1. Which of the following is an economic activity?

A. Attending a town’s meeting

B. visit to the stadium

C. Payment of school fees

D. Arresting a petty thief


2. The reward for land as a factor of production is

A. interest

B. rent

C. dividend

D. wages


3. The three broad categories of production are

A. direct, secondary and extractive

B. primary, tertiary and direct

C. primary, secondary and tertiary

D. secondary, primary and indirect


4. A carpenter’s consumer goods include

I. a kilogram of rice

II.3 pairs of shoes

III. 4 pairs of socks

IV. 3 screw-drivers

A. I and IV only

B. I, II, III and IV

C. I, II and IV only

D. I, II and III only


5. In a capitalist system, the means of productions are owned and controlled by

A. the government

B. politicians

C. private individuals

D. the workers


6. Mixed economy refers to a system in which the means of production are controlled by

A. private enterprise and the government

B. private individuals

C. the government only

D. the worker and businessman


7. An economic good is described as a good which

A. yield utility and commands a price

B. is useful and occupies a space

C. is in high demand and transferable

D. has unlimited supply

8. The concept of opportunity cast is important to the firm because it

A. determines the price of the firm’s product

B. increase the level of output of the firm

C. lead to maximum satisfaction of the consumers

D. guides firms in allocating resources


9. As a firm expands, it enjoys some advantages called

A. variable proportions

B. diminishing marginal returns

C. internal economies of scales

D. decreasing returns of scales


10. Division of labour is limited by

A. the size of the market

B. the productivity of capital

C. cost of production

D. the factors of production


11. An entrepreneur is likely to make more profit when

A. expenditure is more than revenue

B. competitors change lower prices

C. cost per unit output falls

D. quantity of output reduces


12. Natural growth rate is

A. birth rate less death rate

B. death rate less migration

C. death rate plus birth rate

D. birth rate plus migration


13. A major effect of ageing population is

A. reduced labour force

B. rises in prices of commodities

C. reduced infrastructure

D. neglect of agriculture


14. One of the problems associated with the middleman in the distribution of goods is that he

A. he buys in large quantities

B. hoards goods

C.  grants credit to the retailer

D. sell varieties of goods


15.  The distribution of goods is said to be completed when it reaches the

A.  wholesalers

B. consumers

C. retailers

D. manufacturer


16.The gap between demand and supply curves below the equilibrium price indicates

A. excess demand

B. excess supply

C. equilibrium quantity

D. equilibrium price


17. Demand for inferior goods is an example of

A. expansion of demand

B. contraction of demand

C. individual demand

D. abnormal demand


18. When a change in price does not affect the quantity demand of a commodity, the price elasticity of demand is

A. fairly inelastic

B. infinitely inelastic

C. perfectly inelastic

D. unitary elastic


Use the table below to answer question 19 to 21

Price (Dollars)

Quantity Supplied Units






19. The percentage change in supply

A. 20

B. 30

C. 40

D. 50


20. The percentage of change in price

A. 10

B. 20

C. 30

D. 40


21. The elasticity of supply is

A. infinite

B. equal to one

C. less than one

D. equal to zero


22. The line M in the diagram represents

A. total cost

B. fixed cost

C. variable cost

D. average cost


23. For both the monopolist and the perfectly competitive firm, profit maximizing output occurs at the point where the

A. marginal cost curve cuts the marginal revenue from below

B. marginal revenue curve cuts the marginal output

C. marginal cost curve intersect the X-axis

D. marginal revenue curve intersect the Y-axis


24. The market structure in which the operates  are many and none of them can influence the price

A. imperfect market

B. perfect market

C. oligopolistic market

D. stock market


25. One min benefit of partnership is

A. the possibility of raising funds on the stock exchange

B. the possibility of attracting twenty or more members

C. that members can specialize in various functions

D. that it enjoys its separate legal entity


26. Joint ventures are partnership involving

A. the poor and the rich

B. employers and workers

C. government and private investors

D. multinationals and individuals


27. The value of money is best determined by

A. input/output ratio

B. the purchasing power

C. the importance people attached to it

D. economies of scale


28. Which of the following will be an effect of inflation?

A. Wage earners will gain

B. Borrowing of money will be restricted

C. Money lenders will gain

D. Borrower of money will gain


29. Government can control inflation by

A. printing more money

B. reducing the rate of taxes

C. reducing the level of expenditure

D. establishing more banks


30. The market consisting of a network of dealers where currencies can be brought and sold is known as

A. capital market

B. foreign exchange market

C. commodity market

D. the stock market


31. Open market operation (OMO) means the

A. provision of credit facilities by commercial banks

B. provision of credit facilities by the mortgage banks

C. buying and selling of government securities by the central Bank

D. procedure of the establishment of commercial banks


32.  Which of the following is an advantage of localization of industry

A.  Development of subsidiary firms

B. Creation of parallel markets

C. Development of slums

D. Attraction of foreign capital


33. Which of the following will ensure efficiency in the industrial sector of your country

A. Indigenization

B. Privatization

C. Nationalization

D. Liquidation


34. The number of people who are qualified to work and who offer themselves for employment are called

A. migrant workers

B. working population

C. labour turnover

D. mobility of labour


35. When the general price level persistently falls, the rate of unemployment

A. rises

B. stagnates

C. rapidly reduces

D. equals natural growth rate


36 Which of the following is not a direct effort to increase agricultural production?

A. Operation feed the Nation

B. Use of improved seedlings

C. Increased loans to farmers and co-operatives societies

D. National Youth Service Corps


37. To ensure high employment  rates developing countries should

A. build more universities

B. Protect infant industries

C. organise trade fairs

D.  prevent rural –urban drift

38. The act of selling goods in foreign markets at prices below those charged at home is called  

A. Exchange

B. Specialization

C. dumping

D. exporting


39. Taxes levied on commodities are

A. direct taxes

B. indirect taxes

C. poll taxes

D. investment taxes


40.One disadvantage of direct taxes is that

A. government’s revenue is reduced

B. prices of essential commodities fall

C. people are discouraged from additional work

D. firm make more profit


41. International trade is an application of the principle

A. industrial production

B. mass production

C. regional production

D. comparative cost advantage


42. Trade among West African countries is poor because the

A. countries are self sufficient

B. communication links  are weak

C. number of banks is insufficient

D. people are not enterprising


43. A policy by which government restrict the amount of amount currency brought and sold is known as

A. devaluation

B. credit creation

C. exchange control

D. export promotion


44. Which of the following items is under the capital account of a balance of opayment

A. Repayment of foreign loans

B. visible imports

C. invisible exports

D. cocoa exports


45. A surplus in the balance of payment should be used to

A. subsidize multinational companies

B. build infrastructure for the friendly nations

C. make donation to developed countries

D. buy investment overseas


46.Development planning which takes overall view of the economy is described as

A. Aggregate economic planning

B. Disaggregated economic planning

C. sectional economic planning

D. System economic planning


47. The national income of a country can be estimated by the

A. cost-benefit method

B. distribution method

C. expenditure method

D. consumption method


48. Which of the following is excluded when estimating national income

A. Dividend

B.  Wages and salaries

 C. Transfer’ payment

D. profits


49. The Economic Community of West Africa States (ECOWAS) has been slow in achieving its objectives because of

A. political instability

B. the activities of multinationals

C. inadequate personnel at the secretariat

D. inadequate international support


50. A major achievement of the organization of Petroleum Exporting Countries (OPEC) is that

A. crude oil price has increased tremendously

B. Petroleum products prices have remained low

C.  producing countries are highly industrialized

D. Price of crude oil has remained relatively stable