Practice waec model questions vol1 economics 2018 Past Questions

Question 1 View Details

A country's population was 150 million at the start of 2010. From 2010 to 2015 the annual natural increase (births minus deaths) rate was 2.4% and net migration added 0.3% per year. From 2015 to 2020 the natural increase fell to 1.6% and net migration became a loss of 0.2% per year. (a) Calculate the population at the end of 2020 (rounded to two decimal places). (b) The government now wishes the population to reach exactly 200 million by the end of 2025 by maintaining a uniform annual growth rate from 2020 onward. What constant annual growth rate (in % per year, to two decimal places) is required?

A. (a) 185.23 million; (b) 1.65%

B. (a) 183.71 million; (b) 1.85%

C. (a) 180.90 million; (b) 1.78%

Correct D. (a) 183.71 million; (b) 1.71%

Correct Answer: D

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Question 2 View Details

A farmer has 100 hectares of land to allocate between wheat and maize. Yield per hectare: wheat 2.5 tonnes, maize 3 tonnes. Market prices: wheat ₦120 per kg, maize ₦90 per kg. Production cost per hectare: wheat ₦150,000, maize ₦180,000. Because of soil fertility, the profit per hectare for wheat is ₦150,000 for the first 50 ha and then falls by ₦5,000 for each additional hectare. For maize the profit per hectare is ₦90,000 for the first 40 ha and then falls by ₦3,000 for each additional hectare. The farmer must allocate at least 30% of the land to wheat and cannot allocate more than 60% to maize. Determine the optimal allocation of hectares to wheat and maize that maximises total profit and state the maximum profit (in ₦).

A. 64 ha wheat, 36 ha maize; maximum profit = ₦12,260,000

Correct B. 62 ha wheat, 38 ha maize; maximum profit = ₦12,330,000

C. 58 ha wheat, 42 ha maize; maximum profit = ₦12,080,000

D. 60 ha wheat, 40 ha maize; maximum profit = ₦12,150,000

Correct Answer: B

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Question 3 View Details

A transport company plans to start a new bus service between City A and City B. Fixed monthly cost is ₦2,000,000 and the variable cost per passenger is ₦500. The ticket price is set at ₦P. Monthly passenger demand is given by Q = 10,000 - 3P (where Q is the number of passengers and P is the ticket price in ₦). The company wants a monthly profit of at least ₦500,000. Determine the minimum ticket price that will achieve this profit target and the corresponding expected number of passengers.

A. Minimum ticket price ≈ ₦900; expected passengers ≈ 7,300 per month

Correct B. Minimum ticket price ≈ ₦834; expected passengers ≈ 7,500 per month

C. Minimum ticket price ≈ ₦750; expected passengers ≈ 7,750 per month

D. Minimum ticket price ≈ ₦800; expected passengers ≈ 7,600 per month

Correct Answer: B

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Question 4 View Details

A manufacturing firm produces widgets. Its total cost function (in ₦) is TC = 5,000,000 + 200Q - 0.02Q², where Q is output in units. The market demand for widgets is P = 500 - 0.05Q (₦ per unit). (a) Determine the output level that maximises profit and compute the maximum profit. (b) At that output, calculate the average total cost and state whether the firm should continue production in the long run if the market price is below average total cost.

A. Output = 5,000 units; maximum profit = -₦4,250,000 (loss); ATC = ₦900; since price (₦250) > ATC, the firm should continue production.

B. Output = 6,000 units; maximum profit = -₦5,100,000 (loss); ATC = ₦1,200; since price (₦250) < ATC, the firm should cease production.

C. Output = 4,000 units; maximum profit = -₦3,800,000 (loss); ATC = ₦1,050; since price (₦250) < ATC, the firm should cease production.

Correct D. Output = 5,000 units; maximum profit = -₦4,250,000 (loss); ATC = ₦1,100; since price (₦250) < ATC, the firm should cease production.

Correct Answer: D

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Question 5 View Details

The demand for a product is Qd = 800 - 4P and the supply is Qs = 200 + 2P, where Q is quantity and P is price in ₦. (a) Find the equilibrium price and quantity. (b) If the government imposes a tax of ₦50 per unit on sellers, what is the new equilibrium price paid by buyers?

A. Equilibrium price = ₦120, quantity = 360; after tax, price paid by buyers ≈ ₦132

Correct B. Equilibrium price = ₦100, quantity = 400; after tax, price paid by buyers ≈ ₦117

C. Equilibrium price = ₦100, quantity = 350; after tax, price paid by buyers ≈ ₦115

D. Equilibrium price = ₦80, quantity = 480; after tax, price paid by buyers ≈ ₦102

Correct Answer: B

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Question 6 View Details

The market demand for a product is given by P = 120 - 2Q, where P is the price (₦) and Q is the quantity demanded. The firm's marginal cost is constant at ₦20 per unit. Assuming the firm is a monopoly, calculate the dead‑weight loss (in ₦) that results from monopoly pricing.

A. 500

B. 750

C. 900

Correct D. 625

Correct Answer: D

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Question 7 View Details

A per‑unit tax of ₦10 is imposed on a good. The price elasticity of demand is -0.5 and the price elasticity of supply is 1.0. Assuming the tax is levied on producers, determine the amount of the tax that is ultimately borne by consumers (in ₦, rounded to two decimal places).

A. 8.33

Correct B. 6.67

C. 10.00

D. 5.00

Correct Answer: B

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Question 8 View Details

Using the income approach, compute the National Income (NI) for an economy with the following data (in ₦ billions): Consumption = 500, Investment = 150, Government spending = 200, Exports = 80, Imports = 120, Indirect taxes = 50, Subsidies = 20, Depreciation = 80, Net factor income from abroad = -10.

A. 650

B. 730

C. 770

Correct D. 690

Correct Answer: D

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Question 9 View Details

In a market with two identical firms that compete à la Cournot, the market demand is P = 200 - Q, where Q = q₁ + q₂. Each firm has a constant marginal cost of ₦20. (a) Determine the Cournot‑Nash equilibrium output of each firm, the total market output and the market price. (b) If the two firms collude and act as a monopoly, what price will they charge? Provide only the monopoly price (in ₦).

A. 100

Correct B. 110

C. 120

D. 130

Correct Answer: B

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Question 10 View Details

A farmer can produce either 100 kg of rice or 200 kg of beans with the same resources. If the farmer decides to produce 80 kg of rice, how many kilograms of beans constitute the opportunity cost of this choice?

Correct A. 160

B. 120

C. 80

D. 200

Correct Answer: A

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Question 11 View Details

A bus company incurs a fixed monthly cost of ₦300,000 and a variable cost of ₦50 per passenger. The demand for seats is given by Q = 20,000 - 40P, where P is the fare (in Naira) and Q is the number of passengers per month. What fare should the company charge to maximise its monthly profit, and what is the maximum profit?

A. Fare = ₦250; Maximum profit = ₦1,500,000

B. Fare = ₦260; Maximum profit = ₦1,600,000

Correct C. Fare = ₦275; Maximum profit = ₦1,725,000

D. Fare = ₦300; Maximum profit = ₦1,800,000

Correct Answer: C

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Question 12 View Details

In a country the public holds currency equal to 30% of bank deposits. The central bank requires banks to keep 10% of deposits as reserves. If the central bank injects ₦200 million into the banking system through an open‑market purchase, what is the total increase in the money supply?

A. ₦500,000,000

B. ₦600,000,000

Correct C. ₦650,000,000

D. ₦750,000,000

Correct Answer: C

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Question 13 View Details

A factory produces widgets according to the total product function TP = 20L - 0.5L², where L is the number of workers employed. Fixed capital cost is ₦20,000 per month and each worker is paid a wage of ₦5,000 per month. The market price of a widget is ₦500. Determine the number of workers that maximises profit and state the maximum profit.

A. 8 workers; Maximum profit = ₦4,000

B. 15 workers; Maximum profit = ₦2,500

C. 12 workers; Maximum profit = ₦6,000

Correct D. 10 workers; Maximum profit = ₦5,000

Correct Answer: D

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Question 14 View Details

Country X has a labour force of 8 million. Its natural rate of unemployment is 6%. During a recession cyclical unemployment rises to 4% of the labour force. After the economy recovers, cyclical unemployment falls by half. What is the overall unemployment rate after recovery and how many people are unemployed?

A. 6%; 480,000 unemployed

B. 7%; 560,000 unemployed

Correct C. 8%; 640,000 unemployed

D. 10%; 800,000 unemployed

Correct Answer: C

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Question 15 View Details

In 2020 a country's population was 20 million. For the next five years it grew at an annual compound rate of 2.5%. In 2025 a family‑planning policy reduced the annual growth rate to 1.5% and a net migration of 50 000 people per year began. What is the population at the end of 2030? Give your answer rounded to the nearest thousand.

Correct A. 24,635,000

B. 24,125,000

C. 25,000,000

D. 23,800,000

Correct Answer: A

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Question 16 View Details

In a certain market the equilibrium price of a good is ₦500 per unit and the equilibrium quantity is 2,000 units. The government imposes a price ceiling of ₦400 per unit. At this ceiling price the quantity demanded rises to 2,600 units while the quantity supplied falls to 1,500 units. What is the size of the shortage created by the price ceiling (in units)?

Correct A. 1,100

B. 1,000

C. 1,300

D. 1,200

Correct Answer: A

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Question 17 View Details

Country X exports 1,000 tonnes of cocoa and imports 800 tonnes of rice. One tonne equals 1,000 kg. The world price of cocoa is $2 per kg and the price of rice is $1.5 per kg. If the world price of cocoa rises to $2.5 per kg while the price of rice remains unchanged, what is the percentage change in the value of Country X's trade balance (export value minus import value)? Express your answer to one decimal place.

A. 55.0

B. 45.0

C. 70.0

Correct D. 62.5

Correct Answer: D

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Question 18 View Details

A specific tax of ₦50 per unit is imposed on a good. The market demand is Qd = 500 - 2P and the market supply (before tax) is Qs = 3P - 150, where P is the price in Naira. Determine (a) the price paid by consumers after the tax, (b) the price received by producers after the tax, (c) the equilibrium quantity after the tax, (d) the total tax revenue, and (e) the dead‑weight loss caused by the tax.

