Explanation:

The correct answer is:

B. Outward shift of the PPC

Topic: Technology and PPC

When a country uses new technology, it can make things faster and more easily. This helps the country produce more goods and services. The PPC moves outward to show this increase in the country’s ability to make things.

Here's why the other answers are wrong:

• A. Movements along the PPC: This would happen if the country changes what it makes, but not because of new technology.


• C. Inward shift of the PPC: This would happen if the country has fewer resources or less efficiency, not because of new technology.


• D. Movements within the PPC: This shows the country is not using all of its resources, which is different from using new technology to improve production.

Explanation:

The correct answer is:

D. Large pool of unemployed casual workers

Topic: Opportunity Cost

The real cost of buying the tractor is not just the money paid for it. It's also about what the community could have done with that money instead. For example, the money could have been used to hire workers who are now unemployed. This is called opportunity cost.

Here's why the other answers are wrong:

• A. Amount spent to acquire it: This is the direct cost of buying the tractor, but not the real cost, which includes what is given up to buy it.


• B. Amount spent on maintenance of the tractor: Maintenance is an ongoing cost, not the real cost of the initial purchase.


• C. Cost of buying diesel for the tractor: Diesel is a cost to run the tractor, but it is not the real cost of acquiring it.

Explanation:

The correct answer is:

A. Entrepreneur

Topic: Factors of Production

Entrepreneurs are people who take risks by starting businesses or investing money. They can make profits if their business does well, but they might also lose money if it fails.

Here's why the other answers are wrong:

• B. Labour: Workers are paid wages for their work, but they don’t take on the same kind of risk as entrepreneurs.


• C. Capital: Capital refers to money or equipment used in production. It doesn’t take on risk like entrepreneurs do.


• D. Land: Land is a resource used for production, but it doesn't involve risk like entrepreneurship does.

Explanation:

The correct answer is:

C. Rewards efficiency and innovation

Topic: Free Enterprise System

In a free enterprise economy, businesses compete to offer the best goods and services. This competition makes businesses work better and think of new ideas. This helps the economy grow and improve.

Here's why the other answers are wrong:

• A. Gives government total control of economic activities: In a free enterprise system, the government does not control everything. Private businesses and people make most decisions.


• B. Ensures equitable distribution of income: A free enterprise system doesn’t make sure everyone earns the same. Some people may earn more than others.


• D. Makes citizen and government, owners of the factors of production: In this system, private citizens, not the government, own things like land, factories, and money.

Explanation:

The mode is the value that appears most frequently in a given set of data.

Let's look at the data set provided:

20, 40, 20, 28, 20, 30, 20, 18, 40, 24, 18, 15

Now, let's count the frequency of each number:

• 20 appears 4 times
• 40 appears 2 times
• 18 appears 2 times
• 28, 30, 24, and 15 each appear 1 time

The number 20 appears most frequently (4 times).

Therefore, the mode is 20 kg.

The correct answer is:

C. 20 kg

Explanation:

The correct answer is:

C. Change of production technology

Topic: Factors Determining Demand

The change in production technology affects how much of a good is made, not how much people want to buy it. Demand for a product is based on things like what consumers like, the price of related products, and the price of the product itself.

Here's why the other answers are wrong:

• A. Taste of the consumer: If people like something more, they will buy more of it, which affects demand.


• B. Price of related commodities: If the price of similar goods changes, it can affect demand. For example, if the price of tea goes up, people might buy more coffee instead.


• D. Price of the commodity: The price of a product affects how much people want to buy. If the price goes up, people may buy less.

Explanation:

The correct answer is:

C. Equal to infinity

Topic: Price Elasticity of Demand

A demand curve that is parallel to the price axis means that consumers will buy any amount of the product at a certain price. This kind of demand is called "perfectly elastic," which means that the price elasticity is infinite.

Here's why the other answers are wrong:

• A. Equal to one: This means unitary elasticity, where the percentage change in quantity demanded equals the percentage change in price. It’s not applicable to a demand curve like this.


