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WAEC WASSCE Economics 2011 past questions and answers

This 2011 WAEC WASSCE 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 2011 set with instant marking.

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Sample WAEC WASSCE Economics 2011 questions

1. Coastal can produce either 12 units of rice or 4 units of cloth with the same resources, while Highland can produce either 10 units of rice or 2 units of cloth. If each specializes according to comparative advantage, which trade pattern is most likely?
  1. Coastal exports rice and Highland exports cloth
  2. Both countries export rice
  3. Highland exports rice and Coastal exports cloth
  4. Neither country gains from trade

Answer: C. Highland exports rice and Coastal exports cloth

The opportunity cost of one unit of rice is lower in Highland (0.2 cloth) than in Coastal (about 0.33 cloth), so Highland has comparative advantage in rice.

2. If the naira depreciates against foreign currencies, other things being equal, which effect is most likely for Nigeria?
  1. Imports become dearer in naira and Nigerian exports may become cheaper to foreign buyers
  2. Imports become cheaper in naira and exports become dearer to foreign buyers
  3. The domestic price of every good immediately falls
  4. The naira's foreign purchasing power rises

Answer: A. Imports become dearer in naira and Nigerian exports may become cheaper to foreign buyers

A weaker naira buys fewer foreign-currency units, raising the naira cost of imports and potentially lowering foreign-currency prices of Nigerian exports.

3. A country has a current-account deficit but does not reduce its official foreign reserves. Which development could finance the deficit?
  1. An equal fall in export receipts
  2. A larger outflow of private capital
  3. A rise in payments for imported services
  4. A net inflow of foreign investment or borrowing

Answer: D. A net inflow of foreign investment or borrowing

A net financial inflow can provide foreign exchange to offset a current-account deficit without drawing down official reserves.

4. What is the most direct effect of imposing a tariff on an imported good, assuming the tariff is passed on to buyers?
  1. It eliminates all domestic production of the good
  2. It raises the good's domestic price and gives local producers some protection
  3. It increases the foreign supplier's production costs in its own country
  4. It guarantees a fall in government revenue

Answer: B. It raises the good's domestic price and gives local producers some protection

A tariff is a tax on imports that tends to raise their domestic price and can make competing local output more attractive.

5. Which function is most closely associated with the International Monetary Fund?
  1. Running the domestic commercial banks of member countries
  2. Setting world prices for agricultural exports
  3. Promoting international monetary cooperation and providing balance-of-payments support
  4. Collecting income tax on behalf of national governments

Answer: C. Promoting international monetary cooperation and providing balance-of-payments support

The IMF promotes monetary cooperation and may provide temporary financing to members facing external-payment difficulties.

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