2019 - JAMB Economics Past Questions and Answers - page 1

 A normal demand lower price more will be demand but Abnormal demand curve slopes upward from left to right indications, It higher price more will be demanded which give reverse. A normal demand curve slopes downward from left to right indication. 

A change in the price of refrigerator and bicycle has no effect on each other. A change in the price of refrigerator will have not affect the bicycle since they are not related. The two goods are independent goods. 

NOTE : The elasticity of demand is always positive. Therefore, the negative sigin is ignored or extra negetive sign is introduced to make it postive.

The elasticity of demand is calculated using:

Where P = Price
Q = Quantity Demanded

Therefore,

= -25%
 

= 20%
 

The answer is 1.25

The Demand and Supply determined the price the firm can sell any quantity it wishes, Since the buyers or sellers cannot influence the price of goods and services. 

The short-run monopoly sells OM output at MP (OB) price. The total monopoly profits are AP × CA = CAPB is shaded in the diagram.
CAPB indicates Abnormal profit of the monopolist.

Short-runs is s period where some factors are fixed,while some are variable. 

An economy in which the income is shared between consumption and saving or consumption and investment i.e
γ = c + s or γ = C + I 

It is known as frugal economy.