Economics Exam Questions for SS1 Third Term

You’re welcome to our school exams series where we provide you with termly examination questions in different subjects. In today’s post, we will focus on Economics exam questions. We will cover Economics exam questions for SS1 Third term with answers. This means that we’ll be providing you with answers to the questions at the end. Also, you will get a few success tips on how to pass Economics examinations with flying colors. Remember to use the comments sections if you have questions, and don’t forget to join our Free Online Tutorial Classes on Facebook. (Like and Follow Page)

Introduction to Economics as a School Subject

Economics is a social science that studies how individuals, businesses, and governments make choices about the use of limited resources. As a school subject, it helps students understand basic concepts such as demand and supply, production, consumption, and distribution of goods and services.

Through Economics, students learn how money works in society, how prices are determined, and how various economic systems operate. It also prepares them to make informed decisions in real-life situations and understand national and global economic issues.

The subject is offered by students in Senior Secondary School as Economics.

Economics Exam Questions for SS1 Third Term

Economics Exam Questions for SS1 Third Term are divided into two sections:

• Section A
• Section B

The first section, namely, Section A is the objective test, and students are expected to attempt all questions in the section. Section B is the theory part, and students are expected to follow specific instruction and answer the required number of questions.

Note that what you have below are SS1 Economics Third Term Exam Past Questions made available to assist students in their revision for 3rd term examinations and also teachers in structuring standard examinations.

SECTION A: Objectives

Instruction: Answer all questions in this section by choosing from the options lettered A—D. Each question carries equal marks.

1. Absention from consumption enables capital to be produce. Such absention is called
A. saving
B. social wealth
C. business wealth
D. government wealth

2. The downward slope of the production possibility curve (PPC) illustrates
A. That it requires more resources than are possessed
B. That there is an opportunity cost involved
C. That resources are fixed in supply
D. The total product curve

3. Marginal cost is
A. the lowest cost of producing goods
B. the cost of production of the most recent firm in the industry
C. cost of producing an extra unit of output
D. cost of producing zero output

4. Average cost is
A. the total cost of production
B. the extra cost of producing an extra output
C. cost of producing a unit of production
D. overhead cost of production

5. Assuming that the total cost is N1,000, total variable cost is N2,500 and the output 100 units, find the average total cost of producing one unit.
A. N60         B. N45
C. N35         D. N30

6. Which of the following falls continually as output expands?
A. average fixed cost
B. marginal cost
C. average variable cost
D. average cost

7. Which of the following cost curves is “U” shape?
A. average cost
B. fixed cost
C. total cost
D. marginal cost

8. Marginal cost is calculated by which of these formulae?
A. MC = TC_n – TC_n-1
B. MC = ΔTC / ΔQ
C. MC = TFC/TVC
D. MC = TFC_n – TVC

9. The unit cost is otherwise known as
A. the marginal cost
B. the total cost
C. average cost
D. marginal cost

10. Average fixed cost is
A. total cost of production
B. total variable cost
C. total fixed cost
D. cost of producing one unit

11. The most common type of business in West Africa countries is
A. Joint stock company
B. sole proprietorships
C. partnerships
D. public enterprises

12. In which of the following economic systems is the consumer referred to as “The King”?
A. Planned economy
B. Mixed economy
C. Free market economy
D. Socialist economy

13. If you do not have to give up anything in order to get a particular thing, then its opportunity cost is
A. zero
B. not measurable
C. infinite
D. one

14. Capital earns income because
A. it is productive
B. it is expensive
C. it is scarce
D. it is cheap

15. Economics may be defined as
A. the study of money
B. the study of human and price
C. the study of production and distribution
D. the allocation of scarce resources.