• B. Equal to minus one: This also refers to unitary elasticity but doesn’t apply to a perfectly elastic demand curve.


• D. Greater than one: This refers to elastic demand, but the demand in this case is perfectly elastic, which means it is infinite.

Explanation:

The correct answer is:

B. Fairly elastic

Topic: Tax Incidence

If the seller pays more of the tax, it means that buyers are sensitive to price changes. This shows that demand is elastic, which means that people will buy less when the price increases because of the tax.

Here's why the other answers are wrong:

• A. Perfectly inelastic: This means that demand doesn’t change no matter how much the price goes up. This is not the case here.


• C. Perfectly elastic: This means demand would drop completely with any price increase, which is not what happens when sellers bear more of the tax.


• D. Fairly inelastic: If demand were inelastic, people would still buy almost the same amount even if the price increases. This is not the case here because demand is sensitive to price changes.

Explanation:

The correct answer is:

C. Leave total revenue unchanged

Topic: Unit Price Elasticity

When demand is unit price elastic, the change in price is exactly balanced by the change in how much people buy. This means total revenue (the money from selling the good) stays the same, even if the price goes down.

Here’s why the other answers are wrong:

• A. Lead to a reduction in quantity demanded: If demand is unit elastic, the quantity people buy changes in a way that keeps total revenue the same, not less.


• B. Decrease demand by a smaller percentage: This would happen if demand were inelastic, not unit elastic.


• D. Leave quantity demanded unchanged: The amount people buy changes, but it’s balanced with the price change, so it’s not unchanged.

Explanation:

The correct answer is:

A. Perfectly inelastic

Topic: Inelastic Demand

If a good has no substitute, people will still buy it even if the price goes up. This means the demand doesn’t change with price, making it perfectly inelastic.

Here’s why the other answers are wrong:

• B. Infinitely elastic: This means that demand would drop to zero with even a small price increase, which isn’t true when there’s no substitute.


• C. Fairly elastic: This would mean people would still reduce their buying if the price increases, but with no substitute, they can’t.


• D. Perfectly elastic: This would mean demand changes a lot with price changes, but if there’s no substitute, demand stays the same no matter what.

Explanation:

The correct answer is:

A. Joint supply

Topic: Supply Relationships

When two goods are in joint supply, it means that producing more of one good also results in more of the other. This happens because both goods come from the same resources or process.

Here’s why the other answers are wrong:

• B. Competitive supply: This is when two goods compete for the same resources. If one is made more, the other might be made less.


• C. Composite supply: This refers to a situation where different goods are combined to meet a single demand, not what’s happening here.


• D. Fixed supply: This means the supply doesn’t change, regardless of price or other factors, which doesn’t apply to the situation here.

Explanation:

The correct answer is:

C. Quantity supplied decreases

Topic: Law of Supply

If the price of a good goes down, producers are less interested in making or selling it because they can’t make as much profit. As a result, the amount they supply goes down.

Here’s why the other answers are wrong:

• A. Supply increases: This would happen if the price increased, not decreased.


• B. Quantity supplied increases: This would also happen if the price went up, not down.


• D. Supply decreases: Supply refers to the overall willingness to sell, while quantity supplied refers to the amount available at a specific price.

Explanation:

The correct answer is:

B. Rises and marginal utility declines

Topic: Utility Theory

When you consume more of a good, your total satisfaction (total utility) goes up. But the extra satisfaction you get from each additional unit (marginal utility) gets smaller.

Here’s why the other answers are wrong:

• A. and average utility will rise: Average satisfaction doesn’t always go up when you consume more. It might stay the same or go down.


• C. and marginal utility will rise: The extra satisfaction usually goes down as you consume more, not up.


• D. declines and marginal utility rises: Total satisfaction goes up, but the extra satisfaction (marginal utility) goes down.

