FUTA Economics 2020/2021 Model 1 Past Questions

Practice each question, then open it to see the full details.

Which of these statements describes a mixed economy?

A.The government and the private sector interact in solving the basic economic problems
B.The invisible hand solves the basic economic problems
C.The government produces and distributes
D.Society answers the question "what", "why" and for "whom" questionis only through the market system

Which of the financial institutions is charged with the formulation of monetary policies in Nigeria?

A.The Lagos state stock exchange
B.The Nigeria deposit insurance
C.The Central Bank of Nigeria
D.The Abuja commodity exchange

The primary function of non-financial institutions is to

A.Manage investment portfolio for government
B.Mobilize saving for investment
C.Grant loans to banks
D.Receive deposits from banks.

The difference between payments and receipts for visible trade is called

A.bilateral trade
B.current balance
C.balance of payment
D.balance of trade

Which of these is the real cost of satisfying any want in the sense that has to be foregone?

A.Variable cost
B.Opportunity cost
C.Total cost
D.Prime cost.

The total money in circulation includes cash

A.owned by banks, the government, the non-bank public
B.and current account balance owners by the non- bank public
C.and current account balance owners by banks and the non-bank public
D.owned by banks and non-bank public

The ultimate objective of economics is to

A.Make the best use of scarce resources
B.Decide under what circumstances in the economy
C.Organize production at the lowest cost
D.Make effort to understand how the economy works

The organization which provide credits to help countries achieve short term balance in their balance of payment is the

A.Economic Community of West African State
B.International Monetary Fund
C.International Bank for Reconstruction and Development
D.African Development Bank

If the cost of production for a firm continues to increase as its output rises, the firm is said to be experiencing

A.Large scale production
B.profit maximization
C.Economies of scale
D.Diseconomies of scale

The shape of a production probability frontier is determined by the

A.returns to scale
B.increasing relative cost
C.increasing returns to a variable factor
D.diminishing return to a fixed factor

Efficiency of labor is enhanced by

A.involvement in own family affairs
B.War against indiscipline
C.Mechanization processes
D.Improved working condition and training.

The law of comparative advantage states that a country should specialize in the production of a commodity

A.For which local demand is greatest
B.in which its opportunity cost is lower than that of the trade partner
C.for which foreign demand is greatest
D.for which there is abundant supply of raw materials

Given an original price of #400 per kilogram of rice and a change in price of #20, and given the quantity purchased at the old price as 10kg and a change in quantity as 5kg after the price changed the elesticity is equal to

A.5
B.10.8
C.10
D.0.80

A public liability company is different from private limited company because it

A.is registered with the registrar of companies
B.is a legal entity
C.can raise capital of any size by loans
D.can sell shares in the stock exchange

Deficit financing is mostly facilitated by the existence of

A.stock exchange market
B.commercial bank
C.central bank
D.capital market