Cameroon GCE advanced level June 2026 economics 1

Master GCE Economics: Advanced Level MCQ Revision Bank

Earning an “A” grade in your Cameroon GCE Advanced Level Economics paper requires deep analytical accuracy, calculation precision, and a strong understanding of market structures.

Below is a complete revision set of 10 essential multiple-choice questions compiled from image_77b18a.jpg. This selection spans fundamental microeconomic and macroeconomic syllabus areas, including cost theory calculations, financial capital structures, currency devaluation (Marshall-Lerner condition), elasticity formulas, and market equilibrium. Take the test below to see if you can solve them!

Advanced Level Economics Multiple Choice Questions

1. An increase in money national income will only lead to an improvement in the standard of living when:

• A the economy experiences a high rate of inflation.

• B the economy experiences deflation.

• C more goods are directed for foreign investment.

• D there is more investment in the country.

2. A firm has the following cost structure:

What is the AVC of the firm if 5 units of output are produced?

• A 45,000 FCFA.

• B 90,000 FCFA.

• C 70,000 FCFA.

• D 20,000 FCFA.

3. A Company’s capital structure is as follows:

• 1,000 9% debentures at 1000 FCFA each

• 1,000 20% Preference shares at 2000 FCFA each

• 3,000 ordinary shares at 1000 FCFA each

Calculate the equity for this Company.

• A 1,000,000 FCFA.

• B 2,000,000 FCFA.

• C 3,000,000 FCFA.

• D 6,000,000 FCFA.

4. A mixed economy has:

• A elements of both supply and demand.

• B market forces and government intervention.

• C more positive than negative externalities.

• D more negative than positive externalities.

5. If the price elasticity of demand for exports is 0.6, devaluation of a currency will best cure a balance of payments deficit when the price elasticity of demand for imports is:

• A 0.2

• B 0.4

• C 0.6

• D 0.8

Question 6 is based on Figure 1 below.

  Price
 (FCFA)
    ^
120 | \           / S_0
    |  \         /
110 |...\-------/----/ S_1
    |    \     /    /
100 |-----\---/----+
 90 |......\ /.....|
    |       X      |
  0 +-------|------|---------->
            |      |   Quantity

6. What is the supply price after the granting of the subsidy?

• A 90 FCFA.

• B 100 FCFA.

• C 110 FCFA.

• D 120 FCFA.

7. What term is used when short term government bonds are converted into stocks?

• A Open market operations.

• B Quantitative controls.

• C Special deposits.

• D Funding.

8. The Public Sector Net Cash requirement (PSNCR) is the combined deficit of the:

• A central and local governments.

• B central government and local governments.

• C public corporations and local governments.

• D central government, local government and public corporations.

9. The income elasticity of demand for a product is 3. Assume the percentage change in income is 5%, calculate the percentage change in quantity demanded.

• A 3%

• B 10%

• C 15%

• D 20%

10. A firm under monopoly will be in equilibrium in the long run when:

• A MC = MR and AC = AR.

• B MC = MR and AR > AC.

• C MC = MR and AC > AR.

• D MC = MR and AR < AC.

Revision Strategy Tips for These Questions

• Mind the Fixed Costs (Question 2): To find the Average Variable Cost (AVC), remember that at output 0, Total Cost (TC) is 100. This is your Total Fixed Cost (TFC). At 5 units, Variable Cost (VC) equals $\text{TC} – \text{TFC} = 450 – 100 = 350$. Don’t forget that the values are listed in thousands (000 FCFA), making it 350,000 FCFA. Divide that by 5 units to arrive at your answer!

• The Marshall-Lerner Rule (Question 5): A currency devaluation successfully corrects a balance of payments deficit only if the sum of the price elasticities of demand for exports and imports is greater than 1 ($\epsilon_x + \epsilon_m > 1$). Since export elasticity is 0.6, your import elasticity needs to push the total above 1.0!

Challenge Your Peer Study Group: Drop your calculations and final answers in the comments section below! Let’s cross-check your reasoning and answers together. For deeper offline practice with comprehensive answers, open up your Kawlo Application!