16. In the study of economics, land, capital, labour and entrepreneur are referred to as factors of production. These factors produce commodities only if they are
A. profitable in production
B. purchased for production
C. combined for production
D. adequate for production

Production Possibilities [alternatives]

17. Based on the above production possibilities table, the real cost of a unit of food when alternative R is selected is
A. one unit of shelter
B. three units of shelter
C. six units of shelter
D. two units of shelter

18. The concept of economic efficiency primarily refers to
A. obtaining the maximum output from available resources
B. conservation of our resources
C. equal distribution of economic resources
D. producing without waste

19. As successive units of labour are added to a fixed factor of production while capital and technology remains constant, a point will be reached in the level of production when added units of labour will add less to output than previous units of labour. The concept is known as
A. the productivity of labour
B. the law of diminishing utility
C. the law of variable proportions
D. the concept of labour supply

20. The basic economic objective behind the production of goods and services in any economy is to
A. make profit
B. satisfy wants
C. be self-reliant
D. create job

21. A leftward shift in the production possibility frontier may be due to
A. use of inferior inputs
B. inefficiency
C. improvement in production techniques
D. changes in production cost

22. The table below shows the short run cost of a firm. What is the firms marginal cost for the third unit of output?

A. N350.00            B. N340.00
C. N360.00            D. N370.00

23. The advantages that accrue to a firm as the size of the firm increases are known as
A. external economies
B. internal returns to scale
C. internal economies
D. constant returns to scale

24. One of the advantages of large-scale production is that
A. high cost of management
B. consumers sacrifice their individual tastes
C. the firm can use labour-saving machinery
D. decision making is slow

25. Let TC = total cost, TVC = total variable cost, TFC = total fixed cost, ATC = average total cost, AVC= average variable cost, AFC= average fixed cost, Q= output. Which of the following is NOT true?
A. TC = TVC + TFC
B. ATC = AVC + AFC
C. AFC = TFC/Q
D. TVC = AVC/Q

26. Bisi needs a book costing N10.00 and a hat costing N10.00. If Bisi buys the book instead of the hat, the opportunity cost of his choice is the
A. cost of the book
B. cost of the hat
C. N10.00
D. cost of both items

27. Scale of preference means?
A. ranking of wants in order of priority
B. ranking of goods
C. selection of wants
D. ranking and selection of wants

28. Choice in economic life is necessitated by
A. the need to construct a scale of preference
B. the opportunity cost of consumption
C. unlimited wants
D. scarcity of economic resources

29. The residual of production which accrues to the ownership of land after all other expenses have been met is called
A. wages           B. rent
C. interest         D. profit

30. Which of the following is an important limiting factor in the application of division of labour?
A. market size
B. wage rate
C. raw materials
D. availability of land

31. Malthus observed in his theory that population was growing
A. at a regular rate
B. in arithmetical progression
C. in geometrical progression
D. in mathematical progression

32. At optimum population level, a country has its
A. Maximum population
B. ageing population
C. highest birth rate
D. highest output per head

33. Data presented in tables are usually arranged in
A. charts and tables
B. rows and columns
C. graphs and rows
D. maps and pie charts

34. Which of the following is the most liquid asset?
A. bank notes
B. silver
C. bank deposit
D. cheques

35. The reward for entrepreneurship is
A. rent              B. wages
C. interest        D. profit

36. The dispersal of people in a country is called
A. mobility of people
B. geographical distribution
C. occupational distribution
D. state distribution

37. The demand for a commodity not directly for immediate consumption but for the production of another commodity is
A. competitive demand
B. derived demand
C. composed demand
D. joint demand

38. Which of the following is a luxury item?
A. petrol           B. text book
C. pencil           D. gold

39. Which of the following business units can issue shares?
A. sole trader
B. private limited company
C. central bank
D. supermarket

40. Short-term loans can be sourced from
A. the central bank
B. development bank
C. mortgage banks
D. commercial banks

41. Which of the following is an advantage of division of labour?
A. production of specialized goods
B. employment of experts
C. monotony of work
D. greater use of machinery

42. One of the functions of money is
A. double coincidence of want
B. unit of account
C. indivisibility
D. buy things

43. Which of the following is a function of the retailer?
A. provision of storage facilities
B. members of the society
C. stocking variety of goods
D. advertisement of goods

