OAU Economics 2012/2013 Past Questions

Question 4

An economic system can be defined as an

A.Arrangement specifying how production and consumption are controlled in a society
B.Arrangement whereby goods are distributed in a society
C.Arrangement where human wants are satisfied in a society
D.Arrangement specifying how productive resources are distributed in a society

Objective

Question 5

The following are features of a free market economy except

A.Private ownership of properties
B.Existence of competition
C.High level of profit maximization by private investors
D.Joint decision making by the citizens in a society

Objective

Question 6

In a capitalist society, production and consumption are regulated by the:

A.demand for the commodity
B.the government
C.price system
D.Private individuals

Objective

Question 7

The following are advantages of socialism except

A.Equitable distribution of resources
B.Absence of exploitation
C.Equitable distribution of income
D.promotion of high standard of living

Objective

Question 8

Marginal Product (MP) is best defined as

A.Total product/No of labour
B.Change in total product/Change in variable factor
C.Total product/fixed factor
D.Average product/No of labour

Objective

Question 9

Which of the following is NOT a limitation to division of labour and specialization

A.The size of the market
B.Availability of capital
C.Interdependence among the workers
D.The nature of the product

Objective

Question 10

The following are the advantages of internal economies of large scale production except

A.Financial economics
B.Administrative economics
C.technical economies
D.Market preference

Objective

Question 11

The basic concepts of Economics are

A.Choice, scarcity, resources and efficiency
B.Wants, scarcity, choice, scale of preference and opportunity cost
C.Wants, scarcity and choice
D.Wants, choice, scale of preference and opportunity cost

Objective

Question 12

In Economics, human wants are usually described as

A.many
B.Insatiable
C.Limited
D.Numerous

Objective

Question 13

Basic economic problems of society include the following except

A.What to produce
B.How to produce
C.Where to produce
D.For whom to produce

Objective

Question 14

The value of money is measured in terms of price index as follows price in the current year

A.Prince index = Price in the current year/Price in the previous year X 100%
B.Price index = Price in the previous year/Price in the current year X 100%
C.Prince index = Price in the current year/Velocity of circulation of money X 100%
D.Prince index = price in the base year/price in the current year X 100%

Objective

Question 15

Marginal propensity to consumer (MPC) is calculated using one of the following formulae

A.MPC = change saving / Change in income
B.MPC = Change in consumption / Change in income
C.MPC = 1/1-MPC = 1/MPS
D.MPC = Total savings / Total income

Objective

Question 16

Which of the following is TRUE of Marginal cost?

A.it is a cost incurred by the firm on variable input
B.It is the cost of producing one extra unit of a commodity at any output level
C.It is the sum of the fixed cost and variable cost
D.It is referred to as overhead cost

Objective

Question 17

Which of the following items is NOT a variable cost?

A.Cost of machine
B.Cost of electricity
C.Salaries and wages
D.Cost of raw materials

Objective

Question 18

Which of the following is NOT true of a market demand schedule?

A.It is a schedule of all consumers of a commodity in a market
B.It is the aggregate demand schedule of all consumers of a commodity in a market
C.It is a table showing the different quantities of a commodity which a consumer would purchase at various prices.
D.it is a table showing the composite demand schedule of all consumers of a commodity in a market

Objective

Question 19

Cross elasticity of demand can be measured using one of the following formulae.

A.% change in quantity demanded / % change in consumers income
B.% change in quantity demanded / % change in price
C.% change in price of commodity Y / % change in quantity demanded of commodity X
D.% change in quantity demanded of commodity / % change in price of commodity Y

Objective

Question 20

Use the table to answer questions 20 — 22