Bank consolidation policy in Nigeria is a measure to increase
The capital base of banks
Employment opportunities in banks
The number of shareholders
The number of branches
Correct answer is A
Bank consolidation is the process by which one banking company takes over or merges with another. This leads to a potential expansion for the merging bank. It is usually done to maintain and reach the required capital base as instituted by the central bank.
A bank's capital base is the "cushion" for potential losses, that protects the bank's depositors and other lenders. It is the required amount set aside in assets to mitigate against losses.
The profit of a monopolist can be eliminated where price equals
AFC
MC
AC
AVC
Correct answer is B
Monopolies make profits by creating prices that are higher, and output that is lower. Profits would be eliminated when price is equal to marginal cost. That is the cost incurred by a firm by producing one additional unit of a product or service. The monopoly would no longer make profits if the price it charges for its product is equal to the additional cost it incurred in producing that good.
One of the characteristics of oligopoly is the availability of
Few sellers
Few buyers
Many sellers
A single seller
Correct answer is A
Oligopoly is a state of limited competition, in which a market is shared by a small number of producers or sellers.
One of the major features of oligopoly is Few sellers. In an oligopoly setting, there are just few sellers who control all or most of the sales in the industry. The barrier to entry by new comers is very high.
The law of variable proportions is applicable only
In the long-run period
To large-scale enterprises
To small-scale enterprises
In the short-run period
Correct answer is D
The law of variable proportions states that as the quantity of one factor is increased, keeping the other factors fixed, the marginal product of that factor will eventually decline. It is applicable in the short-run period because there is at least, one fixed factor of production.
A firm will experience diseconomies of scale when
There are difficulties in coordinating production
There is shortage in labour supply
The size of market is small
There is an increase in the price of raw materials
Correct answer is A
Diseconomies of scale happen when a company or business grows so large that the costs per unit increase. One of the reasons for Diseconomies of scale Loss of direction and co-ordination of production activities.
It is harder to ensure that all workers are working for the same overall goal as the business grows. It is more difficult for managers to supervise their subordinates and check that everyone is working together effectively, as the spans of control have widened. A manager may be forced to delegate more tasks, which while often motivating for his subordinates, leaves the manager less in control.