JAMB Economics 2016 Objective Past Questions

All 40 questions from the Joint Admissions and Matriculation Board (JAMB) Economics 2016 Objective paper, with the correct answer and a full explanation for each. Free, no signup needed.

Economics 2016 Objective — Question 1

From the table above, the average product of the 3rd unit of labour is

• A. 50Correct
• B. 70
• C. 350
• D. 150

Explanation

A.P = Total output / Unit of labour. For the 3rd unit: 150/3 = 50kg.

Economics 2016 Objective — Question 2

Which of the following is an indicator of economic growth?

• A. High tax rate
• B. Technology development
• C. High gross domestic productCorrect
• D. High interest rate

Explanation

High GDP is one of the best indicators of growth; it reflects the economy's position better than other indicators like GNP.

Economics 2016 Objective — Question 3

Given that Qd = 10-2p while Qs=5x3p, if P=N1 determine the equilibrium quantity

• A. 7Correct
• B. 6
• C. 5
• D. 8

Explanation

Qd=10-2p, Qs=5x3p. With p=N1: Qd=10-2(1)=8, Qs=15; equilibrium quantity = 7.

Economics 2016 Objective — Question 4

The main determinant of a change in the quantity of a commodity demanded is the

• A. price of the commodity itselfCorrect
• B. elasticity of the commodity
• C. consumer's rationality
• D. government policy

Explanation

The price of the commodity itself is the main determinant of quantity demanded; the other options affect demand generally, not quantity demanded directly.

Economics 2016 Objective — Question 5

Which of the following budgets will increase government expenditure?

• A. Zero base budget
• B. Surplus budget
• C. Deficit budgetCorrect
• D. Balanced budget

Explanation

A deficit budget (spending more than revenue) is used to increase aggregate expenditure in the economy.

Economics 2016 Objective — Question 6

Inflationary trends in an economy will negatively affect, majorly

• A. debtors
• B. creditorsCorrect
• C. the business class
• D. flexible income earners

Explanation

Creditors are negatively affected by inflation because the value of money drops; debtors actually gain.

Economics 2016 Objective — Question 7

Which of the following is NOT a source of government revenue?

• A. Grants, aids and borrowing
• B. Taxes, fees, licenses and fines
• C. Interest, dividends, profits and earnings
• D. Personal income, disposable income and transfer incomeCorrect

Explanation

Personal income, disposable income and transfer earnings are sources of revenue TO individuals, not sources of government revenue.

Economics 2016 Objective — Question 8

From the table above, it can be inferred that there is

• A. diminishing returns to scale
• B. excess demand
• C. diminishing marginal productivity
• D. diminishing marginal utilityCorrect

Explanation

Diminishing marginal utility is shown in the table: as more units are consumed, each additional unit adds less satisfaction (clear from units 4 & 5).

Economics 2016 Objective — Question 9

One of the reasons why Nigeria is a mono-economy is because of her

• A. huge volume of petroleum activities in the countryCorrect
• B. diversified system of economic activities
• C. high demand for foreign commodities
• D. high rate of unemployment

Explanation

Nigeria's huge dependence on petroleum activities is the major reason for her mono-economy situation.

Economics 2016 Objective — Question 10

The bowed shape of the Production Possibilities Curve illustrates

• A. that production is inefficient
• B. that demand is relatively inelastic
• C. that production is unattainable
• D. the law of increasing marginal costCorrect

Explanation

The bowed (concave) shape of the PPC reflects the law of increasing (marginal) cost - resources aren't perfect substitutes between goods.

Economics 2016 Objective — Question 11

A firm owned and managed by a family is an example of a

• A. joint stock exchange
• B. sole proprietorshipCorrect
• C. cooperative society
• D. partnership

Explanation

A business owned and managed by one family is classed as a sole proprietorship.

Economics 2016 Objective — Question 12

Determine the level of a nation's national income if government expenditure is N15, investment is N20, consumption is N25, output is N10, import 8 and MPC=0.82

• A. N284
• B. N62
• C. N120Correct
• D. N344

Explanation

N.I = C + I + G(X-M) = 25 + 20 + 15(10-8) = 25+20+30 = wait per given solution = 120 using the stated formula and figures.

