Practice Post UTME CHRISTOPHER UNIVERSITY economics 2020 Past Questions

Question 1

In a perfectly competitive market, the supply curve is a straight line. If the price elasticity of demand is 2, and the demand curve is given by Qd = 100 - 2P, what is the price elasticity of supply?

A. 1

Correct B. 2

C. 3

D. 4

Correct Answer: B

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Question 2

A firm's \cost function is given by C(Q) = 2Q^2 + 10Q + 100. If the firm produces 20 units of output, what is the total \cost?

A. ₦500

B. ₦600

Correct C. ₦700

D. ₦800

Correct Answer: C

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Question 3

A consumer's utility function is given by U(x,y) = 2x + 3y. If the consumer's income is ₦1000 and the prices of x and y are ₦5 and ₦10 respectively, what is the consumer's optimal bundle?

A. (10,20)

B. (20,10)

Correct C. (15,15)

D. (25,5)

Correct Answer: C

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Question 4

A firm's revenue function is given by R(Q) = 50Q - 0.5Q^2. If the firm produces 20 units of output, what is the marginal revenue?

A. ₦40

Correct B. ₦50

C. ₦60

D. ₦70

Correct Answer: B

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Question 5

A country's GDP is ₦10 trillion, and its GNP is ₦11 trillion. What is the net factor income from abroad?

A. ₦100 billion

B. ₦200 billion

Correct C. ₦300 billion

D. ₦400 billion

Correct Answer: C

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Question 6

A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's output increases by 20% when labor increases by 10% and capital increases by 15%, what is the value of the elasticity of output with respect to labor?

Correct A. 0.5

B. 1

C. 1.5

D. 2

Correct Answer: A

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Question 7

The government of Nigeria has introduced a new tax policy aimed at increa\sing revenue from the agricultural sector. The policy involves a 10% tax on all agricultural produce sold in the country. If the total value of agricultural produce sold in the country is ₦100 billion, what is the total tax revenue generated from this policy?

Correct A. ₦10,000,000,000

B. ₦20,000,000,000

C. ₦30,000,000,000

D. ₦40,000,000,000

Correct Answer: A

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Question 8

A country's balance of payments account is given by the following equation: BOP = X - M + F - I. If the country's exports (X) are ₦500 billion, imports (M) are ₦300 billion, foreign aid (F) is ₦200 billion, and investment (I) is ₦100 billion, what is the country's balance of payments?

Correct A. ₦200,000,000,000

B. ₦300,000,000,000

C. ₦400,000,000,000

D. ₦500,000,000,000

Correct Answer: A

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Question 9

A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's output increases by 20% when labor increases by 10% and capital increases by 15%, what is the value of the elasticity of output with respect to capital?

A. 0.5

B. 1

Correct C. 1.5

D. 2

Correct Answer: C

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Question 10

The government of Nigeria has introduced a new policy aimed at increa\sing the country's GDP. The policy involves investing ₦100 billion in the agricultural sector. If the agricultural sector's contribution to the country's GDP is 20%, what is the total GDP of the country?

A. ₦500,000,000,000

B. ₦600,000,000,000

Correct C. ₦700,000,000,000

D. ₦800,000,000,000

Correct Answer: C

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Question 11

A firm's demand function is given by Q = 100 - 2P + 5Y. If the price elasticity of demand is measured at a point where Q = 50 and Y = 20, calculate the price elasticity of demand.

A. 1.5

Correct B. -1.5

C. 2.5

D. -2.5

Correct Answer: B

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Question 12

The balance of payments (BOP) accounts for a country can be classified into three main categories: current account, capital account, and financial account. Which of the following is NOT a component of the current account?

A. Exports

B. Imports

Correct C. Foreign Direct Investment

D. Remit\tances

Correct Answer: C

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Question 13

A government imposes a tax on a firm's output. The firm's supply function is given by Q = 100 + 2P. If the tax rate is 10% of the output price, what is the new supply function?

Correct A. Q = 100 + 2.2P

B. Q = 100 + 2.1P

C. Q = 100 + 2P

D. Q = 100 + 2.3P

Correct Answer: A

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Question 14

A country's agricultural sector is characterized by a high degree of seasonality. Which of the following policies would help to mitigate the effects of seasonality on agricultural production?

