POST UTME ACHIEVERS UNIVERSITY 2025 Economics | Objective

Are you preparing for POST UTME ACHIEVERS UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2025 Economics (Objective) questions designed to simulate the real exam environment.

Practice these randomly selected questions to test your readiness.

Question 1
A consumer's indifference curve is given by the equation ( u(x,y) = 2x + 3y ). If the consumer's income is ₦1000 and the prices of x and y are ₦5 and ₦3 respectively, what is the consumer's optimal bundle of x and y?
Correct A. (20, 10)
B. (15, 15)
C. (10, 20)
D. (5, 30)

Correct Answer: A

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Question 2
A firm's \cost function is given by ( C(q) = 2q^2 + 10q + 5 ). If the firm's revenue function is ( R(q) = 4q^2 - 2q + 1 ), what is the firm's profit-maximizing quantity?
A. 5
Correct B. 10
C. 15
D. 20

Correct Answer: B

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Question 3
A country's balance of payments account is given by the following table:\n\n| | Exports | Imports | Balance |\n| --- | --- | --- | --- |\n| 2020 | ₦1000 | ₦800 | ₦200 |\n| 2021 | ₦1200 | ₦900 | ₦300 |\n| 2022 | ₦1500 | ₦1000 | ₦500 |\n\nWhat is the country's balance of payments surplus for the three-year period?
A. ₦1100
B. ₦1200
Correct C. ₦1300
D. ₦1400

Correct Answer: C

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Question 4
A central bank uses the following monetary policy tools to control inflation:\n\n| Tool | Effect on Inflation |\n| --- | --- | --- |\n| Open Market Operations | Reduces inflation |\n| Reserve Requirements | Reduces inflation |\n| Discount Rate | Increases inflation |\n\nWhat is the effect of increa\sing the discount rate on inflation?
A. Reduces inflation
Correct B. Increases inflation
C. Has no effect on inflation
D. Decreases inflation

Correct Answer: B

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Question 5
A country's economic development plan aims to increase its GDP growth rate from 2% to 5% per annum. If the country's current GDP is ₦100 billion, what is the expected GDP in 5 years?
A. ₦150 billion
B. ₦175 billion
C. ₦200 billion
Correct D. ₦225 billion

Correct Answer: D

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Question 6
Consider a firm operating in a perfectly competitive market with a production function Q = 2L^0.5K^0.5. If the firm's current input prices are w = ₦100 and r = ₦200, and it currently employs 4 units of labor and 9 units of capital, what is the firm's current total \cost of production?
A. ₦1,200
B. ₦1,500
Correct C. ₦1,800
D. ₦2,000

Correct Answer: C

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Question 7
A country's balance of payments account shows a trade deficit of ₦500 billion, a current account deficit of ₦300 billion, and a capital account surplus of ₦200 billion. What is the country's overall balance of payments position?
A. ₦100 billion surplus
Correct B. ₦200 billion deficit
C. ₦300 billion deficit
D. ₦500 billion deficit

Correct Answer: B

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Question 8
A firm's production function is given by Q = 3L^0.7K^0.3. If the firm's current input prices are w = ₦150 and r = ₦250, and it currently employs 6 units of labor and 8 units of capital, what is the firm's current total \cost of production?
A. ₦2,400
B. ₦2,800
Correct C. ₦3,200
D. ₦3,600

Correct Answer: C

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Question 9
A country's GDP is ₦5 trillion, its GNP is ₦4.5 trillion, and its net factor income from abroad is ₦100 billion. What is the country's national income?
A. ₦4.6 trillion
B. ₦4.7 trillion
Correct C. ₦4.8 trillion
D. ₦4.9 trillion

Correct Answer: C

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Question 10
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's current input prices are w = ₦120 and r = ₦220, and it currently employs 5 units of labor and 7 units of capital, what is the firm's current total \cost of production?
A. ₦1,800
B. ₦2,200
Correct C. ₦2,600
D. ₦2,800

Correct Answer: C

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Question 11
A firm's revenue function is given by R(x) = 2x^2 + 5x + 1, where x is the number of units produced. If the firm's marginal revenue is 10 when x = 3, what is the value of the firm's total revenue at x = 5?
A. ₦1250
B. ₦1500
C. ₦1750
Correct D. ₦2000

Correct Answer: D

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Question 12
A consumer's budget constraint is given by the equation 2y + 3x = 12, where x is the number of units of good X and y is the number of units of good Y. If the consumer's indifference curve is given by the equation y = 2x^2 + 5x + 1, what is the consumer's optimal consumption bundle?
A. x = 1, y = 2
Correct B. x = 2, y = 3
C. x = 3, y = 4
D. x = 4, y = 5

Correct Answer: B

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Question 13
A firm's supply function is given by Q = 2P^2 + 5P + 1, where P is the price of the good. If the firm's marginal \cost is 10 when P = 3, what is the firm's optimal price?
A. ₦10
B. ₦20
Correct C. ₦30
D. ₦40