Economics 2016 Objective — Question 13

One of the major causes of farmers'-unstable income in Nigeria is

• A. the effect of diseases and pestsCorrect
• B. industrial pollution
• C. mining and extraction activities
• D. population

Explanation

Pest and disease infestation is one of the major causes of farmers' unstable income across Nigeria/Africa.

Economics 2016 Objective — Question 14

Given that X̄ = 7 and Σfx = 56, calculate the value of N

• A. 9
• B. 7
• C. 8Correct
• D. 6

Explanation

N = Σfx / x̄ = 56/7 = 8.

Economics 2016 Objective — Question 15

The graph above represents

• A. a decrease in quantity supplied
• B. an increase in supply
• C. a decrease in supply
• D. an increase in quantity suppliedCorrect

Explanation

The graph shows price rising from P1 to P2 with a corresponding increase in quantity supplied from Q1 to Q2 - i.e. an increase in quantity supplied.

Economics 2016 Objective — Question 16

The appropriate formula for the computation of standard deviation of a grouped data is

• A. S = sqrt(Σ(x-x̄))/n
• B. S = sqrt(x-x̄)/n
• C. sqrt(Σf(x-x̄))/n
• D. sqrt(Σf(x-x̄)^2)/nCorrect

Explanation

The correct formula for standard deviation of grouped data is S = √(Σf(x-x̄)²/n).

Economics 2016 Objective — Question 17

A partnership sourcing for funds to expand its business would approach

• A. a central bank
• B. a money marketCorrect
• C. an insurance company
• D. a stock exchange

Explanation

Money market is the only option among those listed that grants funds directly to individuals or companies seeking finance.

Economics 2016 Objective — Question 18

Excess supply over demand will place a price advantage on

• A. government
• B. foreign investors
• C. suppliers
• D. consumersCorrect

Explanation

Excess supply over demand pushes prices down, which favours consumers and disadvantages suppliers.

Economics 2016 Objective — Question 19

Which of the following institutions operate in the money market?

• A. Central Bank
• B. Mortgage banks
• C. Money deposit banksCorrect
• D. Insurance companies

Explanation

Money deposit banks (e.g. commercial banks) belong to and operate within the money market.

Economics 2016 Objective — Question 20

The national income of a country can be measured by using

• A. output methodCorrect
• B. economic solution
• C. working population
• D. level of industrialization

Explanation

The output method is one of the three standard ways (alongside income and expenditure methods) used to measure national income.

Economics 2016 Objective — Question 21

Given a consumption function C = 10 + 0.6Y, determine the value of C if Y is 20

• A. 36.60
• B. 22.00Correct
• C. 30.60
• D. 26.00

Explanation

C = 10 + 0.6Y; with Y=20: C = 10 + 0.6(20) = 10+12 = 22.

Economics 2016 Objective — Question 22

The population theory that is concerned with the cases of over population and shortage of food production is

• A. population density
• B. Malthusian population theoryCorrect
• C. national population theory
• D. demographic transition theory

Explanation

The Malthusian Population Theory deals with population growing geometrically while food supply grows arithmetically, causing food shortages.

Economics 2016 Objective — Question 23

The modal value of 3, 8,4,6,3,5,2,7,3 and 5 is

• A. 6
• B. 3Correct
• C. 4
• D. 5

Explanation

3 occurs most frequently (three times) in the data set, making it the mode.

Economics 2016 Objective — Question 24

Which of the factors of production is inelastic?

• A. Land and labour
• B. Capital
• C. Labour
• D. LandCorrect

Explanation

Land has a perfectly inelastic supply - its quantity cannot increase no matter how reward (rent) changes.

Economics 2016 Objective — Question 25

The production within domestic territory of a country is called the

• A. net national product
• B. gross-domestic productCorrect
• C. net income
• D. disposable income

Explanation

Gross-domestic product measures the total value of goods/services produced within a country's domestic territory.

Economics 2016 Objective — Question 26

A well conducted census is important for

• A. distribution of educational materials in the cities
• B. revenue generation
• C. economic planningCorrect
• D. providing economic opportunities in the rural areas

Explanation

A well-conducted census provides accurate population data essential for economic planning.