Explanation:

The correct answer is:

D. Excess supply occurs.

Topic: Price Floors

When a price floor is set, it means the price cannot go below a certain level. If the price is set too high, there will be more goods available than people want to buy. This creates a surplus because producers want to sell more at the higher price, but consumers aren't willing to buy as much.

Here’s why the other answers are wrong:

• A. Excess demand is generated: This happens when prices are too low, not when they are too high.


• B. Parallel market is created: This is not a direct result of price floors. A parallel market may form if people try to bypass the price floor, but it’s not the main effect.


• C. Hoarding of goods occurs: While hoarding can happen in some cases, the main result of a price floor is excess supply, not hoarding.

Explanation:

The correct answer is:

C. Quantity will rise.

Topic: Changes in Market Equilibrium

When demand increases but supply remains constant, more people want to buy the good. This means that producers will be able to sell more at the current price, which leads to an increase in the quantity sold. However, the price typically rises as well because of the higher demand, but the key effect is that the quantity increases.

Here’s why the other answers are wrong:

• A. Price will remain unchanged: With more demand, the price usually goes up, so it doesn't stay the same.


• B. Price will fall: If demand increases, prices usually rise, not fall, because there are more people wanting to buy.


• D. Quantity will decrease: An increase in demand means more is sold, so the quantity will rise, not decrease.

Explanation:

The correct answer is:

A. Diseconomies of scale

Topic: Economies of Scale

When a company grows bigger, it can become less efficient. This means it will cost more to make each product. This is called diseconomies of scale. It happens when the company becomes too large and difficult to manage properly.

Here’s why the other answers are wrong:

• B. A low sales turnover: This means selling fewer products, but it doesn’t explain why costs go up when the company grows.


• C. Diminishing returns to production: This happens when adding more workers or machines doesn’t increase output as much, but it’s not the same as rising costs due to size.


• D. Increasing marginal returns: This means getting more output from each extra worker or machine, which is the opposite of higher costs.

Explanation:

The correct answer is:

B. The use of machinery is made possible

Topic: Division of Labour

When workers focus on specific tasks, it becomes easier to use machines that can do those tasks quickly and accurately. This helps improve production and makes it more efficient.

Here’s why the other answers are wrong:

• A. Risks of interdependence are increased: This is true, but it's not an advantage. It means workers rely on each other more.
• C. Standardization in production is discouraged: Actually, division of labour often leads to more standardized production, not less.
• D. Fewer workers get employed: Division of labour can lead to more workers being hired, not fewer, as different tasks need to be filled.

Explanation:

The correct answer is:

D. Variable Proportions

Topic: Cost Curves

The U-shape of the marginal and average cost curves is explained by the law of variable proportions. This law says that as more units of a variable factor (like labor) are added to fixed factors (like machinery), output increases at first. But after a certain point, adding more labor leads to less extra output, causing costs to rise. This results in the U-shape of the cost curves.

Here's why the other answers are wrong:

• A. Increasing returns: This refers to a situation where adding more input leads to increasing output, but it does not explain the cost curves' shape.
• B. Demand and the law of supply: These are related to market behavior and price, not cost curves.
• C. Diminishing marginal utility: This is a concept in consumer theory, not related to cost curves in production.

Explanation:

The correct answer is:

D. Slopes downwards from left to right

Topic: Monopoly Demand Curve

In a monopoly, the firm is the only one selling the service, so it faces the whole market's demand. The demand curve slopes downwards, which means that if the price goes down, more people will buy the service. This happens because the firm controls the supply.

Here’s why the other answers are wrong:

• A. Horizontal: A horizontal demand curve would mean the firm can sell any amount at the same price, which is not true for a monopoly.
• B. Slopes upwards: In a monopoly, when the price drops, demand goes up, not the other way around.
• C. Vertical: A vertical curve would mean that the amount of the service people want does not change with the price, which is not true for a monopolist.

Explanation:

The correct answer is:

C. Is zero

Topic: Total Variable Cost

Total variable cost is the cost that changes when production changes. When no output is produced (output is zero), there are no variable costs because no resources are being used. So, the total variable cost is zero until production starts.

