POST UTME FUTO 2020 Economics | Objective

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Question 1 View Details
The concept of scarcity in economics implies that the production of one good is limited by the availability of resources that could be used to produce other goods. Which of the following is a correct statement about the opportunity \cost of producing one good?
Correct A. The opportunity \cost is the value of the next best alternative good that could have been produced with the same resources.
B. The opportunity \cost is the value of the next best alternative good that could have been consumed with the same resources.
C. The opportunity \cost is the value of the next best alternative good that could have been produced with the same resources, but not consumed.
D. The opportunity \cost is the value of the next best alternative good that could have been consumed with the same resources, but not produced.

Correct Answer: A

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Question 2 View Details
A firm's demand curve 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 calculated to be 0.5, what is the percentage change in quantity demanded for a 10% increase in price?
Correct A. 5%
B. 10%
C. 15%
D. 20%

Correct Answer: A

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Question 3 View Details
The following diagram shows the supply and demand curves for a product. What is the equilibrium price and quantity?
Correct A. Price = ₦100, Quantity = 50
B. Price = ₦150, Quantity = 30
C. Price = ₦200, Quantity = 20
D. Price = ₦250, Quantity = 10

Correct Answer: A

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Question 4 View Details
A consumer's utility function is given by U(x,y) = 2x + 3y, where x and y are the quantities of two goods consumed. If the consumer's budget constraint is given by 2x + 3y = ₦100, what is the optimal combination of x and y?
A. x = 10, y = 10
Correct B. x = 15, y = 5
C. x = 20, y = 0
D. x = 0, y = 20

Correct Answer: B

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Question 5 View Details
The following diagram shows the money market equilibrium. What is the equilibrium interest rate?
A. 10%
Correct B. 15%
C. 20%
D. 25%

Correct Answer: B

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Question 6 View Details
Consider a firm operating in a perfectly competitive market with a demand curve given by Q = 100 - 2P and a supply curve given by Q = 2P - 10. Find the equilibrium price and quantity.
A. ₦50, 90
Correct B. ₦40, 80
C. ₦30, 70
D. ₦20, 60

Correct Answer: B

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Question 7 View Details
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 ₦100 billion, imports (M) are ₦80 billion, foreign investment (F) is ₦20 billion, and domestic investment (I) is ₦30 billion, what is the balance of payments?
Correct A. ₦10 billion surplus
B. ₦20 billion deficit
C. ₦30 billion surplus
D. ₦40 billion deficit

Correct Answer: A

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Question 8 View Details
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. ₦1,300
B. ₦1,400
Correct C. ₦1,500
D. ₦1,600

Correct Answer: C

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Question 9 View Details
A country's GDP is given by the equation: GDP = C + I + G + \( X - M \). If the country's consumption (C) is ₦500 billion, investment (I) is ₦200 billion, government sp\ending (G) is ₦300 billion, exports (X) are ₦400 billion, and imports (M) are ₦300 billion, what is the GDP?
A. ₦1,500 billion
B. ₦1,600 billion
Correct C. ₦1,700 billion
D. ₦1,800 billion

Correct Answer: C

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Question 10 View Details
A monopoly firm's demand curve is given by Q = 100 - 2P. If the firm's marginal revenue (MR) is ₦20, what is the price elasticity of demand?
A. -1
Correct B. -2
C. -3
D. -4

Correct Answer: B

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Question 11 View Details
A firm's total revenue (TR) is given by the equation TR = 100q - 2q^2, where q is the quantity sold. If the firm sells 20 units, what is its total revenue?
A. 1000
B. 1200
Correct C. 1800
D. 2000

Correct Answer: C

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Question 12 View Details
A monopolist faces a demand curve given by P = 100 - 2q. If the firm's marginal \cost is 10, what is the optimal quantity to produce?
A. 20
Correct B. 30
C. 40
D. 50

Correct Answer: B

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Question 13 View Details
A firm's \cost function is given by C(q) = 100 + 2q. If the firm sells 20 units, what is its total \cost?
A. 200
B. 220
Correct C. 240
D. 260

Correct Answer: C

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Question 14 View Details
A firm's revenue function is given by R(q) = 100q - 2q^2. If the firm sells 20 units, what is its marginal revenue?
A. 80
B. 90
Correct C. 100
D. 110

Correct Answer: C

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Question 15 View Details
A firm's demand function is given by q = 50 - 2P. If the firm's revenue is 1000, what is the price?
A. 20
Correct B. 30
C. 40
D. 50

Correct Answer: B

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Question 16 View Details
A firm's average total \cost curve intersects its marginal \cost curve at point E, where MC = ATC. If the firm is currently producing at point E, and the price of the good is P = 10, what is the firm's economic profit?
Correct A. ₦100
B. ₦200
C. ₦300
D. ₦400

Correct Answer: A

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Question 17 View Details
A country's balance of payments account is in equilibrium when the current account is equal to the capital account. If the current account is -₦100 billion and the capital account is ₦150 billion, what is the net capital outflow?
A. ₦250 billion
B. ₦200 billion
Correct C. ₦150 billion
D. ₦100 billion

Correct Answer: C

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Question 18 View Details
A perfectly competitive firm's supply curve is given by Q = 10 - 2P. If the price of the good is P = 5, what is the firm's marginal \cost?
A. ₦5
Correct B. ₦10
C. ₦15
D. ₦20

Correct Answer: B

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Question 19 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, what is the firm's output?
A. 100
B. 200
Correct C. 300
D. 400

Correct Answer: C

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Question 20 View Details
A country's GDP is given by GDP = C + I + G + \( X - M \). If the country's consumption is ₦500 billion, investment is ₦200 billion, government sp\ending is ₦300 billion, exports are ₦400 billion, and imports are ₦200 billion, what is the country's GDP?
A. ₦1.5 trillion
B. ₦1.6 trillion
Correct C. ₦1.7 trillion
D. ₦1.8 trillion

Correct Answer: C

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Question 21 View Details
The elasticity of demand for a product is -2. If the price of the product increases by 10%, what is the percentage change in the quantity demanded?
Correct A. -20%
B. -10%
C. 0%
D. 10%

Correct Answer: A

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Question 22 View Details
A firm's production function is given by Q = 2L^0.5K^0.5. If the price of labor increases by 20% and the price of capital increases by 15%, what is the new production level?
A. 80
B. 90
C. 100
Correct D. 110

Correct Answer: D

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Question 23 View Details
The government of Nigeria has implemented a policy to increase the production of rice by 20% in the next year. If the current production level is 10 million metric tons, what is the new production level?
Correct A. 12 million metric tons
B. 11 million metric tons
C. 10 million metric tons
D. 9 million metric tons

Correct Answer: A

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Question 24 View Details
A consumer has a utility function given by U = 2x + 3y. If the prices of x and y are $5 and $10 respectively, and the consumer has a budget of $50, what is the optimal consumption bundle?
A. x = 5, y = 2
Correct B. x = 10, y = 5
C. x = 15, y = 10
D. x = 20, y = 15

Correct Answer: B

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Question 25 View Details
The government of Nigeria has implemented a policy to increase the tax rate by 10%. If the current tax revenue is ₦100 billion, what is the new tax revenue?
Correct A. ₦110 billion
B. ₦105 billion
C. ₦100 billion
D. ₦95 billion

Correct Answer: A

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