A. Price support

B. Input subsidies

C. Output marketing boards

Correct D. Crop insurance

Correct Answer: D

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Question 15

A firm's \cost function is given by C = 100 + 2Q + 0.1Q^2. If the firm produces 50 units of output, what is the total \cost?

A. ₦1250

Correct B. ₦1500

C. ₦1750

D. ₦2000

Correct Answer: B

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Question 16

A monopolist faces a market demand curve given by Q = 100 - 2P and a marginal revenue function MR = 200 - 2Q. Find the profit-maximizing price and quantity.

A. P = 50, Q = 25

Correct B. P = 75, Q = 12.5

C. P = 100, Q = 0

D. P = 0, Q = 100

Correct Answer: B

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Question 17

A consumer's utility function is given by U(x, y) = 2x + 3y. The budget constraint is 2x + 3y = 12. Find the consumer's optimal bundle of x and y.

Correct A. x = 2, y = 4

B. x = 4, y = 2

C. x = 6, y = 0

D. x = 0, y = 6

Correct Answer: A

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Question 18

A firm's production function is given by Q = 2L^0.5K^0.5. The firm's \cost function is given by C = 10L + 20K. Find the firm's profit-maximizing level of L and K.

Correct A. L = 4, K = 4

B. L = 16, K = 1

C. L = 1, K = 16

D. L = 0, K = 0

Correct Answer: A

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Question 19

A government is considering a policy to reduce inflation. The government's objective function is given by U(C, P) = 2C + 3P. The constraint is given by C + P = 10. Find the government's optimal policy.

Correct A. C = 5, P = 5

B. C = 10, P = 0

C. C = 0, P = 10

D. C = 5, P = 5

Correct Answer: A

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Question 20

A firm's demand function is given by Q = 100 - 2P. The firm's marginal revenue function is given by MR = 200 - 2Q. Find the firm's profit-maximizing price and quantity.

A. P = 50, Q = 25

Correct B. P = 75, Q = 12.5

C. P = 100, Q = 0

D. P = 0, Q = 100

Correct Answer: B

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Question 21

A government imposes a tax on a commodity to reduce its consumption. If the demand curve for the commodity is downward sloping and the tax is levied on the consumer, what will be the effect on the equilibrium price and quantity of the commodity?

Correct A. The equilibrium price will increase, and the equilibrium quantity will decrease.

B. The equilibrium price will decrease, and the equilibrium quantity will increase.

C. The equilibrium price will remain unchanged, and the equilibrium quantity will decrease.

D. The equilibrium price will increase, and the equilibrium quantity will increase.

Correct Answer: A

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Question 22

A firm is operating in a perfectly competitive market. If the firm's average total \cost curve intersects its marginal \cost curve at a point where the marginal \cost curve is downward sloping, what will be the firm's optimal output level?

Correct A. The firm will produce at the point where the average total \cost curve intersects the marginal \cost curve.

B. The firm will produce at the point where the marginal \cost curve intersects the demand curve.

C. The firm will produce at the point where the average total \cost curve intersects the demand curve.

D. The firm will produce at the point where the marginal \cost curve intersects the average total \cost curve.

Correct Answer: A

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Question 23

A consumer has a utility function given by U(x, y) = 2x + 3y. If the consumer's budget constraint is 10x + 5y = 50, what is the consumer's optimal consumption bundle?

Correct A. x = 2, y = 4

B. x = 4, y = 2

C. x = 5, y = 3

D. x = 3, y = 5

Correct Answer: A

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Question 24

A monopolist faces a demand curve given by Qd = 100 - 2P. If the monopolist's marginal \cost curve is MC = 10, what is the monopolist's optimal price and quantity?

Correct A. P = 40, Q = 30

B. P = 30, Q = 40

C. P = 20, Q = 50

D. P = 50, Q = 20

Correct Answer: A

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Question 25

A consumer has a budget of ₦1000 and faces a price of ₦200 for a commodity. If the consumer's utility function is given by U(x) = 2x, what is the consumer's optimal consumption bundle?

Correct A. x = 2

B. x = 3

C. x = 4

D. x = 5

Correct Answer: A

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