Economics, 2020, WASSCE/WAEC MAY/JUNE, Exam, Paper 1 | Objectives

Paper Info

Year :

2020

Title :

Economics

Exam :

WASSCE/WAEC MAY/JUNE

Paper 1 | Objectives

31 - 40 of 49 Questions

#	Question	Ans
31.	Which of the following are intermediate products? A. Cement and steel B. Furniture and shirt C. Handkerchief and shoe D. Table and door Show Content Detailed Solution Intermediate goods are products that are used in the production process to make other goods or further production. Cement and steel from option A above are examples of intermediate goods, as they are used in building and construction.	A
32.	How is NNP at factor cost derived from GNP at market prices? A. GNP - Depreciation + Indirect taxes + Subsidies B. GNP Depreciation - Indirect taxes + Subsidies C. GNP + Depreciation Indirect taxes - Subsidies D. GNP+ Depreciation- Indirect taxes + Subsidies	D
33.	Inflation may occur if A. rate of productivity is higher than the wage rate B. prices fluctuate during a particular season of the year C. wage increase is granted without an increase in productivity D. the government embarks on restrictive monetary policies Show Content Detailed Solution If salaries and wages are increased without a corresponding increase in production, it will lead to inflation. This is so because they will be excess money chasing few the goods that are available in the market.	C
34.	Money would cease to be a good store of value when A. prices of goods and services are falling slowly B. there is a high level of unemployment C. prices of goods and services are rising rapidly D. prices of go0ds and services are rising slowing Show Content Detailed Solution Money is considered a store of value, where it can be used as a means of saving and allocating capital. Where the value of goods and services is on the rise, the purchasing power of money drops. With this, the value of the money that was stored years back will no longer have the same value due to the change in the prices of commodities.	C
35.	Which of the following factors may lead to the underestimation of national income figures? A. Availability of skilled statisticians B. High volume of exports C. Emigration of skilled workers to foreign countries D. Subsistence production	C
36.	Governments in West Africa can curtail inflation by A. purchasing securities in the open market B. selling securities in the open market C. encouraging importation of goods from all countries D. encouraging banks to lend for Show Content Detailed Solution Inflation is simply when excess money is used in buying few goods. This could be as a result of high wages with no matching productivity. When people have excess money available for spending, their purchasing power will be high, as they will be willing to pay any amount to get goods (which are in limited supply) in this case. The government can curtail inflation by raising the level of output/production and taking out the excess money in circulation in the economy. This is done through the sale of securities at high-interest rates. When people realize that, the government is offering to sell securities and the interest paid on the securities is high, they will be willing to buy from the government. With this, they are less money av	B
37.	The central bank Can reduce the ability of commercial banks to give out loans by A. raising the bank rates B. reducing special deposits C. reducing the liquidity ratio D. issuing more currency Show Content Detailed Solution One way the central bank can reduce the rate at which banks lend money is by raising the interest rates bank charge on loans, this will discourage people from borrowing from commercial banks.	A
38.	Tools of monetary policy do not include A. open market operations B. reserve requirement C. bank rate D. tax and public expenditure Show Content Detailed Solution Central banks have four main monetary policy tools: the reserve requirement, open market operations, the discount rate, and interest on reserves.	D
39.	During inflation, the appropriate fiscal measure to adopt is to A. increase indirect taxes B. increase direct taxes C. reduce personal income tax D. increase government expenditure Show Content Detailed Solution In fiscal policy, the government controls inflation either by reducing private spending or by decreasing government expenditure, or using both. It reduces private spending by increasing taxes on private businesses. When private spending is more, the government reduces its expenditure to control inflation. The tax system should provide larger incentives to those who save, invest, and produce more.	B
40.	Mr. X and Mrs. Y pay $500.00 and $1,400.00 as taxes on their earning of S5,000.00 and $7,000.00 respectively. The system of taxation employed is A. specific tax B. proportional tax C. regressive tax D. progressive tax Show Content Detailed Solution A progressive tax is a type of tax in which the tax rate increases as the taxable amount increases. This type of taxes imposes a greater percentage of taxation on higher income levels	D

