WAEC Economics 2016 past questions

Checked by the Skolra question team · Last updated 15 October 2026

Ten questions from the 2016 WAEC Economics paper, with answers and explanations. We hold 49 questions from this paper, and the Skolra app has all of them.

WAEC Economics 2016 questions and answers

1. 1.The principle of comparative cost advantage was propounded by
   1. A
      David Ricardo
      Correct
   2. B
      John Maynard Keynes
   3. C
      Adam Smith
   4. D
      Alfred Marshall
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   Answer: A

   The principle of comparative cost advantage was developed by David Ricardo in the early 19th century. It states that a country should specialise in producing and exporting goods in which it has a lower opportunity cost relative to other countries, even if it is absolutely less efficient in all production.
2. 2.

   The supply of rice in tons is given by the fraction: Qs-80-0.7=0. Where Qs= Quantity supplied, P=price in naira.

   Find Qs, when P=N40

   1. A
      80
   2. B
      52
   3. C
      28
   4. D
      108
      Correct
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   Answer: D

   The supply function is Qs = 80 + 0.7P. When P = 40: Qs = 80 + 0.7(40) = 80 + 28 = 108 tons. The equation rearranges to give quantity supplied by substituting the given price.
3. 3.How does producers' expectation of a price fall affect the supply curve of a product? There will be
   1. A
      An upward movement along the supply curve
   2. B
      No change in the supply curve
   3. C
      A rightward shift of the supply curve
      Correct
   4. D
      A leftward shift of the supply curve
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   Answer: C

   If producers expect prices to fall in the future, they will rush to sell their stock now while prices are still relatively higher. This increases current supply, causing the supply curve to shift to the right. This is an example of a non-price factor shifting the supply curve.
4. 4.Which of the following will encourage capital intensive farming
   1. A
      Abundance of arable land at low cost
   2. B
      Availability of abundant and cheap agricultural labour
   3. C
      High cost of labour relative to capital
      Correct
   4. D
      Government subsidies on fertilizers only
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   Answer: C

   Capital-intensive farming substitutes machinery and technology for labour. When the cost of labour is high relative to capital, it becomes economically rational for farmers to invest in machines (tractors, harvesters, etc.) instead of hiring many workers, thus encouraging capital-intensive methods.
5. 5.One relationship between marginal utility and total utility
   1. A
      Total utility always equals marginal utility
   2. B
      Marginal utility rises when total utility is at its maximum
   3. C
      Total utility is at its maximum when marginal utility is zero
      Correct
   4. D
      Total utility falls when marginal utility is positive
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   Answer: C

   Total utility increases as long as marginal utility is positive. When marginal utility falls to zero, total utility reaches its peak (maximum point) — this is the point of satiation. Beyond this, if marginal utility becomes negative, total utility begins to fall.
6. 6.When the international value of a country's currency rises, other things being equal, the country's
   1. A
      Domestic production increases due to greater export demand
   2. B
      Balance of trade automatically improves
   3. C
      Exports become more expensive and imports become cheaper
      Correct
   4. D
      Exports become cheaper and imports become more expensive
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   Answer: C

   When a country's currency appreciates (rises in value), its exports become more expensive for foreign buyers (reducing export demand) while imports become cheaper for domestic consumers (increasing import demand). This tends to worsen the balance of trade.
7. 7.The demand for torch and batteries is an example of
   1. A
      Joint demand
      Correct
   2. B
      Composite demand
   3. C
      Derived demand
   4. D
      Competitive demand
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   Answer: A

   Joint demand (also called complementary demand) occurs when two goods must be used together to satisfy a want — a torch is useless without batteries and vice versa. When the demand for one good automatically generates demand for the other, economists describe the relationship as joint demand. This contrasts with composite demand, where several goods independently satisfy the same want.

8. 8.What effect will an increase in price have on the total revenue of a firm whose product has inelastic demand? total revenue will
   1. A
      Decrease
   2. B
      Increase
      Correct
   3. C
      Remain constant
   4. D
      First increase then decrease
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   Answer: B

   When demand is inelastic, consumers are not very responsive to price changes. A price increase causes a less-than-proportionate fall in quantity demanded, so total revenue (Price × Quantity) rises. This is a key feature of inelastic demand.
9. 9.Scale of preference is important for the following reasons except in
   1. A
      Making rational choices among alternatives
   2. B
      Ranking wants in order of priority
   3. C
      Eliminating the scarcity of resources
      Correct
   4. D
      Efficient allocation of scarce resources
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   Answer: C

   A scale of preference helps individuals rank their wants, make rational choices, and allocate limited resources efficiently. However, it cannot eliminate the fundamental problem of scarcity; scarcity is an inherent economic condition that no ranking system can remove.
10. 10.In a partnership, the conduct of members is guided by
    1. A
       The company prospectus
    2. B
       The partnership deed
       Correct
    3. C
       The memorandum of association
    4. D
       The articles of association
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    Answer: B

    The partnership deed (also called a partnership agreement) is a legal document that sets out the rights, duties, profit-sharing ratios, and conduct of partners in a partnership. A memorandum and articles of association and a prospectus relate to companies, not partnerships.

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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