WAEC Economics 2014 Past Questions

Human want are unlimited because

A.production is inadequate
B.resources have alternative uses
C.new wants always rise
D.resources are limited

The table below shows an extract from balance of payments for country A. Use the table to answer the questions that follow:
Balance of payments items

	Items of transaction	Receipts ($)	Payment ($)
1	Merchandise (visible trade)	52,000.00	4,000.00
2	Shipping, other transport and travel	4,000.00	8,000.00
3	Investment income	20,000.00	5,000.00
4	Other services	2,500.00	7,500.00
5	Unrequired transfers	22,800.00	7,000.00
6	Direct investment	50,000.00	26,000.00
7	Other long-term capital	254,000.00	289,000.00
8	Short-term capital	221,000.00	238,000.00

Calculate the:

(a) balance of trade (3 marks)

(b) balance on current account (8 marks)

(c) balance on capital account (6 marks)

(d) balance of payment (3 marks)

Theory

Question 2

A basic economic problem of any society is

A.high level of illiteracy
B.irregular power supply
C.population growth
D.resource allocation

Objective

Question 2

The table below presents the price and quantity supplied by a palm oil producer. Use the information in the table to answer the following questions.

Price ($)	Quantity Supplied (gallons)
6	200
12	300
18	400
20	500
24	600

(a) If the price of palm oil falls from $20.00 to $18.00, calculate the price elasticity of supply. (4 arks)

(b) Interpret your answer in question 2(a) above. (2 marks)

(c) Study the extract below and answer the following questions. The price of palm oil remains at $6.00 per gallon and an increase in the price of a related product causes an increase in the supply of palm oil:
(i) Give a graphical presentation to illustrate this change. (6 marks)
(ii) Indicate the type of supply for the two products. (2 marks)

(d) State reasons that can cause a change in supply. (6 marks)

Theory

Question 3

In a centrally planned economy, what to produce is

A.determined by the forces of demand and spply
B.driven by profit motive
C.determined by consumers
D.the responsibility of state's bureaucrats

Objective

Question 3

(a) Define occupational mobility of labour. (2 marks)

(b) Identify any four barriers to occupational mobility of labour. (12 marks)

(c) State any two factors that will make labour efficient. (6 marks)

Theory

Question 4

Which of following is not a feature of socialism?

A.Collective ownership of productive resources
B.Freedom of enterprise
C.production is not based on the profit motive
D.Maximization of public welfare

Objective

Question 4

(a) What is crop farming? (2 marks)

(b) Outline any four measures that can be adopted to increase crop production in your country. (12 marks)

(c) State any two contributions of the industrial sector to agriculture in your country. (6 marks)

Theory

Question 5

Households make economic decisions because they want to

A.make more profit
B.increase their salaries and wages
C.increase their purchases
D.maximize their satisfaction

Objective

Question 5

(a) Highlight any four differences between public limited liability company and a private limited liability company. (8 marks)

(b) Explain any four advantages a limited liability company. (2 marks)

Theory

Question 6

A normal supply curve has a positive slope which indicates that

A.sellers are willing to sell more at a lower price
B.sellers are indifferent to prices
C.sellers are willing to sell more at a higher price
D.there is always a fixed supply

Objective

Question 6

(a) Define gross national income. (2 marks)

(b) Using appropriate examples, distinguish between:
(i) Personal income and disposable income. (6 marks)
(ii) Nominal income and real income. (6 marks)

(c) Outline any three uses of national income statistics. (6 marks)

Theory

Question 7

To control inflation, the central bank of a country may adopt

A.an expansionary monetary policy
B.a restrictive monetary policy
C.an increased wage policy
D.a deficit financing policy

Objective

Question 7

(a) What is the normal chain of distribution? (2 marks)

(b) State any three functions of middlemen in the chain of distribution. (6 marks)

(c) Highlight any four problem involved in the distribution of goods in West Africa. (12 marks)

Theory

Question 8

Disposable income is the income earned

A.by the nationals of a country resident within the country
B.from prouctive activities of nationals of a country both at home and abroad
C.when personal income tax is deducted from personal income
D.when the gross income of an individual is added to person income tax

Objective

Question 8

(a) What is a specific tax? (2 marks)

(b) Explain with the aid of diagrams, the effects of specific tax on a commodity that has a:
(i) perfectly elastic demand; (6 marks)
(ii) perfectly inelastic demand

(c) State two differences between a direct tax and and an indirect tax. (6 marks)

Theory

Question 9

Livestock production in West Africa is hindered mainly by

A.inadequate demand
B.use of traditional implements
C.land tenure system
D.pests and diseases

Objective

Question 10

The components of a three-sector economy are

A.banks, schools and hospitals
B.workers, producers and marketers
C.households, firms and the government
D.producers, retailers and wholesalers

Objective

Question 11

A declining population is one in which the population is

A.experiencing a high rate of emigration
B.made up of large number of old people
C.not producing enough goods
D.not contributing enough to the national income

Objective

Question 12

Which of the following agencies help to stabilize farmers' income?

