
B) monetary policy
C) import policy
D) export policy
  • 9. Scale of Preference shows
A) opportunity cost of goods consumed
B) utilities enjoyed by consumers
C) consumer’s wants in order of priority
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 upward
B) Is Horizontal
C) Slopes downward
D) Is Vertical
  • 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) money transferred to another country
D) unemployment allowance paid to the citizens
  • 13. Which of the following industries will add more value to primary products?
A) Construction industry
B) Mining industry
C) Processing industry
D) Service industry
  • 14. A consumer of a single commodity is in equilibrium when
A) he equates marginal utility and price
B) his marginal utility is equal to zero
C) he can equate his marginal and total utilities
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) invisible balance account transaction
B) capital account transaction
C) current account transaction
D) balance of trade account transaction
  • 16. A benefit that is present in all forms of economic integration is that
A) common currency is in use
B) the size of the market is widened
C) common agricultural policy is in place
D) factors of production are free to move and be moved
  • 17. Points within a Production Possibilities Curve (PPC) indicate
A) optimum production levels.
B) unattainable production levels.
C) attainable but inefficient 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 is highly mobile
C) it’s reward is wages and salaries
D) it is an active factor
  • 19. The pursuit of private profits is a feature of
A) socialist economies
B) statutory corporations
C) command economies
D) capitalist economies
  • 20. A major feature of the socialist economic system is
A) determination of price by market forces.
B) freedom of choice for consumers.
C) private ownership of productive inputs.
D) setting of production targets by public authorities.
  • 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) 60°
C) 16.6°
D) 300°
  • 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) one
B) less than one
C) greater than 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) 65%
B) 80%
C) 33.3%
D) 30%
  • 25. The law of demand will not hold when
A) normal goods are involved
B) rare commodities are involved
C) income and consumers increase
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 favorable weather condition
B) an increase in income of consumers
C) a change in taste in favour of milk
D) a decrease in the price 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) composite demand
C) competitive 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) price and supply
B) price only
C) quantity supplied only
D) supply only
  • 29. If the coefficient of price elasticity of supply of a commodity is 0.8, then supply is
A) perfectly inelastic
B) fairly elastic
C) perfectly elastic
D) fairly inelastic
  • 30. The negative slope of the demand curve is best explained by
A) diminishing returns to scale
B) consumer’s choice
C) increasing return to scale
D) diminishing marginal utility
  • 31. Minimum price legislation is used to protect the interests of
A) foreign companies
B) consumers
C) government
D) small scale producers
  • 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) increasing the quantity of raw materials
B) changing its organizational structure
C) purchasing more equipments
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) $4
D) $15
  • 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) new firms can not enter the market due to copyright laws.
C) profits are not enough to repay traders' loans.
D) marginal revenue is greater than marginal cost at all levels.
  • 36. The government policy that encourages public corporations to operate profitably is
A) liberalization
B) commercialization
C) indigenization
D) nationalization
  • 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) welfare packages improve
B) there are less monetary benefits
C) unemployment benefit rises
D) holiday entitlement is cut
  • 39. In determining the growth of a country's population, infant mortality is a component of
A) fertility rate
B) death rate
C) immigration rate
D) net migration
  • 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) laziness on the part of farmers
D) the presence of many extension workers
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