POST UTME ACHIEVERS UNIVERSITY 2019 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's input prices are w_L = ₦100 and w_K = ₦200, and the firm's output price is P = ₦500, what is the firm's optimal input combination?
A. L = 100, K = 100
B. L = 200, K = 200
C. L = 300, K = 300
D. L = 400, K = 400
Question 2
The following diagram shows a perfectly competitive market with two firms, A and B. If firm A increases its price from ₦100 to ₦120, what will be the effect on firm B's output?
A. Increase
B. Decrease
C. No change
D. Uncertain
Question 3
Consider an economy with a money supply of \( M = 1000 \) and a velocity of money \( V = 5 \). If the price level is \( P = 10 \), find the real money supply.
A. ( 50 )
B. ( 100 )
C. ( 200 )
D. ( 500 )
Question 4
A firm has a budget constraint of 100 units of labor and 50 units of capital. If the price of labor is ₦50 and the price of capital is ₦100, what is the opportunity \cost of labor?
A. ₦50
B. ₦100
C. ₦150
D. ₦200
Question 5
The government of Nigeria has introduced a new policy to increase the production of rice. The policy includes a subsidy of 10% on the \cost of production. If the \cost of production is 100, find the new \cost of production.
A. ₦90
B. ₦100
C. ₦110
D. ₦120
Question 6
A country has a tax rate of 20% on a good. If the price of the good is ₦100, what is the price paid by the consumer?
A. ₦80
B. ₦90
C. ₦100
D. ₦110
Question 7
A government in Nigeria is planning to implement an economic development project. If the project has a high opportunity \cost, what should the government do?
A. Implement the project
B. Abandon the project
C. Postpone the project
D. Modify the project
Question 8
In a perfectly competitive market, if the demand for a commodity increases, what happens to the equilibrium price and quantity?
A. The equilibrium price increases and the equilibrium quantity decreases
B. The equilibrium price decreases and the equilibrium quantity increases
C. The equilibrium price remains the same and the equilibrium quantity increases
D. The equilibrium price increases and the equilibrium quantity increases
Question 9
A farmer in Nigeria decides to cultivate a new crop. If the opportunity \cost of cultivating the new crop is higher than the opportunity \cost of cultivating the existing crop, what will happen to the farmer's production?
A. The farmer's production will increase
B. The farmer's production will decrease
C. The farmer's production will remain the same
D. The farmer's production will increase at a slower rate
Question 10
The demand for a product is given by the equation Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. If the price elasticity of demand is 0.5, what is the percentage change in quantity demanded when the price increases by 10%?
A. 5%
B. 10%
C. 15%
D. 20%
Question 11
A consumer has a budget of ₦1000 and the prices of two goods are ₦200 and ₦300. If the consumer buys 2 units of the first good, how many units of the second good can the consumer buy?
A. 2 units
B. 3 units
C. 4 units
D. 5 units
Question 12
A firm's marginal revenue is given by the equation MR = 100 - 2x, where x is the number of units sold. Find the value of x that maximizes MR.
A. 10
B. 20
C. 30
D. 40
Question 13
The government of a country wants to reduce the unemployment rate from 10% to 5% in the next two years. If the current GDP is ₦10 trillion and the government plans to increase it by 5% each year, what is the total amount of money the government needs to sp\end to achieve its goal?
A. ₦1 trillion
B. ₦2 trillion
C. ₦3 trillion
D. ₦4 trillion
Question 14
A firm is facing a demand curve ( D(p) = 100 - 2p ) and a supply curve ( S(p) = 20 + 5p ). If the firm's marginal revenue is ( MR(p) = 100 - 4p ), find the profit-maximizing price and quantity.
A. \( p = 15, q = 35 \)
B. \( p = 20, q = 30 \)
C. \( p = 25, q = 25 \)
D. \( p = 30, q = 20 \)
Question 15
A firm in Nigeria is producing a commodity with a production function Q = 2L^0.5K^0.5. If the price of the commodity is ₦100 and the wage rate is ₦50, what is the profit-maximizing level of labor?
A. 10
B. 20
C. 30
D. 40

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