NDA PAST QUESTIONS ON ECONOMICS 2014
1. The study of Economics becomes necessary because of
A. utility derived from a commodity
B. needs to draw up a scale of preference
C. opportunity cost of goods and services
D. scarcity of resources
2. Moses bought a pair of shoes instead of a face cap. His real cost therefore is
A. the shoes
B. the face cap
C. the price of face cap
D. the price of shoes
A. choice
B. the demand for them
C. limited wants
D. their scale of preference
4. Which of these is a measure of central tendency?
A. mode
B. variance
C. standard deviation
D mean deviation
5. Production cost such as rent, depreciation and interest are referred to as
A. total cost
B. average cost
C. marginal cost
D. fixed cost
6. The satisfaction derived by an individual from consuming one additional unit of a commodity is known as
A. marginal utility
B. marginal output
C. diminishing utility
D. increasing utility
7. If a factory worker performs only one small operation many times during each working day, it may lead to
A. division of labour
B. monotony of the work
C. increase in production
D. loss of working hours
8. A nation with a working population that is sufficient to exploit its resources is said to be having
A. optimum population
B. underpopulation
C. overpopulation
D. occupational population
9. If the fixed cost is ₦600.00, variable cost is ₦400.00 and total output is 100. What is the average cost?
A. ₦10.00
B. ₦I1.00
C. ₦20.00
D. ₦12.00
10. In a centrally planned economy, the economic problem of deciding what to produce is dependent on
A. private enterprise
B. state command
C. relative prices
D. input cost
11.
11.
The firm whose sales and total revenue of the goods sold as given above is
A. a monopolist
B. a monopolistic competition
C. a perfect competition
12. At a point where marginal revenue of a monopolist is equal to zero, its total revenue will be
A. falling
B. rising
C. equal to zero
D. maximum
13. A distinguishing characteristic of cooperative societies is that voting power depends on the
13. A distinguishing characteristic of cooperative societies is that voting power depends on the
A. number of shares held
B. status of the members
C. equality of members
D. management's decisions
14. The concept of privatization presupposes
A. efficiency
B. market price
C. indigenization
D. foreign trade
15. A capital market differs from the money market in that the former
A. loan sought is short term
B. loan repayment is guaranteed
C. loan sought is long term
D. the percentage of interest charged is more
16. An aspect of taxation that involves normative economics is the
A. tax rate
B. effect on incentives to work
C. fairness of the tax
D. tax burden
17. Public debt is composed of
A. internal debts and World Bank loans
B. money owed to local and foreign contractors
C. internal and external debts
D. loans granted by IMF and ADB
18. A country's import price index by 1995 was 50 and her index of export prices was 70. Calculate the terms of trade.
A. 20 %
B. 71 %
C. 140 %
D. 120 %
19. In order to accelerate economic development, a country must
A. stimulate her population growth rate
B. pursue a high population growth rate
C. Pursue a rational population policy
D. pursue an incremental population policy
20. GNP is not a good measure of social welfare because there are unrecorded
A. indirect tax
B. social costs
C. government subsidies
D. transfer payments
21. Statistics is used in economics to interpret
A. Geometric events
B. Economic events
C. Harmonic events
D. Algebraic events
22. A budget where current receipts are less than current expenditures is called?
A. Balanced budget
B. Unbalanced budget
C. Deficit budget
D. Surplus budget
23. The market form in which there is only one producer is called
A. unfair competition
B. Monopoly
C. Oligopoly
D. imperfect competition
24. One of the reasons why the barter system was abandoned was because
A. of double coincidence of wants
B. it was too simple
C. it was not reasonable
D. all of the above
25. Inflation can be defined as:
A. When the economy becomes inflated
B. A persistent rise in the general price level over time
C. When there is too much money in circulation
D. When there is a shortage of goods
26. When a generalization is made based on observed facts, it is known as
A. theoretical reasoning
B. normative reasoning
C. deductive reasoning
D. inductive reasoning
27. If the price elasticity of demand for a good is 0.43, an increase in the price of the good will result in
A. a net gain
B. a decrease in profit by 43%
C. a net loss
D. an increase in profit by 43%
28. In a free market economy, the price system allocates resources
A. to their best alternative uses
B. to ensure the general welfare
C. under the government's directive
D. to reduce poverty
29. A normal good with close substitutes is likely to have its price elasticity of demand
A. greater than unity
B. less than unity
C. between zero and one
D. equal to unity
30. A major advantage of specialization and division of labour is that
A. Workers will be adequately rewarded
B. trade unionism will be encouraged
C. time wastage will be minimized
D. there will be a ready market for labour
Instruction: Use the diagram below to answer Questions 31 - 33.
31. The firm portrayed is selling in
A. a purely competitive market
B. a market in which demand is elastic at all prices
C. an imperfectly competitive market
D. a market in which companies produce homogeneous commodities
32. Demand is relatively inelastic
A. at P2 range
B. in the P2P4 price range
C. at P3 only
D. at any price below P2
33. Which of the following statements must hold if price discrimination is to be possible?
A. Elasticity in the various markets must not differ
B. The seller must recognize the possibility of resale
C. The market must not be separated but integrated
D. The market should be separated and there should be no resale.
Instruction: Use the table below to answer Questions 34 and 35.
34. Given the output of 3 units, the average revenue is
A. ₦ 0.:p>
B. ₦ 18.00
C. ₦ 20.00
D. ₦ 24.00
35. Determine the marginal revenue if the total revenue is ₦ 80
A. ₦ 12.00
B. ₦ 14.00
C. ₦ 16.00
D. ₦ 18.00
36. The regulatory authority of the capital market in Nigeria is the
A. Central Bank
B. Securities and Exchanges Commission
C. Nigerian Deposit Insurance Corporation
D. Stock Exchange Market
37. In the long run, the equilibrium point of a monopolistic firm is a point where the
A. marginal cost curve is tangential to the average fixed cost curve
B. demand curve is tangential to the average variable cost curve
C. supply curve is tangential to the marginal cost curve
D. demand curve is tangential to the average cost curve
38. A major assumption in a perfectly competitive market is that
A. the number of buyers and sellers is small
B. individuals cannot influence prices
C. the quality of products remains the same
D. prices will always remain constant
39. One of the techniques of monetary control used by the Central Bank of Nigerian is
A. selective credit control
B. budget deficit
C. foreign exchange control
D. monitoring the general prices
40. Which of the following is true about the value or money?
A. it varies inversely with the price level
B. it varies directly with the price level
C. it depreciates in the period of deflation
D. it is not affected by the price level
ANSWERS:
1. D
2. B
3. B
4. A
5. D
6. A
7. B
8. A
9. A
10. B
11. C
12. D
13. C
14. A
15. C
16. C
17. C
18. C
19. C
20. D
21. B
22. C
23. B
24. A
25. B
26. D
27. B
28. D
29. B
30. C
31. D
32. A
33. C
34. Bonus
35. A
36. B
37. A
38. B
39. B
40. A
1. D
2. B
3. B
4. A
5. D
6. A
7. B
8. A
9. A
10. B
11. C
12. D
13. C
14. A
15. C
16. C
17. C
18. C
19. C
20. D
21. B
22. C
23. B
24. A
25. B
26. D
27. B
28. D
29. B
30. C
31. D
32. A
33. C
34. Bonus
35. A
36. B
37. A
38. B
39. B
40. A
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