POST UTME BELLS UNIVERSITY 2018 Economics | Objective

Are you preparing for POST UTME BELLS UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2018 Economics (Objective) questions designed to simulate the real exam environment.

Practice these randomly selected questions to test your readiness.

Question 1
The concept of scarcity in economics implies that the production of one good is at the expense of another. What is the opportunity \cost of producing more wheat in Nigeria?
Correct A. The opportunity \cost is the value of the next best alternative good that could have been produced.
B. The opportunity \cost is the value of the next best alternative good that could have been consumed.
C. The opportunity \cost is the value of the next best alternative good that could have been traded.
D. The opportunity \cost is the value of the next best alternative good that could have been invested.

Correct Answer: A

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Question 2
A monopolist in Nigeria produces a good with a marginal \cost of ₦100 and a price of ₦150. What is the profit-maximizing quantity of the good?
A. 10 units
B. 20 units
Correct C. 30 units
D. 40 units

Correct Answer: C

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Question 3
The Nigerian government has implemented a policy to increase the production of rice. What is the effect of this policy on the supply curve of rice?
A. The supply curve shifts to the left.
Correct B. The supply curve shifts to the right.
C. The supply curve remains unchanged.
D. The supply curve shifts downward.

Correct Answer: B

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Question 4
A firm in Nigeria has a total revenue of ₦1,500 and a total \cost of ₦1,200. What is the profit of the firm?
Correct A. ₦300
B. ₦400
C. ₦500
D. ₦600

Correct Answer: A

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Question 5
The Nigerian government has implemented a policy to reduce the price of a good. What is the effect of this policy on the demand curve of the good?
A. The demand curve shifts to the left.
Correct B. The demand curve shifts to the right.
C. The demand curve remains unchanged.
D. The demand curve shifts upward.

Correct Answer: B

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Question 6
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, find the price at which the quantity demanded is 60 units.
A. ₦50
Correct B. ₦75
C. ₦100
D. ₦125

Correct Answer: B

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Question 7
A firm produces two products, A and B. The production function for product A is given by Q_A = 10L + 5K, where L is the labor input and K is the capital input. The production function for product B is given by Q_B = 8L + 3K. If the firm has 20 units of labor and 15 units of capital, find the total output of the firm.
A. 250
B. 300
Correct C. 350
D. 400

Correct Answer: C

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Question 8
The government of a country imposes a tax on a particular commodity. The supply function for the commodity is given by Q = 100 + 2P, where Q is the quantity supplied and P is the price. If the tax is ₦20 per unit, find the price at which the quantity supplied is 120 units.
A. ₦60
B. ₦80
C. ₦100
Correct D. ₦120

Correct Answer: D

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Question 9
A firm has a \cost function given by C = 100 + 2Q, where C is the total \cost and Q is the quantity produced. If the firm produces 50 units, find the total revenue.
A. ₦150
B. ₦200
C. ₦250
Correct D. ₦300

Correct Answer: D

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Question 10
The government of a country imposes a tax on a particular commodity. The demand function for the commodity is given by Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. If the tax is ₦20 per unit, find the price at which the quantity demanded is 60 units.
A. ₦50
Correct B. ₦75
C. ₦100
D. ₦125

Correct Answer: B

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Question 11
A monopolistically competitive firm faces a demand curve with a cons\tant elasticity of -2. If the firm's marginal revenue (MR) is 100, and its marginal \cost (MC) is 80, what is the firm's optimal output level?
A. 100 units
B. 120 units
Correct C. 150 units
D. 200 units

Correct Answer: C

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Question 12
A consumer has a budget of ₦10,000 and faces the following price and quantity combinations for two goods: Good X: ₦2,000 per unit, Good Y: ₦3,000 per unit. If the consumer's indifference curves are convex to the origin, what is the optimal combination of goods X and Y?
A. Buy 2 units of Good X and 1 unit of Good Y
B. Buy 3 units of Good X and 0 units of Good Y
Correct C. Buy 1 unit of Good X and 2 units of Good Y
D. Buy 0 units of Good X and 3 units of Good Y

Correct Answer: C

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Question 13
A firm is facing a downward-sloping demand curve with a cons\tant elasticity of -1.5. If the firm's marginal revenue (MR) is 120, and its marginal \cost (MC) is 100, what is the firm's optimal price level?
A. ₦1,000
Correct B. ₦1,200
C. ₦1,500
D. ₦2,000

