2024 NABTEB GCE ECONOMICS: NABTEB GCE Economics (Econs) 2025 Legit Answers (6832)

(3a)
Overpopulation refers to a situation where the number of individuals in a population exceeds the carrying capacity of their environment, leading to negative consequences for both the population and the environment. This can result from various factors such as increased birth rates, decreased mortality rates, and large-scale migration.

(3b)
(i) Economic Growth: A larger population can lead to increased economic activity as more people contribute to the labor force, driving demand for goods and services. This can stimulate business growth and innovation.

(ii) Increased Workforce: An increasing population provides a larger pool of labor, which can enhance productivity and economic output. A diverse workforce can also bring various skills and ideas, fostering innovation.

(iii) Market Expansion: More people can lead to expanded markets for businesses, allowing companies to grow and potentially leading to lower prices due to economies of scale.

(iv) Cultural Diversity: An increasing population often brings cultural diversity, which can enrich societies 'copied from e x a m p l a z a . c o m free' through the introduction of new ideas, customs, and practices that enhance social cohesion and creativity.

(4a)
A chain of distribution refers to the series of steps or processes involved in moving goods from producers to consumers. It encompasses all intermediaries involved in the distribution process, including manufacturers, wholesalers, retailers, and logistics providers. The chain ensures that products reach their final destination efficiently and effectively.

(4b)
(i) Bulk Purchasing: Wholesalers buy large quantities from manufacturers and sell them in smaller quantities to retailers or other businesses, allowing producers to focus on production without worrying about individual sales.

(ii) Storage: They provide storage facilities for goods until they are needed by retailers, helping manage inventory levels and reduce costs related to warehousing for producers.

(iii) Market Information: Wholesalers gather market intelligence about consumer preferences and trends, which they share with manufacturers to help them adjust production strategies.

(iv) Risk Bearing: By purchasing goods in bulk, wholesalers assume the risk of unsold inventory, protecting 'copied from e x a m p l a z a . c o m free' manufacturers from potential losses due to fluctuations in demand.

(4c)
(i) Cost Reduction: Eliminating wholesalers can reduce distribution costs by cutting out intermediaries, allowing manufacturers to sell directly to consumers or retailers at lower prices.

(ii) Improved Communication: Direct selling can enhance communication between producers and consumers, leading to better understanding of customer needs and quicker response times.

(iii) Increased Profit Margins: Manufacturers may retain a larger share of profits by selling directly without having to share margins with wholesalers.

(iv) Streamlined Distribution: Removing wholesalers can simplify the supply chain, reducing complexity and improving efficiency in getting products to market.

(5a)

Specialisation refers to the process by which individuals, businesses, or countries focus on producing a limited range of goods or services in which they have a particular expertise or efficiency. By concentrating on one or a few tasks, producers can increase productivity and improve efficiency. This allows for the production of goods at lower costs and greater levels of quality.

(5b)

(i) Increased Efficiency: Specialisation allows individuals or businesses to focus on specific tasks, becoming more skilled and efficient at them. This leads to higher productivity and lower costs of production.

(ii) Higher Quality: When producers specialise, they gain experience in a particular area, which can lead to better-quality goods and services due to focused expertise.

(iii) Cost Reduction: Specialisation allows workers or companies to streamline their operations, reduce waste, and decrease the time required to produce goods, ultimately lowering production costs.

(iv) Encouragement of Innovation: By specialising in a specific area, businesses or individuals are more likely to innovate within their niche, developing new products, technologies, or processes that can improve overall productivity.

(5c)

(i) Overdependence: Specialisation may lead to overdependence on a particular product, service, or industry. If demand decreases or the market conditions change, this could lead to 'copied from e x a m p l a z a . c o m free' significant economic instability for the specialised producer.

(ii) Monotony: In the case of workers, specialisation can lead to repetitive tasks, which can result in job dissatisfaction, lack of motivation, and low morale.

(iii) Vulnerability to External Shocks: Specialisation can make economies or businesses vulnerable to changes in the global market, technological disruptions, or resource shortages, as they are heavily focused on a single sector or activity.

