Economics 2020 Jamb Examination

Debentures are fixed-interest securities issued by a company as a form of long-term borrowing.
Holders of debentures receive a fixed rate of return regardless of the company’s profit level because the payment is treated as interest rather than dividend.
Preference and ordinary (common) stock attract dividends, but these dividends are not fixed—preference stock has priority but still depends on profitability. Bank loans involve interest payments but are not classified as business 'finances' that give the holder a dividend entitlement.
Debentures therefore uniquely satisfy the condition of fixed return.

Expenditure on raw materials represents actual monetary payments made by a firm in the production process.
Explicit costs are out-of-pocket expenses that involve direct financial payments, unlike implicit costs which represent opportunity costs.
Although raw materials form part of prime cost, the question asks specifically for the cost classification in terms of accounting cost categories. Explicit cost is the most correct classification.

When firms cluster within the same geographical area, they benefit from external economies of scale—cost advantages that arise from the overall growth and concentration of an industry, not from the individual firm's expansion.
This may include shared skilled labour, infrastructure, and specialised suppliers.
Agglomeration economies describe the same phenomenon, but the broader economic term that the question demands is external economies of scale, which result directly from industrial concentration.

Dumping occurs when a country exports goods at prices lower than the domestic cost of production.
This practice is often aimed at penetrating foreign markets or eliminating competition abroad.
The other options describe general trade arrangements rather than pricing strategies, making dumping the correct term for the scenario.

Poor town planning makes it difficult for census officers to properly access households, identify residential structures, and enumerate individuals accurately.
Irregular street layouts, slum expansion, and lack of clear housing identification create logistical challenges.
While migration and birth rates affect population size, they do not constitute direct administrative obstacles in the census-taking process.

Labour is considered the most mobile factor of production because workers can move geographically and occupationally more easily than other factors.
Land is immovable, capital may face institutional and regulatory restrictions, and entrepreneurs are limited by risk, skills, and market familiarity.
Labour therefore has both occupational and geographical mobility, making it the most mobile factor overall.

Rural-urban drift involves the movement of people from the countryside to urban centres in search of better living conditions, education, social amenities, and employment opportunities.
This trend reduces the number of able-bodied workers available for agricultural activities, directly weakening the agricultural labour force.
Other options may influence agricultural productivity but do not account directly for the loss of labour.

OPEC’s primary mandate is the regulation of crude oil production among member states through production quotas.
By coordinating and controlling output levels, OPEC aims to stabilise the oil market and maintain favourable price levels for member countries.
Unity and political stability may be desirable but are not the core operational objective. Enforcement of production quotas is central to OPEC’s existence.

Plywood manufacturing requires bulky raw materials such as timber, which are expensive to transport over long distances.
Locating production facilities near forests or timber sources reduces transportation costs and prevents wastage due to handling and deterioration.
Thus, raw materials are the primary locational determinant for plywood industries.

A population experiencing increasing returns is one in which additional people contribute positively to output, leading to higher per-capita productivity.
This situation arises when the population is below the level required to maximise available resources—i.e., the country is under-populated.
Overpopulation would result in diminishing rather than increasing returns.