POST UTME CALEB UNIVERSITY 2021 Economics | Objective

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Question 1 View Details
A government imposes a tax on imports to reduce the trade deficit. However, the tax leads to a decrease in the quantity of imports. What is the opportunity \cost of this tax?
A. The decrease in the quantity of imports
B. The increase in the price of imports
Correct C. The loss of consumer surplus
D. The loss of government revenue

Correct Answer: C

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Question 2 View Details
A monopolist faces a demand curve with the following equation: \( Q = 100 - 2P \). If the monopolist's marginal \cost is \( MC = 10 \), what is the profit-maximizing price?
A. ₦50
Correct B. ₦75
C. ₦100
D. ₦125

Correct Answer: B

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Question 3 View Details
A country's balance of payments is in equilibrium when the current account is equal to the capital account. If the current account is \( CA = -100 \) and the capital account is \( KA = 50 \), what is the equilibrium value of the balance of payments?
A. -50
Correct B. 0
C. 50
D. 100

Correct Answer: B

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Question 4 View Details
A firm's production function is given by \( Q = 2L^0.5K^0.5 \). If the firm's input prices are \( w = 10 \) and \( r = 20 \), what is the profit-maximizing level of labor?
A. 5
Correct B. 10
C. 15
D. 20

Correct Answer: B

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Question 5 View Details
A government's budget constraint is given by \( B = T + I \), where ( T ) is tax revenue and ( I ) is government sp\ending. If the government's tax revenue is \( T = 100 \) and government sp\ending is \( I = 150 \), what is the government's budget deficit?
A. -50
B. 0
C. 50
Correct D. 100

Correct Answer: D

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Question 6 View Details
A firm's production function is given by Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the number of labor units, and K is the number of capital units. If the firm wants to produce 16 units of output, and it has 4 labor units available, how many capital units should it hire?
A. 2
B. 4
Correct C. 6
D. 8

Correct Answer: C

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Question 7 View Details
A consumer's utility function is given by U = 2x + 3y, where x and y are the quantities of two goods consumed. If the consumer's budget constraint is 4x + 2y = 12, and the prices of the two goods are $2 and $3 respectively, what is the consumer's optimal bundle of goods?
A. x = 2, y = 3
Correct B. x = 3, y = 2
C. x = 4, y = 1
D. x = 1, y = 4

Correct Answer: B

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Question 8 View Details
A firm's \cost function is given by C = 2L + 3K, where C is the total \cost, L is the number of labor units, and K is the number of capital units. If the firm hires 2 labor units and 3 capital units, what is the total \cost?
A. 10
B. 12
Correct C. 15
D. 20

Correct Answer: C

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Question 9 View Details
A country's GDP is given by the equation Y = C + I + G, where Y is the GDP, C is the consumption, I is the investment, and G is the government sp\ending. If the country's consumption is $100, investment is $50, and government sp\ending is $20, what is the GDP?
A. 170
B. 180
Correct C. 190
D. 200

Correct Answer: C

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Question 10 View Details
A firm's production function is given by Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the number of labor units, and K is the number of capital units. If the firm wants to produce 16 units of output, and it has 4 labor units available, how many capital units should it hire?
A. 2
B. 4
Correct C. 6
D. 8

Correct Answer: C

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Question 11 View Details
In a perfectly competitive market, the demand curve for a firm's product is its
Correct A. marginal revenue curve
B. marginal \cost curve
C. average revenue curve
D. average \cost curve

Correct Answer: A

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Question 12 View Details
The government of Nigeria has implemented policies to promote industrialization. Which of the following is a major benefit of industrialization?
A. Increased employment opportunities
B. Improved s\tandard of living
C. Increased foreign exchange earnings
Correct D. All of the above

Correct Answer: D

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Question 13 View Details
A firm's total revenue is given by the equation TR = 100x - 2x^2, where x is the number of units sold. What is the marginal revenue when x = 20?
A. 980
Correct B. 1000
C. 1020
D. 1040