Here's why the other answers are wrong:

• A. Increases slowly: When there is no output, there are no variable costs at all.
• B. Increases rapidly: This happens when production increases, not when output is zero.
• D. Is negative: Costs cannot be negative. They can only be zero or positive.

Explanation:

The correct answer is:

A. Its shares cannot be offered for sale publicly

Topic: Private Limited Company

A private limited company is different because it cannot sell its shares to the public. The shares are owned by a small group of people and can only be sold privately. This keeps control of the company within a small group of owners.

Here's why the other answers are wrong:

• B. It can borrow funds by issuing a debenture: While private companies can borrow money, issuing debentures is more common with public companies.
• C. It is formed by a minimum of seven persons: A private limited company can be formed with as few as one or two people, not seven.
• D. The business dies with the owner: This is not true for private limited companies. The business can continue even if the owner leaves or passes away.

Explanation:

The correct answer is:

C. Statutory corporations

Topic: Business Units

A statutory corporation is a business that is owned and run by the government. It is created by a law passed by the government. These types of businesses often provide important public services, like electricity or public transport, and they are controlled by the government.

Here's why the other answers are wrong:

• A. Cooperative societies: These are owned by members, not the government.
• B. Sole proprietorships: These are owned by individual people, not the government.
• D. Limited liability companies: These are private businesses owned by individuals or groups, not the government.

Explanation:

The correct answer is:

B. A wholesaler

Topic: Distributive Trade

In distributive trade, a producer can sometimes act as a wholesaler. This means the producer sells large amounts of goods directly to retailers or businesses, without using a middleman. The producer then becomes the wholesaler, providing goods in bulk for resale.

Here's why the other answers are wrong:

• A. An agent: An agent helps sell products but does not sell large amounts like a wholesaler.
• C. A consumer: A producer sells goods, while a consumer buys them.
• D. A hawker: A hawker sells small amounts to individual people, not in large quantities to businesses.

Explanation:

The correct answer is:

A. Birth rate minus death rate

Topic: Population Growth

The natural growth rate is found by subtracting the death rate from the birth rate. This shows if a population is growing or shrinking because of births and deaths only, without counting people moving in or out of the country.

Here's why the other answers are wrong:

• B. Total population minus number of deaths: This only tells you how many people are left after deaths, not the growth rate.
• C. Immigration rate minus emigration rate: This looks at people moving in or out, but doesn't show natural growth from births and deaths.
• D. Number of births minus net migration: This mixes birth rates with migration, which is not the same as natural growth.

Explanation:

The correct answer is:

B. Population may outgrow means of subsistence

Topic: Malthusian Theory of Population

Malthus' theory said that population grows faster than the food and resources needed to support it. He worried that if the population kept growing too quickly, there wouldn’t be enough food and resources to feed everyone, which could lead to poverty and hunger.

Here's why the other answers are wrong:

• A. People engaged in uncontrolled procreation: Malthus was more concerned about the speed of population growth, not uncontrolled procreation.
• C. Positive and preventive checks will wipe out population: Malthus believed these checks would reduce the population, but his main worry was that population growth would outpace resources.
• D. Population was growing at a geometric progression: Malthus did say that population grows quickly, but his main point was about the population outgrowing the food supply.

Explanation:

The correct answer is:

D. An increase in marginal productivity of labor

Topic: Wage Negotiations

Trade unions are more likely to win higher wages when workers become more productive. This means workers are making more things or adding more value for the company. When workers are more productive, employers are more likely to pay them higher wages because they are helping the company more.

Here's why the other answers are wrong:

• A. Mass unemployment in the country: If there is mass unemployment, employers may not want to raise wages because there are many workers looking for jobs.
• B. A fall in marginal productivity of labor: If workers become less productive, employers may not want to raise wages because the workers are adding less value to the company.
• C. Economic recession in the country: During a recession, companies are often struggling, so they are less likely to raise wages.

