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WAEC WASSCE Economics 2016 past questions and answers

This 2016 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 2016 set with instant marking.

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Sample WAEC WASSCE Economics 2016 questions

1. Country P can produce either 12 units of rice or 6 units of cloth with its resources, while Country Q can produce either 8 units of rice or 8 units of cloth; which country has comparative advantage in rice production?
  1. Country P
  2. Country Q
  3. Both countries equally
  4. Neither country

Answer: A. Country P

P gives up 0.5 unit of cloth per unit of rice, whereas Q gives up 1 unit, so P has the lower opportunity cost in rice.

2. A country records a current-account deficit when, during a period, its current-account payments are
  1. equal to its current-account receipts
  2. greater than its current-account receipts
  3. less than its current-account receipts
  4. equal to its capital-account receipts

Answer: B. greater than its current-account receipts

A current-account deficit occurs when payments for goods, services, income and transfers exceed corresponding receipts.

3. If the naira depreciates and Nigerian export prices do not immediately change, Nigerian goods generally become
  1. more expensive to foreign buyers
  2. unavailable to domestic consumers
  3. cheaper to foreign buyers
  4. unrelated to the exchange rate

Answer: C. cheaper to foreign buyers

A depreciation reduces the foreign-currency price of exports when their naira prices remain unchanged.

4. A government-authorized reduction in the official value of a currency under a fixed exchange-rate system is called
  1. appreciation
  2. revaluation
  3. depreciation
  4. devaluation

Answer: D. devaluation

Devaluation is an official reduction in a currency's value under a fixed or managed exchange-rate arrangement.

5. Which feature distinguishes a customs union from a free-trade area?
  1. Members adopt a common external tariff
  2. Members use a single currency
  3. Members abolish all domestic taxes
  4. Members establish a common government

Answer: A. Members adopt a common external tariff

A customs union combines free trade among members with a common tariff on imports from non-members.

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