2014 WASSCE ECONOMICS THEORY

1. QUESTION
The table below shows an extract from balance of payments for country A. Use the table to answer the
questions that follow:
Balance of payments items
S/N Items of transaction Receipt $ Payment $
1. Merchandise (visible trade) 52,000 40,000
2. Shipping other transport and travel 4,000 8,000
3. Investment incomes 20,000 5,000
4. Other services 2,500 7,500
5. Unrequired transfers 22,800 7,000
6. Direct investment 50,000 26,000
7. Other long term capital 254,000 289,000
8. Start term capital 221,000 238,000
Calculate the:
(a) balance of trade
(b) balance on current account
(c) balance on capital account
(d) balance of payment

2. QUESTION
The table below presents the price and quantity supplied by a palm oil producer. Use the information in
the table to answer the following questions.
Price ($) Quantity Supplied (Gallons)
6 200
12 300
18 400
20 500
24 600
(a) If the price of palm oil falls from $20.00 to $18.00, calculate the price elasticity of supply.
(b) Interpret your answer in question 2(a) above.
(c) Study the extract below and answer the following questions. The price of palm oil remains at $6.00
per gallon and an increase in the price of a related product causes an increase in the supply of palm
oil:
(i) Give a graphical presentation to illustrate this change.
(ii) Indicate the type of supply for the two products.
(d) State reasons that can cause a change in supply.

3. QUESTION
(a) Define occupational mobility of labour
(b) Identify any four barriers to occupational mobility of labour.
(c) State any two factors that will make labour efficient

4. QUESTION
(a) What is crop farming?
(b) Outline any four measures that can be adopted to increase crop production in your country.
(c) State any two contributions of the industrial sector to agriculture in your country.

5. QUESTION
(a) Highlight any four differences between public limited liability company and a private limited liability
company.
(b) Explain any four advantages of a limited liability company.

6. QUESTION
(a) Define gross national income.
(b) Using appropriate examples, distinguish between:
(i) Personal income and disposable income.(ii) Nominal income and real income.
(c) Outline any three uses of national income statistics.
7. QUESTION
(a) What is the normal chain of distribution?
(b) State any three functions of middlemen in the chain of distribution.
(c) Highlight any four problems involved in the distribution of goods in West Africa.

8. QUESTION
(a) What is a specific tax?
(b) Explain with the aid of diagrams, the effects of specific tax on a commodity that has a:
(i) perfectly elastic demand;
(ii) perfectly inelastic demand
(c) State two differences between a direct tax and an indirect tax.