Economics Questions and Answers
Economics questions and answers to help you prepare for JAMB, WAEC, NECO, Post UTME and job aptitude tests or interviews.
Economics questions and answers to help you prepare for JAMB, WAEC, NECO, Post UTME and job aptitude tests or interviews.
Average product
Total product
Average variable cost
Total cost
Correct answer is B
Total product is the overall quantity of output that a firm produces, usually specified in relation to a variable input. Total product is the starting point for the analysis of short-run production. It indicates how much output a firm can produce according to the law of diminishing marginal returns.
Marginal Product (MP) = Change in Total Product / Change in Variable Factor
Total Product (TP) = AP X Variable Factor
Adding up the marginal cost at each level
Dividing the total cost of output at each level
Adding up the average variable cost at each level
Adding up the total variable cost and total fixed cost
Correct answer is D
Total cost refers to the total expense incurred in reaching a particular level of output. TC (total cost) = TFC (total fixed cost) + TVC (total variable cost).
The law of diminishing marginal returns relate to
Total utility
Average utility
Total product
Marginal utility
Correct answer is D
Marginal utility is the additional satisfaction a consumer gains from consuming one more unit of a good or service. As a consumer consumes more units of a product, the marginal utility derived eventually drops. This relates with the law of diminishing marginal returns which states that, there will be a decrease in the marginal output of a production process as the amount of a single factor of production is incrementally increased, while the amounts of all other factors of production stay constant.
All the following are methods of determining prices except?
Maximum pricing
Rationing
Minimum pricing
Auctioning
Correct answer is D
A maximum price occurs when a government sets a legal limit on the price of a good or service – with the aim of reducing prices below the market equilibrium price.
Minimum Prices. It is known as minimum price or pricefloor when the government sets a minimum legal limit of a price of a particular good or service.
In economics, rationing refers to an artificial control of the supply and demand of commodities.
Which of the following will not affect the market price of a commodity?
Increase in demand
Change in taste
Intersection of demand and supply
Increase in supply
Correct answer is C
6 Factors Affecting Price Determination of...