Correct Answer: B

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Question 14
A consumer has a budget of ₦5,000 and faces the following price and quantity combinations for two goods: Good X: ₦1,000 per unit, Good Y: ₦2,000 per unit. If the consumer's indifference curves are convex to the origin, what is the optimal combination of goods X and Y?
A. Buy 2 units of Good X and 1 unit of Good Y
B. Buy 3 units of Good X and 0 units of Good Y
Correct C. Buy 1 unit of Good X and 2 units of Good Y
D. Buy 0 units of Good X and 2 units of Good Y

Correct Answer: C

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Question 15
A firm is facing a downward-sloping demand curve with a cons\tant elasticity of -2. If the firm's marginal revenue (MR) is 150, and its marginal \cost (MC) is 120, what is the firm's optimal output level?
A. 100 units
B. 120 units
Correct C. 150 units
D. 200 units

Correct Answer: C

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Question 16
The production function is given by Q = 100K^\( 1/2 \)L^\( 1/2 \). If the scale of production is increased by a factor of 4, what is the new production function?
Correct A. Q = 400K^\( 1/2 \)L^\( 1/2 \)
B. Q = 100K^\( 1/2 \)L^\( 1/2 \)
C. Q = 200K^\( 1/2 \)L^\( 1/2 \)
D. Q = 50K^\( 1/2 \)L^\( 1/2 \)

Correct Answer: A

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Question 17
The GDP of a country is ₦100 billion. If the population is 20 million, what is the per capita GDP?
Correct A. ₦5,000
B. ₦10,000
C. ₦20,000
D. ₦50,000

Correct Answer: A

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Question 18
The government of a country has set a target of increa\sing the GDP by 10% within the next 5 years. If the current GDP is ₦100 billion, what is the new GDP target?
A. ₦110 billion
Correct B. ₦120 billion
C. ₦130 billion
D. ₦140 billion

Correct Answer: B

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Question 19
The production function is given by Q = 100K^\( 1/2 \)L^\( 1/2 \). If the scale of production is increased by a factor of 4, what is the new production function?
Correct A. Q = 400K^\( 1/2 \)L^\( 1/2 \)
B. Q = 100K^\( 1/2 \)L^\( 1/2 \)
C. Q = 200K^\( 1/2 \)L^\( 1/2 \)
D. Q = 50K^\( 1/2 \)L^\( 1/2 \)

Correct Answer: A

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Question 20
The government of a country has set a target of increa\sing the GDP by 10% within the next 5 years. If the current GDP is ₦100 billion, what is the new GDP target?
A. ₦110 billion
Correct B. ₦120 billion
C. ₦130 billion
D. ₦140 billion

Correct Answer: B

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Question 21
Suppose 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 supply of the product is given by the equation Qs = 2P - 50, where Qs is the quantity supplied, find the equilibrium price and quantity.
A. ₦50
Correct B. ₦75
C. ₦100
D. ₦125

Correct Answer: B

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Question 22
A firm's production function is given by Q = 2L^2 + 5K, where Q is the output, L is the labor and K is the capital. If the firm has 10 units of labor and 5 units of capital, find the output.
A. 50
B. 75
Correct C. 100
D. 125

Correct Answer: C

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Question 23
A consumer has a budget of ₦1000 and has the following preferences: 2 units of good A \cost ₦200, 3 units of good B \cost ₦300, and 4 units of good C \cost ₦400. If the consumer wants to maximize utility, how many units of each good should the consumer buy?
Correct A. 2A, 3B, 4C
B. 3A, 2B, 1C
C. 1A, 2B, 3C
D. 4A, 1B, 2C

Correct Answer: A

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Question 24
A firm's demand function is given by Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. If the firm's supply function is given by Qs = 2P - 50, where Qs is the quantity supplied, find the elasticity of demand at the equilibrium price.
A. 0.5
Correct B. 1
C. 2
D. 3

Correct Answer: B

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Question 25
A consumer has a budget of ₦1000 and has the following preferences: 2 units of good A \cost ₦200, 3 units of good B \cost ₦300, and 4 units of good C \cost ₦400. If the consumer wants to maximize utility, what is the marginal rate of substitution between good A and good B?
A. 1
Correct B. 2
C. 3
D. 4

Correct Answer: B

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