A.Local government authorities
B.Trade unions
C.Marketing boards
D.Co-operative organizations

Objective

Question 13

Other things being equal, an increase in supply will lead to

A.a fall in price and an increase in quantity bought and sold
B.an increase in price and increase in quantity bought and sold
C.a fall in price and a fall in quantity bought and sold
D.an increase in quantity supplied and demanded only

Objective

Question 14

Examples of joint stock banks are

A.commercial banks
B.co-operative credit societies
C.central banks
D.development banks

Objective

Question 15

Which of the following is not a characteristic of a developing country? High

A.real per capita income
B.level of primary production
C.population growth rate
D.level of illiteracy

Objective

Question 16

Goods consumed out of habit have

A.elastic demand
B.perfectly elastic demand
C.inelastic demand
D.unitary elastic demand

Objective

Question 17

If the coefficient of price elasticity of demand is 0.1, demand is

A.elastic
B.inelastic
C.zero elastic
D.unitary elastic

Objective

Question 18

The profit of a producer is the difference between

A.total cost and marginal cost
B.total revenue and total cost
C.average cost and total cost
D.price and total cost

Objective

Question 19

The rate of increase in utility is

A.average utility
B.increasing utility
C.total utility
D.marginal utility

Objective

Question 20

The supply of tea is linearly presented as p = 0 . 2Q, where P is the price and Q is the quantity. What is P when Q = 25?

A.$ 0.08
B.$ 5.00
C.$ 25.02
D.$ 125

Objective

Question 21

Increase in supply due to changes in plant size will take place only in the

A.normal time
B.long run
C.market period
D.short run

Objective

Question 22

The long - run average cost curve is made up of several short-run

A.marginal and average cost curves
B.average cost curves
C.average variable cost curves
D.average variable and total cost curves

Objective

Question 23

Co-operative societies formed to market the output of their members are called

A.Consumers' co-operative societies
B.marketing co-operative societies
C.Credit and thrift co-operative societies
D.Producers' co-operative societies

Objective

Question 24

Money will serve as a standard of deferred payment if it is

A.homogeneous
B.durable
C.easily recognized
D.stable in value

Objective

Question 25

Due to an increase in price, a seller increases the quantity offered for sale from 400 units. What is the percentage change in quantity supplied?

A.1 %
B.7.5%
C.12.5%
D.20%

Objective

Question 26

Which of the following will increase the nominal value of national income?

A.High rate of inflation
B.increase in the value of money
C.Increase in import
D.High rate of subsistence production

Objective

Question 27

Cyclical unemployment is one associated with

A.inadequate information
B.trade fluctuations
C.structural changes
D.seasonal changes

Objective

Question 28

Which of the following best defines inflation?

A.Cyclical increase in prices
B.Periodic increase in prices
C.Persistent increase in prices
D.Occasional increase in prices

Objective

Question 29

Perfect knowledge of events in a perfect market will be made possible by the existence of

A.many buyers and sellers
B.homogeneous products
C.means of communication
D.large number of traders

Objective

Question 30

An increase in the price of a commodity from $10 to $ 15 leads to an increase in the quantity supplied from 10 units to 15 units. The price elasticity of supply is

A.0.
B.0.5.
C.1.
D.5.

Objective

Question 31

Economic development may be hindered if there is

A.a high pool of skilled labour
B.a high rate of economic growth
C.political stability
D.rapid population growth

Objective

Question 32

Which of the following types of unemployment results from changes in the pattern of aggregate demand ?

A.Technological unemploment
B.Stuctural unemployment
C.Frictional unemployment
D.Seasonal unemployment

Objective

Question 33

Which of the following is not a reason countries import goods?

A.Differences in natural endowments
B.the law of absolute advantage
C.Differences in tastes
D.The love for other nations

Objective

Question 34

Provision of short-term loans to solve balance of payments problems is done by the

A.International Finance Corporation
B.International Monetary Fund
C.Iternational Bank for Reconstruction and Development
D.African Development Bank

Objective

Question 35

West African countries are experiencing worsening terms of trade because

A.they are primary producers
B.their currencies are overvalued
C.they import less machines
D.they are tertiary producers

Objective

Question 36

Which of the following statements is correct?

A.As total utility increases, the marginal utility also increases
B.The marginal utility is a always zero whenever the total utility reaches the maximum
C.The total utility is at maximum whenever marginal utility is at it's maximum
D.There is no relationship between total utility and the marginal utility

Objective

Question 37

A change in the quantity demanded of a given commodity is determined by the

A.size of the population
B.income of the consumer
C.price of the commodity
D.taste and fashion

Objective

Question 38

The likely implication of the devaluation of a country's currency is that

A.exports of such a country become cheaper
B.importation of goods into such a country becomes cheaper
C.the value of such a country's currency rises
D.foreign goods are attracted into the country

Objective

Question 39

International trade is desirable because it

A.may lead to overproduction
B.brings about over-dependence of countries on one another
C.provides foreign market for local goods
D.brings about unhealthy competition and rivalries

Objective

Question 40

A financial institution established for the purpose of providing specialzed services like acceptance of bills of exchange and equipment leasing is known as

A.Merchant Bank
B.Development Bank
C.Central Bank
D.Insurance Company

Objective

Question 41

Which of the following functions of money is mostly affected during inflation?

A.Medium of exchange
B.Unit of Account
C.Store of value
D.Standard of deferred payment

Objective

Question 42

Precautionary motive for holding money is to

A.meet daily and regular transactions
B.take advantage of changes in the prices of goods and services
C.cover unforeseen events
D.cover expenses on house rent

Objective