WAEC Economics past questions and answers

Checked by the Skolra question team · Last updated 23 October 2026

WAEC Economics: 458 objective past questions from 9 papers between 2016 and 2024, each with the answer and an explanation. Here are ten.

How the WAEC Economics paper is set. On WAEC's 2026 timetable for private candidates, Paper 1 (objective) takes 1 hour and Paper 2 (essay) 2 hours. If the question paper on the day gives another time, follow the question paper. The questions here are from Paper 1.

1. 1.

   (a) Differentiate between unemployment and underemployment.

   (b) With one example each, explain the following
   (i) Seasonal unemployment
   (ii) Structural unemployment
   (iii) Frictional unemployment
   (iv) Cyclical unemployment

   1. A
      Seasonal unemployment occurs when workers are temporarily without work due to seasonal changes in demand
      Correct
   2. B
      Frictional unemployment is a permanent and unavoidable form of unemployment
   3. C
      Cyclical unemployment occurs only in agricultural and fishing sectors
   4. D
      Structural unemployment is caused by insufficient aggregate demand in the economy
   Show answerHide answer

   Answer: A

   Seasonal unemployment arises when demand for certain types of labour fluctuates with the seasons, for example, farm workers unemployed during non-harvest periods. Structural unemployment results from a mismatch between workers' skills and available jobs due to technological change or industrial decline. Frictional unemployment is short-term, occurring when workers are between jobs, while cyclical unemployment results from downturns in the business cycle.

2. 2.

   income is redistributed when the rich are progressively taxed and?

   1. A
      The proceeds are used to finance military expenditure
   2. B
      The proceeds are deposited in the central bank's reserves
   3. C
      The proceeds are transferred to the poor through subsidies and social benefits
      Correct
   4. D
      The proceeds are used to reduce government external debt
   Show answerHide answer

   Answer: C

   Income redistribution through progressive taxation and social transfers involves collecting more tax from higher-income earners and channelling those funds to lower-income groups through subsidies, welfare payments, free healthcare, and education. This reduces income inequality and raises the living standards of the poor. It is a key tool of fiscal policy in addressing wealth disparities in society.

3. 3.

   An increase in a country's production capacity usually leads to economic

   1. A
      growth
      Correct
   2. B
      stagnation
   3. C
      depression
   4. D
      recession
   Show answerHide answer

   Answer: A

   An increase in a country's production capacity means the economy can now produce more goods and services than before, which is exactly what economists call economic growth — a rise in the total output (real GDP) an economy is able to produce.

4. 4.Human wants are insatiable because wants are
   1. A
      Easily satisfied with available resources
   2. B
      Unlimited and recurrent in nature
      Correct
   3. C
      Confined to the wealthy members of society
   4. D
      Limited to basic necessities only
   Show answerHide answer

   Answer: B

   Human wants are described as insatiable because they are unlimited and keep recurring — satisfying one want gives rise to new ones. This unlimited nature of wants in the face of scarce resources is the fundamental economic problem.
5. 5.

   Which of the following is not a problem facing Economic Community of West African States (ECOWAS)?

   1. A
      Political instability in some member states
   2. B
      Similar cultural and historical ties among member states
      Correct
   3. C
      Poor transportation and communication network linking member states
   4. D
      Multiplicity of currencies among member states
   Show answerHide answer

   Answer: B

   ECOWAS (Economic Community of West African States) faces several well-known obstacles to integration: political instability in some member countries disrupts cooperation and investment; multiplicity of currencies (different national currencies with different values) makes trade and payments across the sub-region difficult; and a poor transportation and communication network linking member states raises the cost of moving goods and people, slowing intra-regional trade.

   Similar cultural and historical ties among member states is, however, not a problem — shared cultural and historical links (many member states share ethnic, linguistic and historical connections across borders) actually help promote unity and cooperation within ECOWAS rather than hinder it. This is why it is the correct answer to "which of the following is NOT a problem facing ECOWAS".

6. 6.

   the value added method used in measuring national income is to

   1. A
      Sum the value added by each producer at each stage of production
      Correct
   2. B
      Add up total expenditure on final goods and services
   3. C
      Count only the value of exported goods
   4. D
      Sum up all incomes earned by factors of production
   Show answerHide answer

   Answer: A

   The value added (output) method measures national income by summing the value added at each stage of production across all industries. Value added is the difference between the value of output and the cost of intermediate inputs, which avoids double-counting.

7. 7.

   Demand-pull inflation can be as a result of___________

   1. A
      supply chain disruptions reducing the quantity of goods available in the market
   2. B
      trade union pressure leading to wage increases that exceed productivity growth
   3. C
      rising costs of imported raw materials pushing up production expenses
   4. D
      an excessive increase in money supply that boosts aggregate demand beyond productive capacity
      Correct
   Show answerHide answer

   Answer: D

   Demand-pull inflation occurs when aggregate demand in the economy grows faster than aggregate supply, pulling prices upward. Common causes include:

   • Excessive money supply growth — when the central bank prints too much money or keeps interest rates very low, consumers and businesses have more money to spend, pushing up demand.
   • Rising government expenditure financed by borrowing.
   • A boom in consumer credit and borrowing.
   • Strong export demand.
8. 8.

   an exceptional demand curve can result from?

   1. A
      Goods with perfectly inelastic demand curves
   2. B
      Giffen goods or Veblen (prestige) goods
      Correct
   3. C
      Normal goods with high price elasticity of demand
   4. D
      Goods that have many close substitutes available
   Show answerHide answer

   Answer: B

   An exceptional (upward-sloping) demand curve arises when higher prices lead to higher, rather than lower, quantity demanded — violating the normal law of demand. This can occur with Giffen goods (inferior goods where the income effect dominates the substitution effect, such as staple foods during poverty) and Veblen goods (luxury or prestige goods whose demand rises with price as a symbol of wealth). Speculation can also temporarily produce an upward-sloping demand curve.

9. 9.

   (a) What is a tax?

   (b) Distinguish between tax evasion and tax avoidance.

   (c) Identify any four benefits of tariffs.

   1. A
      A compulsory levy imposed by government on individuals and firms
      Correct
   2. B
      A payment businesses make only when they earn profit
   3. C
      A fine collected by government for violation of laws
   4. D
      A voluntary payment made by citizens to fund public services
   Show answerHide answer

   Answer: A

   A tax is a compulsory financial charge imposed by a government authority on individuals and organisations to fund public expenditures. Unlike fees or fines, taxes are mandatory and not tied to a specific service received in return. Tax evasion is the illegal non-payment of taxes, while tax avoidance is the legal arrangement of affairs to minimise tax liability.

10. 10.

    A joint stock company enjoys perpetual existence because

    1. A
       its liability is limited to the value of shares held
    2. B
       it is a separate legal entity distinct from its owners
       Correct
    3. C
       it is managed by a board of elected directors
    4. D
       its shares are transferable on the stock exchange
    Show answerHide answer

    Answer: B

    A joint stock (incorporated) company is registered as a separate legal entity distinct from its owners. Once incorporated, the law recognises the company as an artificial legal person in its own right, independent of the shareholders who hold its shares.

The questions come from past JAMB, WAEC and NECO papers. We use software to help write the answer options and explanations, and every answer is checked twice before it goes on the site. How we check

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