44. Census of population is usually conducted every
A. 20 years          B. 15 years
C. 10 years          D. 7 years

45. The most unique quality of money is its
A. relative scarcity
B. divisibility
C. durability
D. general acceptability

46. Absenteeism from consumption which enables capital to be produced is called
A. savings
B. production
C. accumulation
D. opportunity cost

47. Shares and stocks can be bought in the
A. commodity market
B. stock exchange
C. money market
D. open market

48. Commercial banks settle their inter-bank indebtedness through
A. merchant banks
B. central bank
C. development bank
D. stock exchange

49. Which of the following banks grant credit facilities to individuals wishing to build houses
A. Central Bank
B. Industrial Banks
C. Agricultural Bank
D. Federal Mortgage

50. The primary objective of the Nigerian Industrial Development Bank (NIDB) in the provision of loans to
A. Farmers
B. Manufacturers
C. Estate agents
D. Transportation

51. The difference between the highest and lowest in a set of data is the
A. range           B. median
C. variance       D. mode

52. Which of the following is a problem of trade by barter?
A. Exchange rate determination
B. Hoarding
C. How to produce
D. What to produce

53. Which of the following is a liability of a commercial bank
A. Deposits
B. Money at cell
C. loans to customers
D. Overdrafts

54. The economic goals of public corporation is to
A. Maximize profit
B. Expand assets
C. Minimize costs
D. provide essential services

55. West African Countries experience rapid population growth due to
A. existence of birth control clinics
B. early marriage
C. adequate sex education in schools
D. late marriage

56. Division of labour leads to
A. improved craftsmanship
B. the production of standardized goods
C. increase in the cost of goods
D. trade by barter

57. The distribution of goods is said to be completed when it reaches the
A. wholesalers      B. consumers
C. retailers            D. manufacturers

58. Division of labour is limited by
A. the size of the market
B. the productivity of capital
C. cost of production
D. the factors of production

59. Natural growth rate in
A. birth rate less death rate
B. death rate less migration
C. death rate plus birth rate
D. birth rate plus migration

60. Demand for inferior good is an example of
A. expansion of demand
B. contraction of demand
C. individual demand
D. abnormal demand

61. The value of money is best determined by
A. input-output ratio
B. the purchasing power
C. the importance people attached to it
D. economies of scale

62. Acceptability, durability, homogeneity are all attributes of good
A. markets         B. money
C. banks            D. government

63. The lender of last resort in the banking system is the
A. industrial bank
B. mortgage bank
C. commercial bank
D. central bank

64. When a worker changes from one type of job to another, it is called
A. Geographical mobility labour
B. occupational mobility of labour
C. immobility of labour
D. rural-urban migration

65. A group of firms producing similar commodities for the same market constitute
A. a cartel
B. an industry
C. a co-operative
D. wholesalers

66. The desire for goods without the ability to pay is called
A. choice
B. effective demand
C. joint demand
D. wants

67. 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

68. Wholesalers are often criticized because they
A. help to break the bulk
B. finance producers
C. increase prices
D. provide after-sale services

69. Malthus observe in his theory that population was growing
A. at a regular rate
B. in arithmetical progression
C. in geometrical progression
D. in mathematical progression

70. Which of the following is not a source of raising funds for a public limited liability company in West Africa?
A. Bank loans
B. Issue of shares
C. Issue of debenture
D. sales of bonds

SECTION B: Essay

INSTRUCTION – Answer only four (4) questions in this section.

1a. Define basic Economic problems of the society.
b. State 4 basic Economic problems of the society.

2a. Define Population.
b. Explain the following concept
i. Population census
ii. Under population
iii. Over population
iv. Optimum population

3a. Explain Financial Institution
b. Mention 2 types of financial institution.
c. Mention 4 commodities that was used as money in Historical development of money.

4. Explain 5 characteristics of money.
Mention and explain 4 process of distribution.

5a. Define Agriculture.
b. Mention and explain 3 components of Agriculture.
c. Explain 4 importance of Agriculture in Nigeria Economy.

Answers to Economics Exam Questions for SS1 Third Term

Answers to Section A (Objective Test)

The following table gives the correct answers to the objective section of Economics exam questions for SS1 Third term. If you are using a mobile device, hold the table and scroll to the right or left for a complete view.