Explanation:

The correct answer is:

C. Rise at a rate higher than that of nominal wages

Topic: Real Wages and Inflation

Real wages show how much workers can buy with their income. If the prices of goods and services go up faster than workers' wages, they can't buy as much as before, so real wages decrease. This happens because workers' pay stays the same or increases slowly, but the cost of things they need is rising quickly.

Here's why the other answers are wrong:

• A. And nominal wages rise at the same rate: If wages and prices rise at the same rate, workers' ability to buy things stays the same, and real wages don’t change.
• B. Rise at a rate lower than that of nominal wages: If prices rise slower than wages, workers can buy more, so real wages go up.
• D. And nominal wages remain constant: If prices go up but wages stay the same, workers can buy less, so real wages fall.

Explanation:

The correct answer is:

B. Mechanized farming is adopted

Topic: Agricultural Productivity

Mechanized farming means using machines to help with farming tasks like planting, harvesting, and watering. Using machines makes these tasks faster and easier, so farmers can grow more food in less time. This increases the amount of food produced and lowers the cost of farming, making agriculture more productive.

Here's why the other answers are wrong:

• A. More schools are established in rural areas: While education is important, it doesn't directly increase farming productivity.
• C. Foreign substitutes are allowed to compete with local farm produce: Allowing foreign products to compete may reduce local farmers' income and hurt productivity.
• D. Subsistence farming is encouraged: Subsistence farming means growing just enough food for personal use. It doesn't increase productivity in the wider economy.

Explanation:

The correct answer is:

C. There is low level of income and savings

Topic: Industrialization in West Africa

One big reason many West African countries are not highly industrialized is that they don't have enough money or savings. Without enough income or savings, it's hard for businesses to grow, buy machines, or invest in new factories. This makes it harder for industries to develop and grow.

Here's why the other answers are wrong:

• A. They do not see the need for industrialization: This is not the main reason. Most countries do want to industrialize, but they face financial challenges.
• B. There is inadequate supply of unskilled labour: While there may be challenges with labor, it's mainly the lack of capital and investment that's the bigger issue.
• D. The size of the market is small: Even if markets are small, industries can still grow with the right investment and resources.

Explanation:

The correct answer is:

A. Establishing many industrial estates

Topic: Government Policies for Industrialization

Governments can help industry grow by setting up industrial estates. These are special areas where businesses can build factories and plants. The government provides basic things like roads, electricity, and water at lower costs, making it easier for businesses to operate. This leads to more investment, job creation, and faster industrial growth.

Here's why the other answers are wrong:

• B. Encouraging foreign firms to compete with domestic firms: This might not always help local businesses grow. It could make it harder for them to compete.
• C. Ensuring that local industries pay more taxes: High taxes can make it harder for businesses to grow because they have less money to invest in new projects.
• D. Discouraging international trade: Trade helps businesses grow by giving them access to bigger markets, so discouraging it would not help industrialization.

Explanation:

The correct answer is:

D. Input method

Topic: Methods of Calculating National Income

The three main methods of calculating National Income are the Expenditure method, the Output method, and the Income method. These methods measure national income in different ways:

• Expenditure method: Measures the total spending in the economy.


• Output method: Calculates the total value of goods and services produced in the economy.


• Income method: Focuses on the total income earned by individuals and businesses.

The Input method is not used for calculating National Income.

Explanation:

The correct answer is:

B. cost of living

Topic: Standard of Living

When the standard of living of a country improves, it usually means that people can afford more goods and services. This improvement is often linked to a fall in the cost of living. A lower cost of living allows people to buy more with their income, which leads to a higher standard of living.

Here's why the other answers are wrong:

• A. wage and salary levels: An increase in the standard of living doesn't necessarily mean a decrease in wages or salaries.


• C. demand for capital: Higher living standards don't directly affect the demand for capital.


• D. value of domestic currency: The value of currency may fluctuate due to other factors, but it's not directly tied to the standard of living in this way.

