Welcome to AllCBTs. In today’s tutorial, we’ll explore some highly probable JAMB Economics questions for 2026. If you’re preparing for the upcoming exam, these solved questions and explanations will give you the clarity and strategy needed to tackle JAMB confidently.
Let’s dive into the concepts and their real-world applications.
You can watch the full class in the video below:
Question 1: What Is Marginal Cost?
Question:
Marginal cost refers to:
A) The lowest cost of producing goods
B) The cost of production of the most efficient firm in an industry
C) The cost of production of the most inefficient firm in an industry
D) The cost of producing one additional unit of goods
Correct Answer: D – The cost of the last extra unit of goods produced by a firm
Explanation:
Marginal cost represents the additional cost incurred when producing one more unit of a good. It’s not about the average or total cost, but the cost of the “next” unit. This concept is fundamental in determining output levels and pricing decisions.
Question 2: Understanding the Price Mechanism
Question:
What does the price mechanism do in a capitalist economy?
A) Regulates supply and demand
B) Regulates consumers
C) Rewards producers
D) Allocates resources
E) All of the above
Correct Answer: A – Regulates supply and demand
Explanation:
The price mechanism, also known as the price system, plays a vital role in capitalist economies. It refers to how prices are determined by the interaction of demand and supply, also known as the “invisible hand” of the market. It ensures equilibrium and automatically adjusts resource allocation based on scarcity and preferences.
Question 3: Rationing of Scarce Goods in a Free Market
Question:
In a free market economy, the rationing of scarce goods is mainly done by:
A) The Government
B) Business Organizations
C) The Price Mechanism
D) Consumers
Correct Answer: C – The Price Mechanism
Explanation:
In a free market, resources are allocated and goods are rationed not by decree or planning, but by prices. When goods are scarce, prices rise, which discourages overconsumption and directs goods to those most willing to pay. The price mechanism ensures efficient distribution without central authority.
Watch more educational videos and past questions: https://youtube.com/@allcbts
Why These Topics Are Critical for JAMB Economics
These questions touch on core areas of the JAMB Economics syllabus:
- Microeconomics concepts like marginal cost and efficiency
- Market structures and capitalism
- Functions of price in economic systems
By understanding these clearly, you gain confidence in answering related theory and multiple-choice questions.
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Get ready for JAMB Economics 2026 with this expert tutorial covering marginal cost, price mechanism, and rationing in free markets. Includes exam-style questions and full explanations.
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