A. Tax revenue = ₦10,500; Deadweight loss = ₦1,200

B. Tax revenue = ₦9,500; Deadweight loss = ₦1,800

Correct C. Tax revenue = ₦9,000; Deadweight loss = ₦1,500

D. Tax revenue = ₦8,000; Deadweight loss = ₦2,000

Correct Answer: C

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Question 19 View Details

Country Y exports coffee and imports machinery. The world price of coffee is $200 per kg and the demand for coffee (exports) is given by P = 500 - 0.1Q, where Q is the quantity exported in thousand kilograms. The government imposes an export tax of $20 per kg on coffee. The country imports 400 units of machinery at a price of $150 per unit. The government is also considering a 10 % tariff on machinery imports. Calculate (a) the effective price received by coffee exporters after the tax, (b) the quantity of coffee exported, (c) the total revenue from the export tax, (d) the tariff revenue from machinery imports, and (e) the new trade balance (export revenue minus import expenditure) after both policies are applied.

A. Effective price = $180/kg; Export quantity = 3,200,000 kg; Export‑tax revenue = $64,000,000; Tariff revenue = $7,500; New trade balance = $572,500,000 (a reduction of $27,500,000 from the original)

B. Effective price = $180/kg; Export quantity = 3,000,000 kg; Export‑tax revenue = $60,000,000; Tariff revenue = $5,000; New trade balance = $570,000,000 (a reduction of $30,000,000 from the original)

Correct C. Effective price = $180/kg; Export quantity = 3,200,000 kg; Export‑tax revenue = $64,000,000; Tariff revenue = $6,000; New trade balance = $575,934,000 (a reduction of $24,006,000 from the original)

D. Effective price = $190/kg; Export quantity = 3,200,000 kg; Export‑tax revenue = $64,000,000; Tariff revenue = $6,000; New trade balance = $580,000,000 (a reduction of $20,000,000 from the original)

Correct Answer: C

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Question 20 View Details

A firm's total cost (TC) function for producing Q units of a product is TC = 5,000 + 20Q + 0.05Q² (in Naira). The market price is given by the inverse demand function P = 200 - 0.1Q. Determine (a) the output level that maximizes profit, (b) the maximum profit, and (c) the break‑even output(s).

A. Profit‑maximising output = 600 units; Maximum profit = ₦45,500; Break‑even outputs ≈ 30 units and 1,180 units

B. Profit‑maximising output = 650 units; Maximum profit = ₦52,000; Break‑even outputs ≈ 25 units and 1,200 units

Correct C. Profit‑maximising output = 600 units; Maximum profit = ₦49,000; Break‑even outputs ≈ 29 units and 1,172 units

D. Profit‑maximising output = 500 units; Maximum profit = ₦45,000; Break‑even outputs ≈ 35 units and 1,150 units

Correct Answer: C

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Question 21 View Details

The Consumer Price Index (CPI) was 100 in the base year 2015. It rose to 112 in 2017 and to 119 in 2018. A worker earned ₦20,000 in 2017 and ₦22,500 in 2018 (nominal wages). Calculate the percentage growth in the worker's real wage between 2017 and 2018. Express your answer to two decimal places.

A. 6.21%

B. 4.73%

Correct C. 5.89%

D. 3.58%

Correct Answer: C

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Question 22 View Details

A country recorded a Gross Domestic Product (GDP) of ₦4.5 trillion. Its Gross National Product (GNP) is known to be 10% higher than GDP. Depreciation (consumption of fixed capital) equals 5% of GNP. The population is 5 million people. Determine the Net National Product (NNP) per capita, expressed in million Naira, rounded to two decimal places.

A. 1.12 million Naira

B. 0.78 million Naira

Correct C. 0.94 million Naira

D. 1.05 million Naira

Correct Answer: C

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Question 23 View Details

The total product (TP) of a firm when labour L (in units) is employed is given by $TP(L) = -0.1L^{3}+6L^{2}-8L$. Determine the labour input at which the average product of labour (AP) is maximised and state the maximum AP value.

A. 32 workers; 85 units per worker

B. 28 workers; 78 units per worker

Correct C. 30 workers; 82 units per worker

D. 25 workers; 80 units per worker

Correct Answer: C

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Question 24 View Details

A lighthouse provides illumination that can be used by any ship at sea without reducing its usefulness to others, and it is impossible to exclude a ship from benefiting from the light. State whether the lighthouse is rival in consumption and whether it is excludable.

Correct A. Non‑rival and non‑excludable

B. Rival and non‑excludable

C. Non‑rival and excludable

D. Rival and excludable

Correct Answer: A

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Question 25 View Details

In a country with a labour force of 8 million, the overall unemployment rate is 12%. Frictional unemployment accounts for 2% and structural unemployment for 4% of the labour force. Calculate the number of people who are cyclically unemployed.

A. 640000

B. 800000

C. 320000

Correct D. 480000

Correct Answer: D

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