Explanation:

The correct answer is:

D. Transfer payment

Topic: National Income Measurement

A transfer payment is money given by the government to people, not in exchange for anything they produced. This can include things like unemployment benefits, pensions, or social security payments. These payments are included when measuring national income to show how money is distributed, but they do not directly relate to the production of goods and services.

Here’s why the other answers are wrong:

• A. tax-free income: This is money that is not taxed, but it doesn't relate to payments that aren't in exchange for services.


• B. per capita income: This is the average income per person in a country, not a type of payment.


• C. personal allowance payment: This is not a common term used to measure national income.

Explanation:

The correct answer is:

B. Raise interest rate on loans

Topic: Controlling Inflation

One way to control inflation is to raise the interest rate on loans. When interest rates go up, borrowing money becomes more expensive. This means people and businesses will borrow less, and they will spend less. As a result, there is less money flowing in the economy, which can help reduce prices and slow down inflation.

Here’s why the other answers are wrong:

• A. increase the minimum wage: Raising the minimum wage could actually increase inflation because people would have more money to spend, which can drive prices up.


• C. reduce personal income tax: Cutting taxes can increase people's spending, which can add to inflation.


• D. increase the supply of money: Increasing the amount of money in the economy can make inflation worse because it increases demand without increasing the supply of goods and services.

Explanation:

The correct answer is:

A. Price level

Topic: Value of Money

The price level is the best way to see how much money is worth in an economy. When the price level is low, money can buy more things. This means money is worth more. But when the price level goes up (inflation), money is worth less because it buys fewer things. So, changes in the price level show how the value of money is changing in the economy.

Here’s why the other answers are wrong:

• B. effective demand: This shows how much people want to buy, but it doesn't directly tell us the value of money.


• C. consumer's income: This shows how much money people earn, but it doesn't measure the value of money itself.


• D. effective supply: This is about how much is available to buy, not the value of money.

Explanation:

The correct answer is:

B. A reduction in the quantity of money in circulation

Topic: Causes of Inflation

Inflation happens when the prices of goods and services go up over time. A reduction in the amount of money in circulation helps stop inflation because it makes money harder to get. With less money around, people are less likely to buy too many things, which helps keep prices from rising too fast. So, reducing the supply of money can help control inflation by limiting how much people can spend.

Here’s why the other answers are wrong:

• A. deficit financing by the government: When the government spends more than it earns, it can actually increase inflation by putting more money into the economy.


• C. an upward review of salaries and wages: Raising salaries and wages can cause inflation because people will have more money to spend, which could push prices up.


• D. poor harvest by all farmers in a country: A poor harvest can cause prices of food to rise, but it doesn't directly control inflation in the economy as a whole.

Explanation:

The correct answer is:

D. Subsidy

Topic: Government Subsidies

A subsidy is money the government gives to producers to help lower their production costs. This makes it easier for producers to produce more goods, which can help lower prices for consumers. The aim is to make goods more affordable and ensure that there are enough supplies, especially for important products.

Here’s why the other answers are wrong:

• A. stabilization fund: This is a fund that helps stabilize the economy, but it isn't directly about reducing production costs or prices.


• B. tax: A tax increases costs for producers, which can lead to higher prices, not lower them.


• C. internal loan: This is money the government borrows from its own people or institutions, but it isn't a direct payment to producers to lower costs.

Explanation:

The correct answer is:

C. Value added tax (VAT)

Topic: Types of Taxes

Value added tax (VAT) is called a regressive tax because it takes a bigger percentage of income from people with lower incomes. This is because VAT is added to the price of goods and services, and people with lower incomes spend more of their money on these items than people with higher incomes. So, the tax takes up a larger share of their total income.

Here’s why the other answers are wrong:

• A. Income tax: This is usually progressive, meaning the more you earn, the higher percentage you pay.


• B. Company tax: This is a tax on business profits, not a tax on individuals, and it is not regressive.


• D. Pay-as-you-earn tax: This is typically a type of income tax, which is progressive, not regressive.

