MID TERM TEST FIRST TERM SS 2 ECONOMICS

First Term Mid Term Test 

   SUBJECT:  ECONOMICS   Class: SS2       Time:

1. Distribution of good and services is hindered by (a) good road and network (b) efficient storage facilities (c) too many middle men (d) adequate market information 
2. The amount of satisfaction obtained from the consumption of a commodity at a particular time is called (a) marginal utility (b) diminishing utility (c) total utility (d) average utility
3. A list of consumers want arranged in order of priority is known as (a) a budget (b) an opportunity cost (c) a scale of preference (d) choice
4. The #150.00 which Olu would have used to purchase a textbook was used to buy T-shirt. This implies that (a) Olu’s real cost is 15.00 naira (b) Olu’s opportunity cost is the T-shit he bought (c) Olu’s opportunity cost is the text book (d) Olu’s money cost is also the real cost
5. Price control refers to (a) the ways of making more goods available (b) a policy of ensuring stable price in the market (c) a general reduce level (d) effective working of the forces of demand and supply
6. The desire for goods without the ability to pay is called (a) choice (b) effective demand (c) joint demand (d) wants
7. Amount of goods offered to the market at respective prices and presented in a table is called (a) price schedule (b) supply schedule (c) scale of preference (d) demand schedule
8. One of the factors determining price elasticity of demand for a commodity is the (a) availability of close substitute (b) number of producers (c) government policy (d) price of other commodities 
9. If the elasticity of demand for a commodity is less than one, demand is (a) unitary elastic (b) inelastic (c) infinitely elastic (d) zero elastic
10. Wholesaler of ten criticized because they (a) help to break the bulk (b) finance producers (c) increase prices (d) provide after sale service
11. All the following factors will cause a change in demand except (a) the consumer’s income (b) the consumer’s taste (c) a change in population size (d) change in the color of the commodity
12. The theory of consumer behavior is based on all the following assumptions except that the (a) consumer is assumed irrational (b) consumer taste remain constant (c) consumer has budget constraint (d) consumer aims at maximizing his utility
13. One relationship between marginal utility and total utility is that when total utility is (a) rising, marginal utility is rising (b) falling marginal utility is negative (c) maximum, marginal utility is maximum (d) falling, marginal utility is rising
14. A shift in the supply curve to the right while demand curve remains the same will cause equilibrium price (a) and quantity to fall (b) and quantity to rise (c) to rise and quantity to fall (d) to fall and quantity to rise
15. The supply of rice in tons is given by the function Qs – 80 – 0.7p = 0 where Qs = quantity supplied P= price. In dollars $. Find Qs when P = $ 40 (a) 108 tons (b) 52 tons (c) .52tons (d) -108tons
16. The necessary condition for a firm to be in equilibrium is that marginal revenue is (a) greater than marginal cost (b) equal to marginal cost (c) less than average revenue (d) equal to average cost 
17. The opportunity cost of a worker going to the university is (a) tuition, fees, and books (b) boarding and lodging (c) transportation and entertainment
18. In a market economy, the problem of what goods to produced is solved primarily by (a) directives of the government (b) the pattern of consumer’s spending (c) producers of consumer goods (d) people producing what they want
19. The difference between demand and wants is in (a) desire for the commodity (b) significance of the commodity (c) ability to pay for the commodity (d) economic value of the commodity
20. A demand curve parallel to the Y-axis indicates (a) fairly elastic demand (b) perfectly elastic demand (c) perfectly inelastic demand (d) fairly inelastic demand
21. Which of the following is an example of derived demand? (a) textbook (b) labor (c) staple food (d) mobile phone
22. A rightward shift in the supply curve of a commodity is brought about by an increase in (a) the level of technology (b) the price of the commodity (c) cost of production (d) taxation
23. Effective supply is the total amount of a commodity (a) from a single producer (b) in the warehouse of producers (c) offered for sale at a market price (d) produced for the market
24. Price elasticity of supply can be influenced by the following factors EXCEPT (a) time period (b) cost of production (c) size of consumer’s income (d) nature of the  product 
25. Increase in the supply of a product can be caused by (a) change in tastes and fashion of consumers (b) increase in the incomes of consumers (c) a fall in the cost of production (d) increase in the price of a product
26. When a firm is enjoying internal economies of scale, its (a) total cost of production is increasing as output increases (b) average fixed cost is rising continuously (c) average cost of production decreases as output increases (d) average revenue and marginal revenue are decreasing
27. Which of the following can be added to a firm’s profit to obtain total revenue? (a) total variable cost (b) total fixed cost (c) marginal cost (d) total cost
28. The amount of money that a firm receives from the sale of its output is called (a) total profit (b) total revenue (c) total cost  (d) average revenue
29. The difference between the amount of money a consumer planned to pay for a commodity and the actual amount of money he paid is (a) commodity price (b) consumer surplus (c) marginal cost (d) producer surplus
30. The gap between demand and supply curves below the equilibrium price indicates (a) excess demand (b) excess supply (c) equilibrium quantity (d) equilibrium price.

SECTION B

Answer any one from the question in this section

Use the information to answer the questions

1. Calculate the value of P,Q,R and S
2. Given that the price of ice cream is $1.00 per unit at what level of consumption is the consumer in equilibrium? Explain your answer 
3. State the law of diminishing marginal utility.

1. Given that the price of commodity A in January is 5.00 and the price of commodity A in February is 7.00. quantity of A bought in January is 20kg and the quantity of A bought in February is 16kg

1. Calculate (a) co-efficient of price elasticity of demand (b) what type of elasticity it is and how?

SECTION C

Answer any two from this section

1. What is change in quantity demanded?

1. State three factors responsible for the change in demand

1. Define Utility 

1. Give the definition of the mean deviation and the standard deviation
2. Differentiate between normal goods and inferior goods
3. What are the effect of maximum price control on the equilibrium?