Correct Answer: C

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Question 14
A consumer's indifference curve is given by the equation y = 2x^2 + 5x + 1, where x is the number of units of good X and y is the number of units of good Y. If the consumer's budget constraint is given by the equation 2y + 3x = 12, what is the consumer's optimal consumption bundle?
A. x = 1, y = 2
Correct B. x = 2, y = 3
C. x = 3, y = 4
D. x = 4, y = 5

Correct Answer: B

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Question 15
A firm's revenue function is given by R(x) = 2x^2 + 5x + 1, where x is the number of units produced. If the firm's marginal revenue is 10 when x = 3, what is the firm's total revenue at x = 5?
A. ₦1250
B. ₦1500
C. ₦1750
Correct D. ₦2000

Correct Answer: D

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Question 16
A perfectly competitive firm in the short run will produce where its marginal \cost (MC) is equal to its marginal revenue (MR). However, in the long run, the firm will produce where its average total \cost (ATC) is minimized. Which of the following best describes the relationship between the firm's short-run and long-run production decisions?
A. The firm will produce at a higher quantity in the long run than in the short run.
Correct B. The firm will produce at a lower quantity in the long run than in the short run.
C. The firm will produce at the same quantity in the long run as in the short run.
D. The firm will produce at a quantity that is between the short-run and long-run quantities.

Correct Answer: B

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Question 17
A monopolist faces a demand curve with the following equation: Qd = 100 - 2P. The monopolist's marginal \cost (MC) is cons\tant at 10. What is the monopolist's optimal price and quantity?
Correct A. P = 40, Q = 30
B. P = 50, Q = 25
C. P = 60, Q = 20
D. P = 70, Q = 15

Correct Answer: A

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Question 18
A farmer in Nigeria produces maize and soybeans on a 100-hectare farm. The farmer's production function for maize is Qm = 100x^\( 1/2 \), where x is the number of hectares allocated to maize production. The farmer's production function for soybeans is Qs = 50x^\( 1/3 \), where x is the number of hectares allocated to soybeans production. If the farmer allocates 60 hectares to maize production and 40 hectares to soybeans production, what is the total output of maize and soybeans?
A. Qm = 100, Qs = 50
Correct B. Qm = 120, Qs = 60
C. Qm = 150, Qs = 70
D. Qm = 180, Qs = 80

Correct Answer: B

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Question 19
A government in Nigeria is considering a policy to increase agricultural production. The government's goal is to increase the country's agricultural output by 20% within the next 5 years. Which of the following policies would be most effective in achieving this goal?
A. Increa\sing the price of fertilizers to encourage farmers to use more efficient farming practices.
B. Providing subsidies to farmers to purchase new farming equipment.
Correct C. Implementing a program to educate farmers on new farming techniques.
D. Increa\sing the amount of land allocated to agricultural production.

Correct Answer: C

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Question 20
A firm in Nigeria is considering a new investment project. The firm's \cost of capital is 10%, and the project's expected return is 12%. What is the net present value (NPV) of the project?
A. NPV = 100,000
Correct B. NPV = 120,000
C. NPV = 150,000
D. NPV = 180,000

Correct Answer: B

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Question 21
A consumer in Nigeria has a budget of ₦10,000 and a demand curve for a good with the following equation: Qd = 100 - 2P. The consumer's income is ₦5,000, and the price of the good is ₦2,000. What is the consumer's optimal quantity of the good?
Correct A. Q = 20
B. Q = 30
C. Q = 40
D. Q = 50

Correct Answer: A

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Question 22
A firm in Nigeria is facing a perfectly competitive market. The firm's marginal \cost (MC) is cons\tant at ₦5, and the market price is ₦10. What is the firm's optimal quantity of production?
A. Q = 2
B. Q = 3
C. Q = 4
Correct D. Q = 5

Correct Answer: D

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Question 23
A consumer in Nigeria has a budget of ₦5,000 and a demand curve for a good with the following equation: Qd = 100 - 2P. The consumer's income is ₦2,000, and the price of the good is ₦1,000. What is the consumer's optimal quantity of the good?
Correct A. Q = 20
B. Q = 30
C. Q = 40
D. Q = 50

Correct Answer: A

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Question 24
The returns to scale in a production function can be classified into three types: increa\sing, decrea\sing, and cons\tant. Which of the following production functions exhibits cons\tant returns to scale?
Correct A. Q = 2K^2L^2
B. Q = 2K^2L
C. Q = 2KL^2
D. Q = 2K^2L^2 + 3KL^2

Correct Answer: A

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Question 25
A firm's production function is given by Q = 2K^2L^2. If the firm's capital stock increases by 20% and labor increases by 10%, what is the percentage change in output?
Correct A. 30%
B. 20%
C. 10%
D. 40%

Correct Answer: A

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