JAMB Economics questions

378 questions with answers and explanations. Tap an option to check yourself.

1. Question 301· Theory of costs and revenue· JAMB

   The long-run average cost curve is typically

   • Avertical
   • Bstraight horizontal
   • CU-shaped
   • Dupward sloping only

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   Answer: C. U-shaped

   Explanation and discussion

2. Question 302· Theory of costs and revenue· JAMB

   A firm's total cost of producing 50 units is ₦500. Find the average cost.

   • A₦25,000
   • B₦10
   • C₦50
   • D₦450

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   Answer: B. ₦10

   Explanation and discussion

3. Question 303· Theory of costs and revenue· JAMB

   Average fixed cost falls continuously as output rises because

   • Athe same fixed cost is spread over more units
   • Bfixed cost rises
   • Cvariable cost falls
   • Dprice falls

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   Answer: A. the same fixed cost is spread over more units

   Explanation and discussion

4. Question 304· Theory of costs and revenue· JAMB

   Total fixed cost is ₦6,000 and output is 300 units. Average fixed cost is

   • A₦200
   • B₦6,000
   • C₦1,800,000
   • D₦20

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   Answer: D. ₦20

   Explanation and discussion

5. Question 305· Theory of costs and revenue· JAMB

   A firm sells 40 units at ₦25 each. Find its total revenue.

   • A₦625
   • B₦65
   • C₦1,000
   • D₦1.60

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   Answer: C. ₦1,000

   Explanation and discussion

6. Question 306· Theory of costs and revenue· JAMB

   A firm's fixed costs are ₦50,000, its price ₦500 a unit and its variable cost ₦300 a unit. Its break-even output is

   • A100 units
   • B250 units
   • C167 units
   • D500 units

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   Answer: B. 250 units

   Explanation and discussion

7. Question 307· Theory of costs and revenue· JAMB

   Total cost rises from ₦200 to ₦260 when output rises from 10 to 12 units. Find the marginal cost per unit.

   • A₦60
   • B₦30
   • C₦21.67
   • D₦13

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   Answer: B. ₦30

   Explanation and discussion

8. Question 308· Theory of costs and revenue· JAMB

   Total cost is ₦30,000 at 100 units and ₦33,000 at 110 units. Marginal cost per unit is

   • A₦300
   • B₦3,000
   • C₦330
   • D₦30

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   Answer: A. ₦300

   Explanation and discussion

9. Question 309· Theory of costs and revenue· JAMB

   In the short run, a firm will shut down if the price falls below its

   • Aaverage fixed cost
   • Baverage variable cost
   • Cmarginal revenue
   • Daverage total cost only

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   Answer: B. average variable cost

   Explanation and discussion

10. Question 310· Theory of demand· JAMB

    Which of the following shifts the demand curve for a normal good to the right?

    • Aa rise in the price of the good
    • Ba fall in the price of the good
    • Can increase in consumers' income
    • Dan increase in the cost of production

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    Answer: C. an increase in consumers' income

    Explanation and discussion

11. Question 311· Theory of demand· JAMB

    If the cross elasticity of demand between two goods is positive, the goods are

    • Asubstitutes
    • Bcomplements
    • Cunrelated
    • Dinferior

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    Answer: A. substitutes

    Explanation and discussion

12. Question 312· Theory of demand· JAMB

    The demand for necessities such as salt is usually

    • Aunitary elastic
    • Bperfectly elastic
    • Cprice elastic
    • Dprice inelastic

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    Answer: D. price inelastic

    Explanation and discussion

13. Question 313· Theory of demand· JAMB

    If income elasticity of demand is negative, the good is

    • Anormal
    • Binferior
    • Cluxury
    • Dnecessity with positive elasticity

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    Answer: B. inferior

    Explanation and discussion

14. Question 314· Theory of demand· JAMB

    A Giffen good is one whose quantity demanded

    • Afalls as income rises
    • Brises as its price rises
    • Cnever changes
    • Drises only when income rises

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    Answer: B. rises as its price rises

    Explanation and discussion

15. Question 315· Theory of demand· JAMB

    Cross elasticity of demand between substitutes is

    • Ainfinite always
    • Bnegative
    • Czero
    • Dpositive

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    Answer: D. positive

    Explanation and discussion

16. Question 316· Theory of demand· JAMB

    Ostentatious goods bought to show off wealth are called

    • AVeblen goods
    • BGiffen goods
    • Cinferior goods
    • Dfree goods

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    Answer: A. Veblen goods

    Explanation and discussion

17. Question 317· Theory of demand· JAMB

    The price of a good rises from ₦10 to ₦12 and quantity demanded falls from 100 to 80 units. The price elasticity of demand is

    • A1 (unitary)
    • B0.5
    • C2
    • D0

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    Answer: A. 1 (unitary)

    Explanation and discussion

18. Question 318· Theory of demand· JAMB

    Cars and petrol are an example of goods in

    • Acompetitive demand
    • Bjoint (complementary) demand
    • Cderived demand
    • Dcomposite demand

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    Answer: B. joint (complementary) demand

    Explanation and discussion

19. Question 319· Theory of demand· JAMB

    The law of demand states that, other things being equal,

    • Ademand does not change with price
    • Bthe higher the price, the higher the quantity demanded
    • Cthe higher the price, the lower the quantity demanded
    • Dsupply creates its own demand

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    Answer: C. the higher the price, the lower the quantity demanded

    Explanation and discussion

20. Question 320· Theory of demand· JAMB

    Price falls from ₦50 to ₦40 and total revenue rises. Demand is

    • Aunitary
    • Binelastic
    • Celastic
    • Dperfectly inelastic

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    Answer: C. elastic

    Explanation and discussion