MOCK ECONOMICS EXAM

Labour intensive technique of production is good in a country with

• high capital concentration

• high death rate

• high population density

• high rate of illiteracy

If successive units of labour are added to a piece of land while capital and technology remains constant, a point will be reached in the level of production when each added unit of labour will add less to the output than the previous units of labour. This concept is known as

• labour intensive production

• the concept of factor intensity

• the law of diminishing marginal utility

• the law of diminishing returns

Given the demand function Qd= 400 + 2p. Find the quantity demanded when the price is 16

• 460

• 450

• 432

• 440

External economies are

• the advantages accruing to a firm as a result of its expansion

• the advantages accruing to one firm as a result of the existence of other firms in the same locality

• benefits derived by a firm as a result of its own individual policy

• bound to increase the costs of production whatever the circumstances

In a free market economy, the rationing of scarce resources is done principally by the

• government

• business organisation

• price mechanism

• consumers

In a capitalist economy, wealth is likely to be

• concentrated in a few hands

• evenly distributed

• owned by the government

• owned by the traders only

The economy of most West African states can be described as

• socialist

• welfares

• Mixed

• capitalist

When demand curce shifts to the right,it indicates that a larger quantity is demanded at each price. This is caused by which of the following?

• A fall in income

• A rise in the price of a complement

• A fall in price of the commodity

• A change in taste of this commodity

The quanitity supplied of a commodity increases when

• production falls

• demand increases

• price of the commodity increases

• consumer's income reduces

An increase in supply with no change in demand will

• lower the price and increae the quantitity demanded

• lower the price and leave the quantity demanded constant

• lower the price and reduce the quantity supplied

• raise the price and reduce the quantity demanded