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POST UTME ELIZADE UNIVERSITY 2022 Economics | Objective

Are you preparing for POST UTME ELIZADE UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2022 Economics (Objective) questions designed to simulate the real exam environment.

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Question 1

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 labor and capital are increased by 20% and 15% respectively, what is the percentage change in output?

A. 10%

B. 12%

Correct C. 15%

D. 18%

Correct Answer: C

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Question 2

A country's import demand function is given by M = 100 - 2P, where M is imports and P is the price of the imported good. If the price of the imported good increases by 20%, what is the percentage change in imports?

Correct A. -20%

B. -15%

C. -10%

D. -5%

Correct Answer: A

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Question 3

A firm's \cost function is given by C = 100 + 2L + 3K, where C is \cost, L is labor, and K is capital. If the firm's labor and capital are increased by 20% and 15% respectively, what is the percentage change in \cost?

A. 10%

B. 12%

Correct C. 15%

D. 18%

Correct Answer: C

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Question 4

A country's export supply function is given by X = 100 + 2P, where X is exports and P is the price of the exported good. If the price of the exported good increases by 20%, what is the percentage change in exports?

A. 20%

Correct B. 25%

C. 30%

D. 35%

Correct Answer: B

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Question 5

A firm's revenue function is given by R = 100L + 200K, where R is revenue, L is labor, and K is capital. If the firm's labor and capital are increased by 20% and 15% respectively, what is the percentage change in revenue?

A. 10%

B. 12%

Correct C. 15%

D. 18%

Correct Answer: C

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Question 6

A firm produces two goods, X and Y, u\sing two inputs, labor (L) and capital (K). The production function for good X is given by X = 2L^0.5K^0.5, while the production function for good Y is given by Y = 3L^0.25K^0.75. If the firm has 100 units of labor and 200 units of capital, and it wants to maximize the total output \( X + Y \), what is the optimal allocation of labor and capital between the two goods?

A. Allocate 50 units of labor and 100 units of capital to good X, and 50 units of labor and 100 units of capital to good Y.

Correct B. Allocate 75 units of labor and 150 units of capital to good X, and 25 units of labor and 50 units of capital to good Y.

C. Allocate 100 units of labor and 200 units of capital to good X, and 0 units of labor and 0 units of capital to good Y.

D. Allocate 0 units of labor and 0 units of capital to good X, and 100 units of labor and 200 units of capital to good Y.

Correct Answer: B

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Question 7

A monopolist firm produces a product with a demand function given by Q = 100 - 2P, where Q is the quantity demanded and P is the price. The firm's marginal \cost (MC) is given by MC = 10 + 2Q. What is the profit-maximizing price and quantity for the firm?

Correct A. Price = ₦50, Quantity = 40 units

B. Price = ₦75, Quantity = 25 units

C. Price = ₦100, Quantity = 20 units

D. Price = ₦125, Quantity = 15 units

Correct Answer: A

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Question 8

A government is considering implementing a tax on a particular good. The supply function for the good is given by Q = 100 + 2P, where Q is the quantity supplied and P is the price. The demand function for the good is given by Q = 100 - 2P. If the government imposes a tax of ₦10 per unit on the good, what will be the new equilibrium price and quantity?

Correct A. Price = ₦60, Quantity = 80 units

B. Price = ₦70, Quantity = 90 units

C. Price = ₦80, Quantity = 100 units

D. Price = ₦90, Quantity = 110 units

Correct Answer: A

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Question 9

A firm is considering investing in a new project. The project requires an initial investment of ₦100,000 and is expected to generate a revenue of ₦120,000 per year for 5 years. The firm's \cost of capital is 10% per year. What is the net present value (NPV) of the project?

A. ₦50,000

Correct B. ₦60,000

C. ₦70,000

D. ₦80,000

Correct Answer: B

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Question 10

A firm is producing a product u\sing a production function given by Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. The firm has 100 units of labor and 200 units of capital. What is the marginal product of labor (MPL) and the marginal product of capital (MPK) when the firm is producing 50 units of the product?

A. MPL = 0.5, MPK = 0.5

Correct B. MPL = 0.75, MPK = 0.25

C. MPL = 1, MPK = 1

D. MPL = 1.5, MPK = 0.5

Correct Answer: B

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Question 11

A firm operating under perfect competition faces a market demand curve that is downward-sloping. What is the shape of the firm's marginal revenue (MR) curve?

