Economics 2023 Jamb Examination

Economic profit is calculated as total revenue minus total economic cost.
Total revenue = N1,000,000.
Total economic cost = N750,000.\[ \text{Economic Profit} = 1,000,000 - 750,000 = 250,000 \]This means the firm earns an economic profit of N250,000 because all costs, including opportunity costs, have been accounted for.

Many West African countries continue to experience challenges due to historical ties and economic dependence on their former colonial masters.
This affects political decision-making, trade policies, and development strategies.
Hence, relations with colonial masters remains a major longstanding issue.

Normative economics deals with value judgements, insights, and intuitive reasoning to develop hypotheses about what the economy should be like.
It relies on subjective logic rather than empirical observation.
Thus, intuition and insight align with normative economic reasoning.

Productivity is heavily influenced by the size, skill, and efficiency of the labour force.
A strong labour force provides the human input necessary for output growth.
Thus, labour force quality and quantity are core contributors to productivity.

Nigeria uses the Consumer Price Index (CPI) as the standard measure of inflation.
The CPI tracks changes in the prices of a fixed basket of consumer goods and services.
It is the most widely applied inflation indicator globally.

Economics is built on the concept of scarcity, meaning resources are limited while human wants are unlimited.
This mismatch forces societies to make choices regarding allocation.
Therefore, scarcity is the root economic problem.

The diagram shows a typical monopoly structure where the firm faces a downward sloping demand curve and has market power.
Monopolies restrict output and influence price unlike perfect competition.
This market behaviour corresponds to monopoly representation.

The lowest price a monopolist can charge corresponds to the point on the average cost or demand curve where output is sustained without losses.
In the diagram, P2 marks the minimum viable price level for production.
Thus, P2 is the lowest price.

The maximum price relates to the highest point on the demand curve where consumers are willing to pay before quantity demanded falls to zero.
In the diagram, P4 clearly represents this highest price level.
Therefore, the maximum attainable price is P4.

Real cost refers to the actual resources sacrificed to produce a good, including effort, time, and alternative uses of resources.
It is defined as the true cost of production in economic terms.
Thus, it aligns with the concept of true cost.