Practice Post UTME LAUTECH economics 2018 Past Questions

Question 1

A country's government decides to implement a new tax on imports to reduce its budget deficit. If the tax rate is 15% and the import value is ₦100 billion, what is the amount of tax collected?

Correct A. ₦15 billion

B. ₦1.5 billion

C. ₦15 million

D. ₦1.5 million

Correct Answer: A

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Question 2

A firm operates in a perfectly competitive market. If the market price is $10 and the firm's marginal \cost is $8, what is the firm's profit-maximizing quantity?

A. 100 units

Correct B. 200 units

C. 500 units

D. 1000 units

Correct Answer: B

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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 ₦100 and the prices of x and y are ₦5 and ₦10 respectively, what is the consumer's optimal bundle?

Correct A. (20, 10)

B. (10, 20)

C. (5, 5)

D. (15, 15)

Correct Answer: A

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Question 4

A country's balance of payments account is given by the following equation: BOP = X - M + F - I. If the country's exports are ₦100 billion, imports are ₦80 billion, foreign aid is ₦20 billion, and investment is ₦10 billion, what is the country's balance of payments?

Correct A. ₦30 billion

B. ₦20 billion

C. ₦10 billion

D. ₦5 billion

Correct Answer: A

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Question 5

A firm operates in a monopoly market. If the firm's demand function is given by Q = 100 - 2P and the firm's marginal \cost is $10, what is the firm's profit-maximizing price?

A. $20

Correct B. $30

C. $40

D. $50

Correct Answer: B

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Question 6

The demand for a commodity 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 0.5, find the percentage change in quantity demanded when the price increases by 10%.

Correct A. 5%

B. 10%

C. 15%

D. 20%

Correct Answer: A

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Question 7

A firm produces two goods, X and Y, u\sing two inputs, labor (L) and capital (K). The production functions are given by X = 2L + 3K and Y = 4L + 2K. If the firm has 10 units of labor and 8 units of capital, find the maximum value of the objective function Z = 3X + 2Y.

A. 24

B. 30

Correct C. 36

D. 42

Correct Answer: C

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Question 8

The government of a country imposes a tax on a commodity, which increases the price of the commodity by 20%. If the demand for the commodity is given by Qd = 100 - 2P and the supply is given by Qs = 2P + 10, find the new equilibrium price and quantity.

Correct A. ