JAMB Economics Past Questions & Answers - Page 26

126.

The middlemen is responsible for

A.

Providing research facilities

B.

Purchasing raw materials

C.

Designing the product

D.

Breaking the bulk

Correct answer is D

The middlemen plays the role of an intermediary in a distribution or transaction chain who facilitates interaction between the involved parties. The middlemen are the whoselars and retailers who specialise in performing activities relating to the purchase and sale of goods in the process of their flow from producer to the final buyers

127.

A disadvantage of a jont-stock company is

A.

Unlimited liability

B.

Limited liability

C.

Lack of continuity when a shareholder dies

D.

Limited control in management by shareholders

Correct answer is D

The owners of the business (shareholders) have little or no say in the affairs of the business, while the people at the helm of affairs who are not the owners may not put in their best.

128.

Cooperative societies are formed mainly to

A.

Assist producers to maximize their profits

B.

Encourage thrift and credit among members

C.

Promote and maintain the welfare of members

D.

Break the monopolies of private companies

Correct answer is C

Cooperative societies are formed with the aim of helping their members. It is often a voluntary association of individuals who come together with the intention of work together and to promote their economic interest.

 

129.

The sufficient condition for a firm to be in equilibrium is that the

A.

Firm must show that it is profitable

B.

Marginal cost must be equal to average revenue

C.

Marginal revenue curve is above the average revenue curve

D.

Marginal cost curve cuts the marginal revenue curve from below

Correct answer is D

A firm is said to be in equilibrium when it satifies the following conditions:
- the first conditon for the equilibrium of the firm is that its profit should be maximum
- Marginal cost should be equal to marginal revenue
- Marginal cost must cut Marginal revenue from below

 

130.

A firm that closes down will still incur

A.

Variable cost

B.

Fixed cost

C.

Total cost

D.

Marginal cost

Correct answer is B

A firm that shut down will earn zero revenue and its variable cost of producion is also zero, so the firm's total cost of production is equal to its fixed cost. However, the firm will still incur fixed cost.