Explanation:

The correct answer is:

B. Capital market

Topic: Financial Markets

The capital market is where people buy and sell things like stocks and bonds, which are loans for a long time. This market helps companies and governments get money for big projects. The money market, on the other hand, is for short-term loans like savings accounts or treasury bills.

Here’s why the other answers are wrong:

• A. Money market: This market is for short-term loans, not long-term ones.


• C. Foreign exchange market: This market is for buying and selling currencies, not loans.


• D. Black market: This is an illegal market where things are sold without rules.

Explanation:

The correct answer is:

A. The government

Topic: Treasury Bills

Treasury bills (T-bills) are a way for the government to borrow money for a short time. The government sells them to people, and after a short time (usually less than a year), it pays back the money. This helps the government cover short-term expenses like paying off old debts or other needs.

Here’s why the other answers are wrong:

• B. Insurance companies: These companies don’t buy treasury bills to help the government raise money.


• C. The stock exchange: This is where stocks are traded, not where treasury bills are sold.


• D. Manufacturing industries: These industries don't buy treasury bills to raise money for the government.

Explanation:

The correct answer is:

D. Indirect tax

Topic: Government Revenue

Indirect taxes, like sales tax or VAT (value-added tax), are a big source of money for governments in developing countries. These taxes are easier to collect because they are added to the price of things people buy, not based on income or property. This is especially useful in countries where many people work in informal jobs (jobs that are not officially registered).

Here’s why the other answers are wrong:

• A. Income tax: This tax is based on how much money people earn, but it can be hard to collect in countries where many people don’t have formal jobs.


• B. Corporate tax: This tax is for businesses, but it is not as big a source of revenue in developing countries where there are fewer large businesses.


• C. Property tax: This tax is based on the value of property, but in developing countries, not everyone owns property, so it’s less common.

Explanation:

The correct answer is:

A. Progressive tax

Topic: Taxation

A progressive tax is based on the idea that people with more money should pay more taxes. So, the higher your income, the higher the percentage of your income you pay in taxes. This helps make sure that people with less money don’t pay as much, while those who can afford to pay more are taxed more.

Here’s why the other answers are wrong:

• B. Regressive tax: This tax takes a bigger percentage from lower-income people, which is the opposite of the 'ability to pay' idea.


• C. Proportional tax: This tax takes the same percentage from everyone, no matter how much money they make, so it doesn’t consider the ‘ability to pay’ idea.


• D. Sales tax: This is a flat tax added to goods and services, and it doesn’t consider how much money someone makes.

Explanation:

The correct answer is:

A. increase government expenditure in urban areas.

Topic: Rural-Urban Migration

When more people move from rural areas to cities, the population in cities grows. This means the government needs to spend more money on things like schools, hospitals, roads, and other services to keep up with the larger population. It can be hard for the government to provide enough services for everyone in crowded cities.

Here’s why the other answers are wrong:

• B. Reduce the population of urban areas: This is wrong because rural-urban migration actually increases the population in cities, not reduces it.


• C. Increase government revenue in rural areas: People moving to cities means fewer people left in rural areas to contribute taxes or revenue. So, this is not correct.


• D. Increase pressure on infrastructure in rural areas: When people move to cities, it takes the pressure off rural areas, not increases it. The pressure on services mostly increases in cities.

Explanation:

The correct answer is:

D. Inadequate statistical database

Topic: Development Planning in West Africa

In West Africa, problems like lack of money, shortage of skilled workers, and political instability are common when making development plans. But not having enough data or statistics is not usually seen as a big issue. Governments often struggle more with getting enough funds, workers, and stability, which affect how well development plans work.

Here’s why the other answers are wrong:

• A. Inadequate finance: Lack of money is a big problem for development planning because countries need funds to build infrastructure, provide services, and improve the economy.


• B. Inadequate supply of manpower: Having too few skilled workers or people with the right skills can make it hard to carry out development plans.


• C. Political instability: When governments are unstable or there is conflict, it makes it hard to make and follow through on development plans.