A. Horizontal

B. Vertical

Correct C. Downward-sloping

D. Upward-sloping

Correct Answer: C

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Question 12

A consumer's indifference curve is represented by the equation ( 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. x = 20, y = 10

Correct B. x = 15, y = 15

C. x = 10, y = 20

D. x = 5, y = 25

Correct Answer: B

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Question 13

A country's GDP is ₦100 billion, its imports are ₦20 billion, and its exports are ₦15 billion. What is its net foreign income?

Correct A. ₦5 billion

B. ₦10 billion

C. ₦15 billion

D. ₦20 billion

Correct Answer: A

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Question 14

A firm's production function is given by \( Q = 2L^{0.5}K^{0.5} \). If the firm's output is 100 units and the price of labor is ₦10 per unit, what is the minimum \cost of production?

A. ₦1000

Correct B. ₦2000

C. ₦5000

D. ₦10000

Correct Answer: B

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Question 15

A country's GNP is ₦120 billion, its net factor income from abroad is ₦10 billion, and its GDP is ₦110 billion. What is its net foreign income?

A. ₦5 billion

Correct B. ₦10 billion

C. ₦15 billion

D. ₦20 billion

Correct Answer: B

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Question 16

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 -2, what is the percentage change in quantity demanded when the price increases by 10%?

Correct A. 20%

B. 30%

C. 40%

D. 50%

Correct Answer: A

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Question 17

A firm's total revenue (TR) is given by the equation TR = 1000 + 20Q - 0.5Q^2, where Q is the quantity sold. If the firm sells 100 units, what is the marginal revenue?

A. ₦200

B. ₦250

Correct C. ₦300

D. ₦350

Correct Answer: C

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Question 18

A consumer's utility function is given by the equation U = 2x + 3y, where x and y are the quantities of two goods consumed. If the consumer's budget constraint is 10x + 5y = 50, what is the optimal combination of x and y?

Correct A. x = 2, y = 4

B. x = 3, y = 5

C. x = 4, y = 6

D. x = 5, y = 7

Correct Answer: A

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Question 19

A firm's \cost function is given by the equation C = 100 + 20Q + 0.5Q^2, where Q is the quantity produced. If the firm produces 50 units, what is the total \cost?

A. ₦1500

B. ₦2000

Correct C. ₦2500

D. ₦3000

Correct Answer: C

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Question 20

A country's balance of payments account is given by the equation BOP = X - M, where X is the value of exports and M is the value of imports. If the country's exports are ₦1000 and imports are ₦800, what is the balance of payments?

Correct A. ₦200

B. ₦300

C. ₦400

D. ₦500

Correct Answer: A

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Question 21

Consider a perfectly competitive market with n firms, each producing a homogeneous product. If the market demand curve is downward sloping and the firms are price takers, what is the relationship between the marginal revenue (MR) and the price (P) of the product?

A. MR = P

B. MR > P

Correct C. MR < P

D. MR = 0

Correct Answer: C

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Question 22

A firm is producing a product with a total revenue (TR) of ₦1,000,000 and a total \cost (TC) of ₦800,000. If the firm's profit-maximizing output is 100 units, what is the opportunity \cost of producing one more unit of the product?

A. ₦10,000

Correct B. ₦20,000

C. ₦30,000

D. ₦40,000

Correct Answer: B

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Question 23

A monopolist is facing a demand curve with the following equation: P = 100 - 2Q. If the firm's marginal \cost (MC) is ₦20, what is the profit-maximizing quantity of the product?

A. 20 units

B. 30 units

Correct C. 40 units

D. 50 units

Correct Answer: C

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Question 24

A firm is experiencing increa\sing returns to scale in its production process. If the firm's output increases from 100 units to 200 units, what is the percentage change in its total output?

A. 25%

Correct B. 50%

C. 75%

D. 100%

Correct Answer: B

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Question 25

A consumer is faced with the following budget constraint: 2x + 3y = 12. If the price of good x is ₦2 and the price of good y is ₦3, what is the consumer's optimal bundle of goods?

A. (2, 2)

Correct B. (4, 1)

C. (6, 0)

D. (0, 4)

Correct Answer: B

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