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JAMB UTME Economics 2013 past questions and answers

This 2013 JAMB UTME Economics set has 40 practice questions. Try these 5 free sample questions, tap a question to reveal the answer and explanation. Then practise the whole 2013 set with instant marking.

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Sample JAMB UTME Economics 2013 questions

1. Country K can produce either 12 units of cocoa or 6 units of textiles with the same resources. Country L can produce either 8 units of cocoa or 8 units of textiles. Which country has comparative advantage in textiles?
  1. Country L, because its opportunity cost of textiles is lower
  2. Country K, because it produces more cocoa
  3. Country K, because its opportunity cost of textiles is lower
  4. Neither country, because both produce textiles

Answer: A. Country L, because its opportunity cost of textiles is lower

K gives up 2 units of cocoa per textile while L gives up only 1, so L has the lower opportunity cost of textiles.

2. If a country imposes a tariff on imported footwear while other conditions remain unchanged, what is the most likely immediate effect in its domestic market?
  1. The supply of domestically made footwear disappears
  2. Imported footwear becomes more expensive to domestic buyers
  3. The quantity of imported footwear must rise
  4. The government loses all customs revenue

Answer: B. Imported footwear becomes more expensive to domestic buyers

A tariff is a tax on imports and normally raises their domestic selling price.

3. A government sets a quota limiting the number of foreign cars that may be imported each year. The quota directly controls the
  1. exchange rate of the domestic currency
  2. price paid by foreign car producers
  3. maximum quantity of cars imported
  4. amount of domestic tax on each car

Answer: C. maximum quantity of cars imported

An import quota is a quantitative restriction on the volume of a specified import.

4. A country devalues its currency to improve its trade balance. Under the usual Marshall-Lerner condition, this policy is most likely to work when
  1. imports and exports are perfectly price-inelastic
  2. the country stops all foreign borrowing
  3. domestic prices rise by the same proportion as the devaluation
  4. the sum of the absolute price elasticities of export and import demand exceeds one

Answer: D. the sum of the absolute price elasticities of export and import demand exceeds one

The Marshall-Lerner condition says devaluation tends to improve the trade balance when the sum of the two relevant absolute elasticities exceeds one.

5. Which item is recorded in the current account of a country's balance of payments?
  1. Receipts from exporting cocoa
  2. Purchase of shares in a foreign company
  3. A central bank's sale of foreign reserves
  4. A long-term loan granted to a foreign government

Answer: A. Receipts from exporting cocoa

Exports of goods are recorded as credits in the current account.

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