POST UTME ELIZADE UNIVERSITY 2018 Commerce | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A country's trade balance is given by the equation TB = X - M, where X is the value of exports and M is the value of imports. If the country's exports are ₦1000 and its imports are ₦800, what is the trade balance?
A. ₦200
B. ₦300
C. ₦400
D. ₦500
Question 2
In a perfectly competitive market, the supply curve is upward-sloping because of the law of increasing marginal opportunity cost. However, this law is not applicable in the case of a firm that is a price-taker. Explain why.
A. Because the firm is a price-taker and cannot influence the market price.
B. Because the firm is a price-maker and can influence the market price.
C. Because the firm is a monopolist and has market power.
D. Because the firm is a monopsonist and has market power.
Question 3
In a perfectly competitive market, the law of supply states that as the price of a good increases, the quantity supplied will
A. increase
B. decrease
C. remain constant
D. shift to the left
Question 4
A firm has the following production function: Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the firm wants to produce 100 units of output, and the wage rate is ₦100 per hour, and the rental rate of capital is ₦200 per hour, what is the optimal combination of labor and capital?
A. L = 10, K = 20
B. L = 20, K = 10
C. L = 30, K = 6
D. L = 6, K = 30
Question 5
A company has a portfolio of assets with the following returns: Asset A has a 20% chance of returning 10%, a 30% chance of returning 20%, and a 50% chance of returning 30%. Asset B has a 20% chance of returning 10%, a 30% chance of returning 20%, and a 50% chance of returning 30%. What is the expected return of the portfolio?
A. 15%
B. 20%
C. 25%
D. 30%
Question 6
A company has a portfolio of assets with the following returns: Asset A has a 20% chance of returning 10%, a 30% chance of returning 20%, and a 50% chance of returning 30%. Asset B has a 20% chance of returning 10%, a 30% chance of returning 20%, and a 50% chance of returning 30%. What is the expected return of the portfolio?
A. 15%
B. 20%
C. 25%
D. 30%
Question 7
In a perfectly competitive market, the supply curve is horizontal and the demand curve is downward-sloping. What is the equilibrium price and quantity of a product in this market?
A. ₦100, 100 units
B. ₦120, 80 units
C. ₦150, 60 units
D. ₦180, 40 units
Question 8
A firm has the following production function: Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the firm wants to produce 100 units of output, and the wage rate is ₦100 per hour, and the rental rate of capital is ₦200 per hour, what is the optimal level of labor?
A. 10 hours
B. 20 hours
C. 30 hours
D. 40 hours
Question 9
A consumer has a utility function of U = 2x + 3y, where x and y are the quantities of two goods consumed. If the prices of the two goods are ₦50 and ₦100 respectively, and the consumer's income is ₦1000, what is the optimal bundle of goods that maximizes the consumer's utility?
A. x = 10, y = 5
B. x = 5, y = 10
C. x = 15, y = 3
D. x = 20, y = 2
Question 10
A firm's revenue function is given by R = 100Q - 2Q^2. If the firm's current price is 10 per unit, what is the firm's current revenue?
A. 100
B. 200
C. 300
D. 400
Question 11
A consumer has a budget constraint of 100x + 50y = 1000, where x and y are the quantities of two goods consumed. If the consumer's utility function is U = 2x + 3y, what is the optimal bundle of goods that maximizes the consumer's utility?
A. x = 10, y = 5
B. x = 5, y = 10
C. x = 15, y = 3
D. x = 20, y = 2
Question 12
A consumer protection agency has received a complaint about a company's misleading advertising. The agency's primary goal in investigating the complaint is to determine whether the company has engaged in:
A. Unfair competition
B. Deceptive trade practices
C. False advertising
D. Unfair contract terms
Question 13
A company has purchased a liability insurance policy with a deductible of ₦50,000. If the company incurs a loss of ₦150,000, what is the company's net loss after deducting the deductible?
A. ₦100,000
B. ₦50,000
C. ₦0
D. ₦150,000
Question 14
In a perfectly competitive market, the supply curve is upward-sloping because of the law of increasing marginal opportunity costs. However, in a monopoly, the supply curve is downward-sloping due to the law of diminishing marginal returns. Which of the following best describes the relationship between the two laws?
A. The law of increasing marginal opportunity costs is a result of the law of diminishing marginal returns.
B. The law of diminishing marginal returns is a result of the law of increasing marginal opportunity costs.
C. The law of increasing marginal opportunity costs is a separate concept from the law of diminishing marginal returns.
D. The law of diminishing marginal returns is a result of the law of increasing marginal opportunity costs in the short run, but not in the long run.
Question 15
A firm has the following probability distribution of possible outcomes: P(X=1) = 0.2, P(X=2) = 0.3, P(X=3) = 0.5. What is the expected value of X?
A. 1.1
B. 1.3
C. 1.5
D. 1.7

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