JAMB UTME - Economics - 1992 | Green Bridge CBT

Question 1 Report

Because most of her crude oil is exported, the foreign exchange earnings and the forward linkage effects Nigeria realize from her oil production are?

both high

respectively high and low Correct answer

respectively low and high

both low

Answer Details

Nigeria is a major oil-producing country, and as a result, earns a significant amount of foreign exchange from the export of crude oil. The forward linkage effects refer to the various economic activities that result from the production and export of oil, such as job creation, infrastructure development, and technological advancements. Because most of Nigeria's crude oil is exported, it means that the foreign exchange earnings are high. However, the forward linkage effects may not be as high as they could be, since much of the oil production is controlled by multinational corporations rather than local Nigerian companies. Therefore, the answer is "respectively high and low."

Read lesson note on Petroleum And The Nigerian Economy (JAMB)






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