Explanation:

The correct answer is:

D. Salaries of workers

Topic: Financing Development Plans

Workers' salaries cannot be used to pay for a development plan. The money needed for development plans comes from things like borrowing from other countries, taxes paid by people, and aid or grants from other governments or organizations. Salaries are a cost of doing business and are needed to pay workers, not to fund big projects.

Here's why the other options are wrong:

• A. Borrowing from foreign countries: Countries can borrow money from other nations to finance development plans, which helps fund large projects like infrastructure.


• B. Taxes from citizens: Taxes collected from the public are one of the main ways governments finance development, as they provide regular income for the country.


• C. Aids and grants: Countries can also receive help from other countries or international organizations in the form of aid or grants, which can be used for development projects.

Explanation:

The correct answer is:

C. Balance of payments

Topic: International Transactions

The balance of payments is a report that shows all the financial deals a country has with other countries. It includes things like buying and selling goods, services, and money transfers. The balance of trade is part of this report, but it only looks at exports and imports. The balance of payments looks at all types of transactions.

Here’s why the other answers are wrong:

• A. Balance of trade: This only looks at the goods a country imports and exports, not all transactions with other countries.


• B. Development plan: This is a country's plan for improving its own economy, not for trade or transactions with other countries.


• D. National budget: This is about a country’s own money and spending, not its deals with other countries.

Explanation:

The correct answer is:

B. Payment for rice imports

Topic: Balance of Payments

Visible items in the balance of payments are things you can touch, like goods that are bought or sold. The payment for rice imports is a visible item because it is a deal about a physical product. Payments for services, like shipping or banking, are not visible items because they are not physical goods.

Here’s why the other answers are wrong:

• A. Payment for shipping services: Shipping is a service, not a product, so it's not a visible item.


• C. Receipt from coffee exports: This is about selling a product, but the question asks about payments for imports, not exports.


• D. Payment for banking services: Banking is a service, so it’s not a visible item.

Explanation:

The correct answer is:

A. An unfavourable terms of trade

Topic: Terms of Trade

If the price of imports is going up faster than the price of exports, the country ends up paying more for what it buys from other countries and earning less from what it sells. This makes the trade unfair, so it’s called an unfavourable terms of trade.

Here’s why the other answers are wrong:

• B. A favourable balance of payments: This is about a country's overall money flow, not about how trade prices are changing.


• C. An unfavourable balance of trade: The balance of trade only looks at imports and exports, but the question is asking about price changes, not the total balance.


• D. A favourable balance of trade: This would mean the country is doing well in trade, but the price of imports rising faster shows the opposite.

Explanation:

The correct answer is:

C. Tariffs and trade restrictions are removed

Topic: Free Trade Area

A free trade area is a group of countries that agree to get rid of tariffs (taxes on imports) and other rules that make trade harder. This means that goods and services can move more easily between the countries in the group. However, it doesn’t mean that all imports from outside the group are free from taxes, and it doesn’t guarantee that the countries will always make money from trade.

Here’s why the other answers are wrong:

• A. It does not allow free competition: A free trade area actually encourages competition by making it easier for countries to trade with each other.


• B. Imports from all countries are duty free: Only imports between countries in the free trade area are easier, not from all countries.


• D. Members are assured of their revenues: A free trade area doesn’t guarantee that countries will make money, it only makes trading easier.

Explanation:

The correct answer is:

C. Petrol and gas

Topic: Products from Crude Oil

Crude oil is turned into many products, like petrol (gasoline) and gas (natural gas). These products come from the process of refining crude oil. However, shea butter and olive oil come from plants, not from crude oil.

Here’s why the other answers are wrong:

• A. Gas and shea butter: Shea butter is not made from crude oil, it comes from plants.


• B. Olive oil and gas: Olive oil comes from olives, not crude oil.


• D. Kerosene and shea butter: Shea butter is not made from crude oil. Kerosene, however, can come from crude oil.