Correct Answer: B

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Question 14 View Details
The government of Nigeria has implemented policies to promote agricultural development. Which of the following is a major benefit of agricultural development?
A. Increased food security
B. Improved s\tandard of living
C. Increased foreign exchange earnings
Correct D. All of the above

Correct Answer: D

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Question 15 View Details
A firm's total \cost is given by the equation TC = 500 + 20x + 2x^2, where x is the number of units produced. What is the marginal \cost when x = 10?
A. 40
B. 50
Correct C. 60
D. 70

Correct Answer: C

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Question 16 View Details
A monopolistically competitive firm faces a demand curve with the following equation: \( Q = 100 - 2P \). The firm's marginal \cost (MC) is given by \( MC = 10 + 2Q \). If the firm's fixed \cost is ₦500, what is the profit-maximizing price?
A. ₦50
B. ₦75
Correct C. ₦90
D. ₦120

Correct Answer: C

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Question 17 View Details
The government of Nigeria plans to implement a new tax policy to reduce income inequality. The tax policy involves a progressive tax system where the tax rate increases as income increases. If the tax rate is 10% for income between ₦0 and ₦50,000, 20% for income between ₦50,000 and ₦100,000, and 30% for income above ₦100,000, what is the total tax paid by a person with an income of ₦150,000?
A. ₦30,000
B. ₦35,000
Correct C. ₦40,000
D. ₦45,000

Correct Answer: C

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Question 18 View Details
A firm produces two goods, A and B. The production of good A requires 2 units of labor and 1 unit of capital, while the production of good B requires 1 unit of labor and 2 units of capital. If the firm has 10 units of labor and 8 units of capital, and the prices of goods A and B are ₦100 and ₦120 respectively, what is the optimal production plan?
A. Produce 5 units of good A and 3 units of good B
B. Produce 3 units of good A and 5 units of good B
Correct C. Produce 4 units of good A and 4 units of good B
D. Produce 6 units of good A and 2 units of good B

Correct Answer: C

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Question 19 View Details
A consumer has the following utility function: \( U = 2x + 3y \), where x and y are the quantities of goods X and Y respectively. If the prices of goods X and Y are ₦20 and ₦30 respectively, and the consumer's income is ₦100, what is the optimal consumption bundle?
A. (2, 2)
Correct B. (3, 1)
C. (4, 0)
D. (0, 3)

Correct Answer: B

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Question 20 View Details
A firm faces a demand curve with the following equation: \( Q = 100 - 2P \). The firm's marginal \cost (MC) is given by \( MC = 10 + 2Q \). If the firm's fixed \cost is ₦500, what is the profit-maximizing quantity?
A. 50
Correct B. 75
C. 100
D. 125

Correct Answer: B

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Question 21 View Details
A monopolist faces a demand curve given by Q = 100 - 2P and a \cost function C(Q) = 2Q^2 + 10Q. Find the profit-maximizing quantity and price.
A. 50 units, ₦150
Correct B. 75 units, ₦100
C. 100 units, ₦50
D. 25 units, ₦200

Correct Answer: B

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Question 22 View Details
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm has 100 units of labor and 200 units of capital, find the maximum output.
A. 100 units
B. 200 units
Correct C. 400 units
D. 800 units

Correct Answer: C

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Question 23 View Details
A government imposes a tax of ₦10 per unit on a firm's output. The firm's supply curve is given by Q = 100 - 2P. Find the new supply curve after the tax is imposed.
A. Q = 100 - 4P
Correct B. Q = 100 - 6P
C. Q = 100 - 8P
D. Q = 100 - 10P

Correct Answer: B

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Question 24 View Details
A firm's revenue function is given by R(Q) = 100Q - 2Q^2. Find the marginal revenue function.
Correct A. MR = 100 - 4Q
B. MR = 100 - 2Q
C. MR = 100 + 2Q
D. MR = 100 + 4Q

Correct Answer: A

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Question 25 View Details
A government's budget constraint is given by G = 100 + 0.5T, where G is government exp\enditure and T is tax revenue. If the government wants to sp\end ₦150, find the required tax revenue.
A. ₦50
B. ₦75
C. ₦100
Correct D. ₦125

Correct Answer: D

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