waec model questions vol1 2024 economics | Essay

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Question 1 View Details
Scarcity is a fundamental concept in economics. Using this concept, answer the following questions.
Question Parts
(a)
Define scarcity and explain why it inevitably leads to the need for choice.
(b)
Define opportunity cost and illustrate, with a specific example of a Nigerian household, how opportunity cost influences the allocation of a limited monthly income between food and education.
(c)
Discuss how understanding scarcity and opportunity cost can help individuals make better economic decisions.
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Question 2 View Details
In a certain region, a severe drought has reduced the harvest of maize, a staple food. The market for maize can be described by the linear demand equation Qd = 8,000 – 20P and the original linear supply equation Qs = 2,000 + 10P, where Q is quantity in tonnes and P is price in Naira per kilogram.
Question Parts
(a)
Determine the original market equilibrium price and quantity. Then, assuming the drought shifts the supply curve leftward by 1,000 tonnes at every price (i.e., the new supply equation becomes Qs' = 1,000 + 10P), calculate the new equilibrium price and quantity.
(b)
Using the equilibrium values obtained in part (a), compute the change in consumer surplus and producer surplus caused by the drought. Show all steps and state the monetary change in Naira.
(c)
Suggest two government policy measures that could alleviate the adverse effects of the drought on consumers. For each measure, explain briefly how it would affect the demand or supply curve and the resulting equilibrium.
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Question 3 View Details
A market researcher collected data on the demand for a locally produced mango juice. The table shows the average price per litre (in Naira) and the corresponding average quantity demanded per week. | Price (₦ per litre) | Quantity demanded (litres per week) | |----------------------|--------------------------------------| | 200 | 800 | | 250 | 640 | | 300 | 520 | Using the information above, answer the following questions.
Question Parts
(a)
Calculate the price elasticity of demand between the price of ₦200 and ₦250 using the midpoint method. State whether demand is elastic, inelastic or unitary in this range.
(b)
Calculate the price elasticity of demand between ₦250 and ₦300 using the midpoint method. Compare this elasticity with that obtained in part (a) and explain what the change indicates about consumer responsiveness as price rises.
(c)
The government is considering imposing a tax that would raise the price of mango juice from ₦250 to ₦300 per litre. Based on your elasticity calculations, discuss the likely impact of the tax on total revenue for sellers and on consumer welfare.
(d)
If the income of consumers rises by 10 % and the quantity demanded of mango juice rises by 5 %, compute the income elasticity of demand and classify the good as normal or inferior, and as a necessity or luxury.
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Question 4 View Details
A small‑scale bakery employs labour (workers) while keeping capital (oven, equipment) fixed in the short run. The table shows the weekly output (loaves of bread) produced as the number of workers employed varies. | Workers (L) | Total Output (loaves) | |-------------|-----------------------| | 0 | 0 | | 1 | 120 | | 2 | 260 | | 3 | 360 | | 4 | 420 | | 5 | 450 | Answer the following questions.
Question Parts
(a)
Compute the marginal product of labour (MPL) and the average product of labour (APL) for each additional worker from the second to the fifth worker. Present your results in a table.
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Question 5 View Details
A small manufacturing firm produces wooden chairs. The firm’s total cost (TC) in Naira for producing Q chairs can be expressed as TC = a + bQ + cQ², where a, b and c are constants. The following information is known: - When the firm produces 0 chairs, its total cost is ₦120,000 (fixed cost). - The average total cost (ATC) of producing 100 chairs is ₦2,500 per chair. - The marginal cost (MC) of the 101st chair is ₦3,200. Answer the questions that follow.
Question Parts
(a)
Determine the numerical values of the constants a, b and c.
(b)
Using the cost function obtained, calculate the output level at which the firm breaks even if the market price per chair is ₦3,000.
(c)
Discuss two possible reasons why the firm might choose not to produce at the break‑even output even though it would cover all costs.
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Question 6 View Details
Consider a market for a locally produced fruit juice. The market can be described by the following characteristics: - There are 12 firms, each producing an identical product. - The market demand curve is P = 5,000 – 20Q, where Q is total quantity demanded (in litres) and P is price per litre in Naira. - Each firm has a constant marginal cost of ₦1,200 per litre and no fixed cost. Answer the questions that follow.
Question Parts
(a)
Identify the market structure that best fits the description and justify your answer with reference to the given characteristics.
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Question 7 View Details
The table below shows selected macro‑economic aggregates for Nigeria in the year 2023 (all values in billions of naira).
Question Parts
(a)
Using the expenditure approach, calculate the Gross Domestic Product (GDP) for 2023. Show clearly how you combine the given aggregates.
(b)
Given that Net Factor Income from abroad (NFIA) for the same year is –₦120 billion, compute the Gross National Product (GNP). Explain the relationship between GDP and GNP.
(c)
Depreciation (consumption of fixed capital) for 2023 is ₦250 billion. Determine the Net National Product (NNP) and discuss why NNP is considered a better indicator of the economy’s productive capacity than GDP.
(d)
Critically evaluate two major limitations of using GDP as a measure of welfare in Nigeria.
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Question 8 View Details
Consider the following monetary data for Nigeria in 2024:
Question Parts
(a)
State and briefly explain the three primary functions of money in a modern economy.
(b)
The reserve requirement ratio set by the Central Bank is 15 %. The public holds a currency‑deposit ratio of 0.20. Calculate the money multiplier and the maximum potential increase in the money supply if the Central Bank injects ₦500 billion of new reserves into the banking system.
(c)
In March 2024 the Central Bank conducted an open‑market sale of ₦200 billion government securities. Discuss qualitatively how this operation affects (i) the money supply, (ii) the prevailing interest rate, and (iii) aggregate demand in the short run.
(d)
Given Nigeria’s persistent high inflation, evaluate the effectiveness of monetary policy tools (open‑market operations, reserve requirement, and discount rate) in curbing inflation, citing at least one structural challenge that limits their impact.
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