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JAMB Economics Practice Questions & Explanations

Try 20 of 198+ JAMB Economics questions as a free quiz — select your answers, submit, and see your score with a full explanation for every one.

  1. 1.
    Economics is primarily concerned with the study of how people
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    Economics studies how individuals and societies use limited resources to satisfy their unlimited wants.
  2. 2.
    The basic economic problem facing every society is
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    Resources are limited while human wants are unlimited. This problem is known as scarcity.
  3. 3.
    Opportunity cost is best defined as
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    Opportunity cost is what must be sacrificed when a choice is made among alternatives.
  4. 4.
    A scale of preference refers to
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    A scale of preference ranks wants in order of priority so that limited resources can be used effectively.
  5. 5.
    Which of the following is an example of a free good?
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    A free good is available in abundance and does not require payment. Air is a common example.
  6. 6.
    The need to choose among competing wants arises because
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    Since resources are scarce, individuals and societies must make choices about their use.
  7. 7.
    Which of the following is NOT a factor of production?
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    The main factors of production are land, labour, capital, and entrepreneurship. Money itself is not a factor of production.
  8. 8.
    The reward paid to labour is known as
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    Labour receives wages or salaries as compensation for work done.
  9. 9.
    The reward for the use of land is
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    Land earns rent because it is a natural resource used in production.
  10. 10.
    The reward earned by an entrepreneur for bearing risks is
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    Entrepreneurs organize production and bear risks; their reward is profit.
  11. 11.
    A Production Possibility Curve (PPC) illustrates
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    The PPC shows the maximum combinations of two goods that can be produced with given resources and technology.
  12. 12.
    A point inside the Production Possibility Curve indicates
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    A point inside the PPC means some resources are idle or not being fully utilized.
  13. 13.
    Which economic question addresses resource allocation?
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    Every economy must decide what goods and services to produce from limited resources.
  14. 14.
    When a student chooses to study instead of watching a movie, the opportunity cost is
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    The opportunity cost is the next best alternative sacrificed, which is watching the movie.
  15. 15.
    Capital as a factor of production refers to
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    In economics, capital means man-made assets used to produce other goods and services.
  16. 16.
    A society can reduce the problem of scarcity by
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    Although scarcity cannot be completely eliminated, increasing resources and productivity can reduce its effects.
  17. 17.
    Which of the following best illustrates economic choice?
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    Economic choice occurs when a person selects one option and gives up others because resources are limited.
  18. 18.
    The concept of scarcity implies that
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    Scarcity exists because available resources cannot satisfy all human wants at the same time.
  19. 19.
    If an economy moves from a point inside its PPC to a point on the PPC, it indicates
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    Moving to a point on the PPC shows that resources are being used more efficiently.
  20. 20.
    An entrepreneur differs from other factors of production because the entrepreneur
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    The entrepreneur coordinates the other factors of production, makes business decisions, and bears the risks involved.
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