So here you have the answers to the objective section of Economics Exam Questions for SS1 Third term. Use the comments section to let me know if you have any questions you would want me to clarify or discuss further.

Answers to Section B (Theory)

Answers to Question 1.

a. The basic economic problems of the society refer to the fundamental issues that arise because resources are scarce while human wants are unlimited. These problems revolve around how to allocate limited resources efficiently to satisfy various needs and wants.

b. Four basic economic problems of the society are:

• What to produce
• How to produce
• For whom to produce
• Efficiency in the use of resources

Answers to Question 2.

a. Population is defined as the total number of people living in a particular country or area at a specific time.

b. Explanation of the following concepts:

• i. Population census: This is the official headcount or survey of a country’s population, usually conducted periodically to obtain demographic data.
• ii. Under population: This occurs when the population size is too small to fully utilize the available resources of a country.
• iii. Over population: This happens when the population is too large compared to the available resources, leading to problems like unemployment and poverty.
• iv. Optimum population: This is the ideal population size that allows maximum utilization of resources to achieve the highest standard of living.

Answers to Question 3.

a. A financial institution is an organization that provides financial services to individuals and businesses, including saving, lending, investing, and currency exchange.

b. Two types of financial institutions are:

• Commercial banks
• Central banks

c. Four commodities that were used as money in the historical development of money are:

• Salt
• Cowries
• Gold
• Animal skins

Answers to Question 4.

Five characteristics of money:

• Acceptability: Money must be widely accepted in exchange for goods and services.
• Durability: It should last long and not wear out quickly.
• Divisibility: Money should be easily divided into smaller units.
• Portability: It must be easy to carry around.
• Stability in value: Its value should not fluctuate wildly over time.

Four processes of distribution:

• Transportation: Moving goods from producers to consumers.
• Warehousing: Storing goods until they are needed.
• Advertising: Creating awareness and demand for the product.
• Retailing: Selling goods to the final consumers.

Answers to Question 5.

a. Agriculture is the science and practice of cultivating the land, rearing animals, and producing crops for food and raw materials.

b. Three components of agriculture:

• Crop production: Growing food and cash crops.
• Animal husbandry: Rearing animals for meat, milk, and other products.
• Forestry: Cultivation and management of forests and forest products.

c. Four importance of agriculture in the Nigerian economy:

• Employment: It provides jobs for a large percentage of the population.
• Food supply: It ensures the availability of food for the nation.
• Raw materials: Agriculture supplies raw materials to industries.
• Revenue generation: The government earns income from export of agricultural products.

Read Also: WAEC recommended textbooks for Economics

How to Pass Economics Exam Questions for SS1 Third Term

Passing your Economics exam questions for SS1 Third term requires a combination of preparation, understanding, and strategy. Here are actionable tips to help you excel:

• Understand Key Concepts: Focus on understanding the basic economic problems, population, money, agriculture, and financial institutions. Don’t just cram definitions—know what they mean and how they relate to real-life situations.
• Study Past Questions: Practice with past exam questions to get used to the exam format and commonly repeated topics. This helps you prepare for what to expect in the exam hall.
• Revise Regularly: Make a study timetable and revise frequently. Consistent revision helps you retain important points and reduces last-minute stress.
• Pay Attention in Class: Listen attentively during Economics lessons and ask questions when you’re confused. Your teacher’s explanations can make difficult topics easier to understand.
• Write Notes in Your Own Words: Writing your notes helps you remember better. It also gives you something simple and personal to revise with.
• Use Flashcards for Definitions: Economics has a lot of definitions and terms. Use flashcards to test yourself on them regularly.
• Be Exam Ready: Get enough sleep before your exam, arrive early, read instructions carefully, and plan your time well during the exam.

With hard work, focus, and proper preparation, you will pass your Economics exam with ease.

It’s a wrap!

If you need more clarification on SS1 Third Term Questions on Economics, you can use the comments box below. We’ll be there to answer you asap.

Best wishes.