NECO ECONOMICS ANSWERS 2020

ECONOMICS OBJ
1-10: DCABDDCAAA
11-20: EEEABDBABD
21-30: BBCEAEABEE
31-40: EDDEDDAAAC
41-50: CCACACAEEA
51-60: DEDEEEBCED
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THEORY/ESSAY PART

Answer five questions in all, one from Section A and four from Section B
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SECTION A
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(1a)
Qd= 40-4p

TABULATE
P: 10, 8, 6, 4, 2, 1
Qd: 0, 8,16, 24, 32, 36

When price = 10
Qd= 40-4(10)=0

When price= 8
Qd= 40-4(8)= 8

When price= 6
Qd= 40-4(6)= 16

When price= 4
Qd= 40-4(4) = 24

When price= 2
Qd= 40-4(2)= 32

When price= 1
Qd= 40-4(1)= 36

(1b)

(1c) The slop of the curve indicate that the quantity demanded has negative correlation with price. The higher the price the lower the quantity demanded and vice versa

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(2a)
MR = ∆inTR/∆inQ
TR2 – TR1/Q2 – Q1

At Q = 2,
MR = 30-20/2-1 = ₦10

At Q = 3
MR = 60-30/3-2 = ₦30

At Q = 4
MR = 80-60/4-3 = ₦20

At Q = 5
MR = 120-80/5-4 = ₦40

At Q = 6
MR = 150-120/6-5 = ₦30

AR = TR/Q

At Q = 1
AR = 20/1 = ₦20

At Q = 2
AR = 30/2 = ₦15

At Q = 3
AR = 60/3 = ₦20

At Q = 4
AR = 80/4 = ₦20

At Q = 5
AR = 120/5 = ₦24

At Q = 6
AR = 150/6 = ₦25

MC = TC2 – TC1/Q2 – Q1

At Q = 1
MC = 40 – 0/1 – 0 = ₦40

At Q = 2
MC = 50 – 40/2 – 1 = ₦10

At Q = 3
MC = 60 – 50/3 – 2 = ₦10

At Q = 4
MC = 80 – 60/4 – 3 = ₦20

At Q = 5
MC = 110 – 80/5 – 4 = ₦30

At Q = 6
MC = 120 – 110/6 – 5 = ₦10

(2b)
The conditions necessary for profit maximization are:
(i) MC = MR
(ii) When MC is cutting MR from below at equilibrium point.

*Draw the diagram
From the above diagram, point “X” is the point of profit maximization.
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SECTION B
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(3i) Frequency distribution table refers to the table that shows the items and the number of times they occur in a given distribution. We have grouped Frequency distribution table and ungrouped frequency distribution table. Eg of grouped distribution table is below

TABULATE
X: 2 | 3 | 5 | 6 | 8
F: 1 | 2 | 4 | 8 | 2

The table above shows the shows the score sheet of (17) students from maths test.

(3ii) Standard deviation is the square of variation.
For example
SD= ∑f(x−x)²/∑f

(3iii) Range: This refers to the highest number of items and the lowest in a given set distribution e.g from the above table
The Range= 8-2= 6

​(3iv) Table: This can be defined as the logical and systematic arrangements of data in rolls and columns . Eg Below are numbers of students and their scores in economics test.

​Number one f students: 2 | 6 | 8 | 9

Marks: 4 | 5 | 2 | 6

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(Number 4)

(4a)
Labour can be defined as all human efforts of any kind, either skilled or unskilled, mental or manual, directed towards the production of goods and services. The rewards for labour as a factor of production comes in form of wages and salaries.

(4b)
(Choose Any four)
(i) Education and training : The level of education and training received by a worker will go a long way towards increasing the efficiency of labor. A well educated or well trained worker is in position to increase efficiency in his work.

(ii) Level of commitment and attitude: The level of commitment and attitude of a worker can affect the efficiency of labour. When a worker is highly committed to his job, this will result in efficiency of labour.

(iii) Efficient management : When efficient management is in place in any organization, it will go a long way towards improving efficiency of labour.

(iv) Efficiency of other factors of production: The efficiency of other factors of production like land, capital and entrepreneur when combined with efficient labour will increase productivity.

(v) Weather condition: The physical or weather conditions in a work place can affect the efficiency of labour. Hot weather lowers efficiency of labour while Cool weather or environment increases efficiency of labour.
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(Number 5)

(Choose any five)
(i) Tax: Taxes include both direct and indirect taxes. Government generates income or revenue by taxing individuals and corporate bodies

(ii) Grant and aids: Government can receive grants and aids as revenue from wealthy or developed countries.

(iii) Rent and rates: Earning from water, properties, housing etc owned by the government are sources of income to the government

(iv) Licence: Government can also generate revenue through licences eg drivers licence

(v) Savings: Government can also generate revenue through savings, especially when country has budget surplus

(vi) Earning from government investment: Government can also earn income or generate revenue from government owned business enterprises or from joint ventures
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Number 6

(a)Overpopulation is defined as a situation where a country has more people than its physical and human resources can support with adequate living standards.

