POST UTME BELLS UNIVERSITY 2020 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A country's balance of payments is given by the following equation: \( BOP = X - M \), where (X) is the value of exports and (M) is the value of imports. If the country's exports are (₦100) billion and its imports are (₦120) billion, what is the country's balance of payments?
A. (₦20) billion surplus
B. (₦20) billion deficit
C. (₦40) billion surplus
D. (₦40) billion deficit
Question 2
A firm's production function is given by Q = 2L^2 + 3K. If the firm's \cost function is C(L,K) = 2L + 3K, what is the firm's profit-maximizing level of L and K?
A. (5, 5)
B. (10, 10)
C. (15, 15)
D. (20, 20)
Question 3
A country's government is considering implementing a value-added tax (VAT) to increase revenue. If the VAT rate is 10% and the average price of a good is ₦100, what is the amount of VAT paid by consumers?
A. ₦10
B. ₦20
C. ₦50
D. ₦100
Question 4
Consider a firm operating in a perfectly competitive market. If the firm's marginal revenue (MR) curve intersects its marginal \cost (MC) curve at point E, where MR = MC, and the firm's average revenue (AR) curve is downward sloping, what can be concluded about the firm's output level?
A. The firm is producing at its maximum profit level.
B. The firm is producing at its minimum profit level.
C. The firm is producing at its break-even point.
D. The firm is producing at its maximum loss level.
Question 5
A country's GDP is calculated as the sum of its consumption, investment, government sp\ending, and net exports. If the country's GDP is $100 billion, and its consumption is $60 billion, its investment is $15 billion, its government sp\ending is $10 billion, and its net exports are $5 billion, what is the country's net exports as a percentage of its GDP?
A. 5%
B. 10%
C. 15%
D. 20%
Question 6
A firm's production function is given by Q = 2L^\( 1/2 \)K^\( 1/2 \), where Q is output, L is labor and K is capital. If the firm's current labor and capital inputs are 16 and 9 respectively, what is the marginal product of capital?
A. 1/4
B. 1/2
C. 1
D. 2
Question 7
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's current inputs are L = 16 and K = 9, what is the marginal product of labor?
A. 2
B. 3
C. 4
D. 5
Question 8
In a perfectly competitive market, the demand curve for a firm's product is horizontal and the supply curve is upward-sloping. What is the equilibrium price and quantity of the product?
A. \( P = 10, Q = 100 \)
B. \( P = 20, Q = 50 \)
C. \( P = 15, Q = 75 \)
D. \( P = 25, Q = 25 \)
Question 9
A firm is considering investing in a new project with a payback period of 5 years. If the firm's \cost of capital is 12%, what is the internal rate of return (IRR) of the project?
A. 10%
B. 12%
C. 15%
D. 18%
Question 10
A perfectly competitive firm's supply curve is a
A. Horizontal line
B. Vertical line
C. U-shaped curve
D. L-shaped curve
Question 11
A firm's demand curve is given by Q = 100 - 2P. If the firm's current price is ₦20, what is the elasticity of demand?
A. 0.5
B. 1
C. 2
D. 3
Question 12
A firm's demand curve is given by Q = 100 - 2P, where Q is quantity demanded and P is price. If the firm's current price is 20, what is the quantity demanded?
A. 40
B. 60
C. 80
D. 100
Question 13
In a perfectly competitive market, the equilibrium price and quantity are determined by the intersection of the supply and demand curves. If the demand curve shifts to the left, what will happen to the equilibrium price and quantity?
A. The equilibrium price will decrease, and the equilibrium quantity will increase.
B. The equilibrium price will increase, and the equilibrium quantity will decrease.
C. The equilibrium price will remain the same, and the equilibrium quantity will remain the same.
D. The equilibrium price will decrease, and the equilibrium quantity will decrease.
Question 14
A firm is considering investing in a new project. The project has a net present value (NPV) of ₦1,500,000. If the \cost of capital is 10%, what is the internal rate of return (IRR) of the project?
A. 12%
B. 15%
C. 18%
D. 20%
Question 15
A central bank is considering a monetary policy to reduce inflation. The inflation rate is given by the equation \( π = 2 + 0.1Y \), where (Y) is the level of economic activity. If the central bank wants to reduce the inflation rate to 2%, what level of economic activity is required?
A. \( Y = 100 \)
B. \( Y = 200 \)
C. \( Y = 300 \)
D. \( Y = 400 \)

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