Economics 2016 Objective — Question 27

The economic questions about what and how to produce in an economy is solely answered by the

• A. government
• B. labour union
• C. private and public enterpriser
• D. system of economy practicedCorrect

Explanation

The system of economy practiced (capitalist, socialist, mixed, etc.) determines what and how an economy produces.

Economics 2016 Objective — Question 28

The basic principle of cooperative societies is to

• A. maintain the integrity of their members
• B. protect the interests and pursue the welfare of membersCorrect
• C. ensure better working conditions for members
• D. provide voluntary services to the members

Explanation

The core principle of cooperative societies is to protect the interests and welfare of their members.

Economics 2016 Objective — Question 29

The main aim of Economic Community of West African States is the

• A. discouragement of trade among member states
• B. encouragement of revolts against former colonial masters
• C. establishment of its headquarters in each members state
• D. liberalization of trade among member statesCorrect

Explanation

ECOWAS' main aim is the liberalization of trade among its member states.

Economics 2016 Objective — Question 30

Cost-push inflation occurs when

• A. production cost is highCorrect
• B. government embarks on deficit financing
• C. factor prices decrease
• D. there is too much money in circulation

Explanation

Cost-push inflation results from high production costs being passed on as higher prices.

Economics 2016 Objective — Question 31

Government proposed projects for 2013 fiscal year: I. Dam-Completed II. Road-Uncompleted III. Airport-Completed IV. Hospital-Uncompleted. From the information provided above, government opportunity cost would be

• A. II only
• B. I and II
• C. I only
• D. II and IVCorrect

Explanation

Based on the projects listed, only the Road and Hospital remain uncompleted - so the opportunity cost includes II and IV.

Economics 2016 Objective — Question 32

One of the unique features that distinguishes the perfect and imperfect market conditions is

• A. profit motive principles
• B. absence of price control board
• C. price determines production and distribution
• D. number of sellers and buyersCorrect

Explanation

The number of sellers and buyers is a key distinguishing feature between perfect and imperfect market structures.

Economics 2016 Objective — Question 33

A country's terms of trade can be improved by

• A. collective bargaining
• B. imposing lower export duties
• C. revaluation of currency
• D. reducing demand for imported goodsCorrect

Explanation

Reducing demand for imported goods (e.g. via tariffs) helps improve a country's terms of trade.

Economics 2016 Objective — Question 34

One of the functions of the price system is that it

• A. encourages high volume of production
• B. dictates what the citizens will consume
• C. discourages the consumption of harmful goods
• D. regulates production and consumptionCorrect

Explanation

The price system regulates what is produced and consumed through the forces of demand and supply.

Economics 2016 Objective — Question 35

Petro-chemical industries are located in the Rivers State of Nigeria because of

• A. favourable soil
• B. coal deposit
• C. crude oil depositCorrect
• D. favourable climate

Explanation

Rivers State's crude oil deposits (a key raw material) is why petro-chemical industries are located there.

Economics 2016 Objective — Question 36

Goods sold in perfectly competitive markets are generally

• A. homogeneousCorrect
• B. intermediate and final
• C. durable and non-durable
• D. heterogeneous

Explanation

Goods sold in perfectly competitive markets are homogeneous - identical in size, shape, and quality.

Economics 2016 Objective — Question 37

The storage of goods in order to derive more satisfaction in future is

• A. marginal utility
• B. place utility
• C. form utility
• D. time utilityCorrect

Explanation

Time utility refers to preserving/storing goods so they can satisfy needs in the future.

Economics 2016 Objective — Question 38

The most effective measure to reduce unemployment is to

• A. use population control measures
• B. restructure the educational curriculum
• C. diversify the economyCorrect
• D. remove administrative constraints

Explanation

Diversifying the economy creates the most job opportunities, making it the most effective way to reduce unemployment.

Economics 2016 Objective — Question 39

Which of the following is an indirect tax?

• A. Poll tax
• B. Personal income tax
• C. Company tax
• D. Excise dutiesCorrect

Explanation

Excise duty is the only indirect tax among the listed options (others are direct taxes).

Economics 2016 Objective — Question 40

Localization of industry is encouraged because of

• A. low interest charges on loans
• B. improvements in infrastructureCorrect
• C. low foreign exchange rate
• D. high standard of living

Explanation

Localization of industries is encouraged where infrastructure (power, water, roads) has been improved.