31.	Which of the following are intermediate products? A. Cement and steel B. Furniture and shirt C. Handkerchief and shoe D. Table and door Show Content Detailed Solution Intermediate goods are products that are used in the production process to make other goods or further production. Cement and steel from option A above are examples of intermediate goods, as they are used in building and construction.	A
32.	How is NNP at factor cost derived from GNP at market prices? A. GNP - Depreciation + Indirect taxes + Subsidies B. GNP Depreciation - Indirect taxes + Subsidies C. GNP + Depreciation Indirect taxes - Subsidies D. GNP+ Depreciation- Indirect taxes + Subsidies	D
33.	Inflation may occur if A. rate of productivity is higher than the wage rate B. prices fluctuate during a particular season of the year C. wage increase is granted without an increase in productivity D. the government embarks on restrictive monetary policies Show Content Detailed Solution If salaries and wages are increased without a corresponding increase in production, it will lead to inflation. This is so because they will be excess money chasing few the goods that are available in the market.	C
34.	Money would cease to be a good store of value when A. prices of goods and services are falling slowly B. there is a high level of unemployment C. prices of goods and services are rising rapidly D. prices of go0ds and services are rising slowing Show Content Detailed Solution Money is considered a store of value, where it can be used as a means of saving and allocating capital. Where the value of goods and services is on the rise, the purchasing power of money drops. With this, the value of the money that was stored years back will no longer have the same value due to the change in the prices of commodities.	C
35.	Which of the following factors may lead to the underestimation of national income figures? A. Availability of skilled statisticians B. High volume of exports C. Emigration of skilled workers to foreign countries D. Subsistence production	C

36.	Governments in West Africa can curtail inflation by A. purchasing securities in the open market B. selling securities in the open market C. encouraging importation of goods from all countries D. encouraging banks to lend for Show Content Detailed Solution Inflation is simply when excess money is used in buying few goods. This could be as a result of high wages with no matching productivity. When people have excess money available for spending, their purchasing power will be high, as they will be willing to pay any amount to get goods (which are in limited supply) in this case. The government can curtail inflation by raising the level of output/production and taking out the excess money in circulation in the economy. This is done through the sale of securities at high-interest rates. When people realize that, the government is offering to sell securities and the interest paid on the securities is high, they will be willing to buy from the government. With this, they are less money av	B
37.	The central bank Can reduce the ability of commercial banks to give out loans by A. raising the bank rates B. reducing special deposits C. reducing the liquidity ratio D. issuing more currency Show Content Detailed Solution One way the central bank can reduce the rate at which banks lend money is by raising the interest rates bank charge on loans, this will discourage people from borrowing from commercial banks.	A
38.	Tools of monetary policy do not include A. open market operations B. reserve requirement C. bank rate D. tax and public expenditure Show Content Detailed Solution Central banks have four main monetary policy tools: the reserve requirement, open market operations, the discount rate, and interest on reserves.	D
39.	During inflation, the appropriate fiscal measure to adopt is to A. increase indirect taxes B. increase direct taxes C. reduce personal income tax D. increase government expenditure Show Content Detailed Solution In fiscal policy, the government controls inflation either by reducing private spending or by decreasing government expenditure, or using both. It reduces private spending by increasing taxes on private businesses. When private spending is more, the government reduces its expenditure to control inflation. The tax system should provide larger incentives to those who save, invest, and produce more.	B
40.	Mr. X and Mrs. Y pay $500.00 and $1,400.00 as taxes on their earning of S5,000.00 and $7,000.00 respectively. The system of taxation employed is A. specific tax B. proportional tax C. regressive tax D. progressive tax Show Content Detailed Solution A progressive tax is a type of tax in which the tax rate increases as the taxable amount increases. This type of taxes imposes a greater percentage of taxation on higher income levels	D