1. The  table below gives the cost in ₵000 and output of a hypothetical firm. The market price of the good is fixed at ₵10,000 per unit. Use the data to answer the questions that follow

Output (units)0123456
Total cost (₵000)101215193240x
  1. Calculate

i. The average cost of producing two units ii. The total variable cost of producing 5 units

ii. The average fixed cost of producing four units

b. If the marginal cost of producing the sixth unit is ₵20,000 calculate the cost of producing six units

c. Work out the total profit when output is 6 units

d. In what market is the firm selling? Explain your answer

  1. The diagram below shows the situation of a hypothetical perfect competitive firm making losses in short
    equilibrium. Use it to answer the questions that follow

a. At the equilibrium output (25), what is the firm’s
i. Average cost
j. ii. Average revenue
k. iii. Total cost
l. iv. Total revenue
v. average variable cost
vi. Total variable cost
vii. Average fixed cost
viii. Total fixed cost

b. What is the total amount of loss of the firm
c. What advice would you give to the firm regarding production? Give reasons

SECTION B
Answer three questions only from this section.

  1. (a) What is a trade union? [2 marks]
    (b) Describe any four functions of trade unions. [12 marks]
    (c) Outline any two weapons used by trade unions to achieve their objectives. [6 marks]
  2. (a) Outline any four objectives of a price control policy. [8 marks]
    (b) Highlight any four effects of a maximum price control policy. [12 marks]
  3. (a) What are infant industries? [2 marks]
    (b) State any four reasons for protecting infant industries. [12 marks]
    (c) Outline any three ways by which industries can be financed in West Africa. [6 marks]
  4. (a) Why is scarcity a fundamental problem in Economics? [6 marks]
    (b) Give one reason each why Economics is a
    (i) science; [3 marks]
    (ii) social science. [3 marks]
    (c) How do governments solve the problem of scarcity? [8 marks]
  5. (a) Distinguish between the following pairs of cost concepts:
    (i) Fixed cost and variable cost; [5 marks]
    (ii) Real cost and money cost; [5 marks]
    (iii) Implicit cost and explicit cost. [5 marks]
    (b) (i) What would you recommend to a firm whose average variable cost is greater
    than its price? [2 marks]
    (ii) Give a reason for your answer in (b) (i). [3 marks]
  6. (a) Trace the development of the African Development Bank (A.D.B.). [8 marks]
    (b) Give three reasons for the establishment of the African Development Bank (A.D.B.). [12 marks