WAEC Economics Question & Answers

(6a)
Money is an economic unit that functions as a generally recognized medium of exchange for transactional purposes in an economy. … Money can be: market-determined, officially issued legal tender or fiat moneys, money substitutes and fiduciary media, and electronic cryptocurrencies.

(6bi)
value of money, then, is the quantity of goods in general that will be exchanged for one unit of money. The value of money is its purchasing power, i.e., the quantity of goods and services it can purchase.

(6bii)
demand for money is the desired holding of financial assets in the form of money. In othet words that is, cash or bank deposits rather than investments.

(6c)
(i)The price of the good or service.
(ii)The income of buyers.
(iii)The prices of related goods or services—either complementary and purchased along with a particular item, or substitutes and bought instead of a product.
(iv)The tastes or preferences of consumers will drive demand.

8a:Public debt is the total amount, including total liabilities, borrowed by the government to meet its development budget. It has to be paid from the Consolidated Fund of India. The term is also used to refer to overall liabilities of central and state governments, but the Union government clearly distinguishes its debt liabilities from the states.

8a:Public debt is the total amount, including total liabilities, borrowed by the government to meet its development budget. It has to be paid from the Consolidated Fund of India. The term is also used to refer to overall liabilities of central and state governments, but the Union government clearly distinguishes its debt liabilities from the states.

Answers to questions 3 and 6

 

3a
Consumer goods are products bought for consumption by the average consumer. Alternatively called final goods, consumer goods are the end result of production and manufacturing and are what a consumer will see stocked on the store shelf. Clothing, food, and jewelry are all examples of consumer goods.

3bi
Fixed capital is the portion of total capital outlay of a business invested in physical assets such as factories, vehicles, and machinery that stay in the business almost permanently, or, more technically, for more than one accounting period

3bii

Social capital basically comprises the value of social relationships and networks that complement the economic capital for economic growth of an organization

Examples of social capital include when someone opens a door for someone, returns a lost item to a stranger, gives someone directions, loans something without a contract, and any other beneficial interaction between people, even if they don’t know each other.

Circulating capital is also called working capital or revolving capital

(5ai) A joint venture is a business entity created by two or more parties, generally characterized by shared ownership, shared returns and risks, and shared governance.

(5aii) (I) ease of establishment
(ii) lower cost

 

 

(6a)
Money is an economic unit that functions as a generally recognized medium of exchange for transactional purposes in an economy. … Money can be: market-determined, officially issued legal tender or fiat moneys, money substitutes and fiduciary media, and electronic cryptocurrencies.

(6bi)
value of money, then, is the quantity of goods in general that will be exchanged for one unit of money. The value of money is its purchasing power, i.e., the quantity of goods and services it can purchase.

(6bii)
demand for money is the desired holding of financial assets in the form of money. In othet words that is, cash or bank deposits rather than investments.

(6c)
(i)The price of the good or service.
(ii)The income of buyers.
(iii)The prices of related goods or services—either complementary and purchased along with a particular item, or substitutes and bought instead of a product.
(iv)The tastes or preferences of consumers will drive demand.

8a:Public debt is the total amount, including total liabilities, borrowed by the government to meet its development budget. It has to be paid from the Consolidated Fund of India. The term is also used to refer to overall liabilities of central and state governments, but the Union government clearly distinguishes its debt liabilities from the states.
8b)

i) Automatic fiscal stabilisers. In a recession, government tax revenues fall (e.g. people earn less so pay less income tax). Also, the government have to spend more on unemployment benefits. Therefore, in an economic downturn, borrowing rises. To eliminate borrowing in a recession would make the recession worse and increase inequality. If the government couldn’t borrow in a recession, the unemployed may not get any benefits and have no income. Also, higher taxes and lower spending would reduce domestic demand and make the recession even worse. (automatic fiscal stabilisers)
Investment. The government may invest in public sector
ii) investment. For example, building schools, hospitals, better roads. This investment can give a return on the investment which helps to boost productive capacity and increase economic growth. In this case, the government is acting like a firm who takes out a loan to finance investment.
iii) Spending commitments. The government is committed to providing certain benefits, such as pensions and health care spending. With an ageing population, this puts upward pressure on government spending to rise; therefore, governments may start to run a structural deficit. See – rising cost of pension spending

1C)

Diminishing returns, also called law of diminishing returns or principle of diminishing marginal productivity, economic law stating that if one input in the production of a commodity is increased while all other inputs are held fixed, a point will eventually be reached at which additions of the input yield ..

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