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NECO SSCE Economics 2022 past questions and answers

This 2022 NECO SSCE 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 2022 set with instant marking.

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Sample NECO SSCE Economics 2022 questions

1. An economy records consumption of N480 billion, investment of N120 billion, government expenditure of N150 billion, exports of N90 billion and imports of N110 billion. Using the expenditure approach, what is its GDP?
  1. N710 billion
  2. N750 billion
  3. N730 billion
  4. N850 billion

Answer: C. N730 billion

GDP is C + I + G + (X - M), which gives 480 + 120 + 150 + (90 - 110) = N730 billion.

2. If nominal GDP is N600 billion and real GDP is N500 billion, what is the GDP deflator?
  1. 120
  2. 83.3
  3. 100
  4. 1,100

Answer: A. 120

The GDP deflator is nominal GDP divided by real GDP multiplied by 100, so it is 120.

3. Which situation is most likely to cause demand-pull inflation?
  1. A fall in household incomes while output remains constant
  2. A reduction in the money supply during a recession
  3. A rise in productivity that lowers unit costs
  4. Aggregate demand rising faster than the economy's capacity to produce

Answer: D. Aggregate demand rising faster than the economy's capacity to produce

Demand-pull inflation occurs when total spending grows beyond the available output of goods and services.

4. To reduce inflationary borrowing and spending, a central bank raises its policy interest rate. What is the most direct expected effect?
  1. Commercial bank lending becomes cheaper
  2. Borrowing becomes more expensive
  3. The supply of loanable funds becomes unlimited
  4. The exchange rate is fixed by law

Answer: B. Borrowing becomes more expensive

A higher policy rate generally raises borrowing costs and discourages credit-financed spending.

5. A commercial bank holds N20 million in cash reserves against deposits of N100 million. What is its cash reserve ratio?
  1. 5%
  2. 10%
  3. 20%
  4. 80%

Answer: C. 20%

The cash reserve ratio is reserves divided by deposits multiplied by 100, giving 20%.

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