(iv) Limited Flexibility: Specialised firms or workers may find it difficult to adapt to new industries or skills, as their training and experience are concentrated in a specific area. This can make it harder to diversify and respond to market shifts.

(6a)

Economies of scale refer to the cost advantages that businesses experience when production becomes efficient as a result of an increase in the scale of production. As output increases, the average cost per unit typically decreases due to factors such as operational efficiencies, bulk purchasing discounts for materials, and spreading fixed costs over a larger number of goods produced.

(6b)

(i) Low Start-Up Capital Requirement: Many Nigerians have limited access to financing and cannot afford the high costs of establishing large-scale businesses. Small-scale businesses provide a feasible alternative, allowing entrepreneurs to start with minimal resources.

(ii) Employment Opportunities: Small-scale businesses play a crucial role in addressing Nigeria’s unemployment challenges. They create jobs for a significant portion of the population, especially in rural areas where large corporations may not operate.

(iii) Market Niches and Customization: Small-scale businesses can cater to local and niche markets by providing customized products and services that large firms might overlook. For instance, small shops and tailors meet specific customer needs within their communities.

(iv) Government Support and Policies: The Nigerian government provides incentives, such as tax relief and grants, to promote small and medium enterprises (SMEs). These policies encourage the growth and survival of 'copied from e x a m p l a z a . c o m free' small-scale businesses.

(v) Cultural and Social Preferences: Cultural factors in Nigeria often favor small businesses, such as local food vendors, artisans, and craftsmen, who provide goods and services aligned with traditional practices and comm

unity needs.

(7a)

National income is the total value of all goods and services produced by a country over a specific period (usually one year). It includes income earned by residents from investments abroad minus income earned by foreign residents from domestic investments

(7b)

(i) Production Method: This method calculates national income based on the total output produced by all sectors within an economy during a given period.

(ii) Income Method: This approach measures national income by summing all incomes earned by factors of production within an economy—wages for labor, rents for land, interest for capital, and profits for entrepreneurship.

(iii) Expenditure Method: This method calculates national income based on total spending on final goods and services within an economy during a specified period; consumption + investment + government spending + net exports (exports minus imports).

(7c)

(i) Exclusion of Non-Market Transactions: Many valuable contributions such as household labor or volunteer work are not captured in national income calculations because they do not involve monetary transactions.

(ii) Informal Economy Challenges: The existence of informal sectors makes it difficult to accurately measure national income since many transactions are unrecorded or unregulated.

(iii) Price Level Changes: Adjusting national income figures for inflation is complex; 'copied from e x a m p l a z a . c o m free' using different price indices can lead to discrepancies in reported figures over time

(8a)

A tax is a mandatory financial charge imposed by a government on individuals or entities that is used to fund public expenditures and services such as infrastructure, education, healthcare, and social welfare programs.

(8b)

(i) Equity: Taxes should be fair; individuals with similar abilities should pay similar amounts while those with greater ability should pay more (vertical equity).

(ii) Certainty: The tax system should be clear so that taxpayers know how much tax they owe and when it is due; this reduces confusion and promotes compliance.

(iii) Convenience: The payment process should be simple for taxpayers; taxes should be easy to pay without excessive burden on individuals or businesses.

(iv) Efficiency: The cost of collecting taxes should be low relative to the revenue generated; this ensures that resources are not wasted in tax administration.

(8c)

(i) Revenue Generation: Taxes provide governments with essential funds needed for public services such as education, healthcare, infrastructure development, and defense.

(ii) Redistribution of Wealth: Through progressive taxation systems where higher earners pay more taxes relative to their income, governments aim to reduce income inequality within society.

(iii) Economic Stabilization: Taxes can be used as tools for economic policy; adjusting tax rates can influence consumer 'copied from e x a m p l a z a . c o m free' spending behavior and overall economic activity during different phases of economic cycles.

(iv) Behavioral Incentives: Governments may levy taxes on certain activities (such as smoking or pollution) as a means to discourage undesirable behaviors while promoting public health or environmental sustainability.