JAMB and WAEC Economics questions: Theory of costs and revenue

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

1. Question 21· 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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   Explanation and discussion

2. Question 22· Theory of costs and revenue· WAEC

   A firm's fixed cost is ₦5,000 and variable cost for 100 units is ₦15,000. The average total cost is

   • A₦200
   • B₦150
   • C₦50
   • D₦20,000

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   Explanation and discussion

3. Question 23· 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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   Explanation and discussion

4. Question 24· Theory of costs and revenue· WAEC

   The rent a bakery pays for its shop, whatever the number of loaves baked, is a

   • Amarginal cost
   • Bvariable cost
   • Cfixed cost
   • Dopportunity cost

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   Explanation and discussion

5. Question 25· Theory of costs and revenue· WAEC

   Total revenue is calculated as

   • Aprice ÷ quantity
   • Bcost × quantity
   • Cprofit ÷ cost
   • Dprice × quantity sold

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   Explanation and discussion

6. Question 26· Theory of costs and revenue· WAEC

   A firm's total revenue is ₦1,200 when it sells 40 units. Its average revenue is

   • A₦20
   • B₦40
   • C₦30
   • D₦48

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   Explanation and discussion

7. Question 27· Theory of costs and revenue· WAEC

   In the short run a firm will continue production as long as price covers

   • Amarginal revenue
   • Baverage total cost
   • Cfixed cost only
   • Daverage variable cost

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   Explanation and discussion

8. Question 28· 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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   Explanation and discussion

9. Question 29· 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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   Explanation and discussion

10. Question 30· 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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    Explanation and discussion

11. Question 31· 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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    Explanation and discussion

12. Question 32· 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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    Explanation and discussion

13. Question 33· Theory of costs and revenue· WAEC

    A firm sells 50 units at ₦40 each. Its total revenue is

    • A₦2,000
    • B₦90
    • C₦1,250
    • D₦200

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    Explanation and discussion