(b)
i) Insufficient food: As a result of the high influx of people into an area, there will not be sufficient food for people to cater for the high population which leads to food shortage.
ii) Traffic Congestion: Many people travel on the road at the same time which leads to traffic congestion in most of the time.
iii) Unemployment: Area of high population density usually do not have enough jobs for the ever increasing influx of people.
iv) Pressure on Natural resources: Natural resources like fertile farmlands and minerals become over exploited where rug there is high population growth in an area.
v) Inadequate health services: As a result of high population density, there is always inadequate health services to meet up or match the over increasing population.
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9a)
Market can be defined as a place/set up where two or more parties engage in exchange of goods, services and information is called a market. Ideally a market is a place where two or more parties are involved in buying and selling.

(b)
1. Large Number of Buyers and Sellers:
There are large number of firms but not as large as under perfect competition.

3. Less Mobility:
Under monopolistic competition both the factors of production as well as goods and services are not perfectly mobile.

3. More Elastic Demand:
Under monopolistic competition, demand curve is more elastic. In order to sell more, the firms must reduce its price.

4. Selling Cost:
Another feature of the monopolistic competition is that every firm tries to promote its product by different types of expenditures.

5. Lack of Perfect Knowledge:
The buyers and sellers do not have perfect knowledge of the market. There are innumerable products each being a close substitute of the other.
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7a)
(i) Epileptic Electric Power Supply. Lack of regular electric power supply is the biggest cause of unemployment in Nigeria. …

(ii) Lack of quality education:
Most employers believe that Nigerian graduates are unemployable. This is the result of the educational program which usually include theories and a lack of practical use of knowledge.

(iii) High and Rapid Population Growth:
One of the major factors responsible for the high level of unemployment in Nigeria is the rapid growth in population. There has been an increase in the growth of the labor forces along with the inadequate supply of jobs. The rapid population growth has been coupled with rural-urban migration. This has increased the population in cities thereby raising the level of joblessness.

(iv) Unstable and corrupt political environment:
Another key problem is poor leadership and high level of corruption in Nigeria. The failure of the government to perform their constitutional duties has resulted in the high level of unemployment.

(v) Lack of infrastructure:
Lack of good roads, steady and sustainable power supply has made the economy hostile to investors. The lack of infrastructure has led to the high cost of production. The absence of investors influences the number of available jobs. The operating companies also use fewer people because of the high cost of production
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8a)
A retailer: is a person or business that you purchase goods from. Retailers typically don’t manufacture their own items.

8b)
(i) They provide valuable information and feedback to producers about consumer behavior, changing tastes and fashions, upcoming rival businesses, etc.

(ii) They enable manufacturers to concentrate on the primary function of production by handling the ancillary functions of warehousing, distribution, advertising, insurance, etc. They promote the goods to the consumers on behalf of the producers.

(iii) Middlemen like banks and other financial institutions render financial services to manufacturers.

(iv) They make the goods and services available to consumers at the right place, at the right time, and in the right quantity.

(v) Buyers and sellers are often unwilling to assume the market risk for fear of a possible loss. It is the middlemen in the process chain who assume the risks of theft, perishability, and other potential hazards.
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(9a)
market is a place where buyers and sellers can meet to facilitate the exchange or transaction of goods and services. In Other examples include the black market, auction markets, and financial markets. In other words Markets establish the prices of goods and services that are determined by supply and demand.

(9b)
(i)It’s a type of competition between others in the industry. This means more than one company is selling a similar product and competing in that market.

(ii)Everyone offers a similar product, but that product can’t be completely substituted. In other words, while other companies may sell goat’s milk soap, none of them are exactly like Betty’s soap because they do not contain all of the exact same ingredients.

(iii)All companies can enter or leave the industry when they want to. This means companies can enter in and sell goat’s milk soap when they think they can make money doing so. And, they can leave if they think there is no longer a market for the product.

(iv)Every company makes their own decisions about their products. So, they decide what price to sell their soap at and how many to make and sell. Because there’s such a demand for goat’s milk soap, Betty keeps a steady supply. And finally…

(v)There is product differentiation. Product differentiation means that companies try to distinguish or differentiate their products from others in the market so that their product is more enticing to customers.

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Number 11

(a) Nationalization is a deliberate policy by which government take over the control and ownership of private enterprises due to economic, political, social or strategic reasons.

Advantages
(b)
i.) Increase in standards of living
Standard of living of people will increase through participation in business enterprise.
ii) Provision of employment opportunities
It creates employment opportunities for the indigenes.
iii) Acceleration of industrial development.
It leads to the promotion and acceleration of industrial development.

Disadvantages
i) It can lead to capital flight.
It can leads to capital flight as foreign investors will be forced to relocate to other countries.
ii) Rich people can hijack economy.
Few rich people can use their financial wealth to buy and take over all such business enterprises.
iii) Discouragement of foreign investment.
Indigenisation can discourage foreign investment in a country
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12a)
balance of payments (BOP) is a statement of all transactions made between entities in one country and the rest of the world over a defined period of time, such as a quarter or a year.

12b)
(i) Expenditure-Reducing Policies:
The important way to reduce imports and thereby reduce deficit in balance of payments is to adopt monetary and fiscal policies that aim at reducing aggregate expenditure in the economy.

(ii) Trade Policy Measures: Expanding, Exports and Restraining Imports:
Trade policy measures to improve the balance of payments refer to the measures adopted to promote exports and reduce imports. Exports may be encouraged by reducing or abolishing export duties and lowering the interest rate on credit used for financing exports. Exports are also encour­aged by granting subsidies to manufacturers and exporters.

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COMPLETED

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NECO ECONOMICS (2020/2021)

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