CLASS MEDICINE

TUTORIAL QUESTION

QUESTION 1 
The table below represents a travelers consumption of bottles of cocoa-cola.Study the table carefully and answer the questions that follow.
(i) complete the missing figures D,E,F,G,and H
(ii)Draw the demand curve for the traveller,s consumption of coca- cola.
(iii) Explain the law of diminishing marginal utility as the basis of slope of the traveller,s demand curve.

SOLUTION

(i)To calculate D(Total utility)
Tu4=Tu3+Mu4
       =42+12
       = 54
To calculate E(Total utility)
Tu7=Tu6+Mu7
       =75+0
        =75
To calculate F(Marginal utility)
     Mu5=Tu2-Tu1
             =29-15
             =14
To calculate G(Marginal utility)
     Mu5=Tu5-Tu4
             =65-54
              =11
To calculate H(Marginal utility)
Mu6=Tu6-Tu5
        =75-65
        =10
(ii)To draw the demand curve
(iii) According to the law ,marginal utility falls when quantity consumed increases.At Equilibrium M=P hence for my to fall,the price must fall to encourage the consumer more.ln other words as the price fall the quantity demanded increases as illustrated in the demand curve.

QUESTION 2
Middle men do encounter problems in the process of carrying out their business. Explain.

SOLUTION
  1. Market: In some occasions, they may find it difficult to sell their products.
  2. Price controller: Prices are seldom fixed by the government without considering what it takes to buy such goods by the middlemen.
  3. Transportation: Many rural areas or towns do not have good road network to transport goods.
  4. Poor Storage Facilities: This makes goods bought and stored by the middlemen to get rotten before they are distributed.
  5. Information about the Location of a product may not be adequate.
  6. May Middlemen: Too many Middlemen may pose serious problem in the distribution and marketing of commodities.
QUESTION 3
Outline the merit of Joint Stock Company.

SOLUTION
  1. Large Capital: Joint stock company can easily raise capital through the sale of shares to all public.
  2. Mass Production: Such large capital enables it to engage in mass production of goods.
  3. Limited Liability: The share holders cannot lose more than the money they have invested in buying shares. 
  4. Continuity: The life of a joint stock company is not affected by a shareholders death.
  5. Employment of qualified personnel: It can afford to engage qualified personnel as engineer, economist, accountant, etc. because of the huge capital at its disposal.
QUESTION 4
Give five reasons why Government participates in business enterprise?

SOLUTION
  1. To provide capital: Some business require huge amount of capital which individuals may not be able to afford, hence government involvement.
  2. For employment opportunity: Government may participate in business enterprise in order to provide employment opportunities to the working population of a country.
  3. For rapid economic development: The presence of government in the economic activities attracts both local and foreign investors and hasten the development of a country.
  4. To avoid foreign control of the economy.
  5. Prevention of exploitation: If private enterprises are allowed to render the essential services, there will be exploitation and discrimination in their provision
QUESTION 5

Why is the small-scale trader important in West Africa countries?

SOLUTION
  1. He gives personal treatment as medical services.
  2. He provides direct services such as those of the mechanics and lawyers, etc.
  3. He provides goods and services where the market for the product is small.
  4. He also has very low cost: Hawkers, do not need to pay high rent or salary to any landlord or worker.
  5. He renders services to the big firms such as providing canteens for their workers or repairing machines.
  6. He meets specific taste of customers. A good example is the tailoring business.
QUESTION 6
 
(a) What is a customs union?
(b) State three awdvantages and two disadvantages of a customs union.

SOLUTION
(a) A custom union is an association of some countries that promotes free trade and elimination of barriers (as tariffs) in the international trade.

(b) Advantages of the Custom union
  • It increases total world population of goods and services.
  • Efficiency of a country's natural and human resources.
  • It promotes world peace: Two countries in the same organization rarely engage in conflict.
Disadvantages of the Custom union
  • It reduces government revenue: Money that should accrue to the government is foregone.
  • It may lead to importation of harmful goods in the name of association.

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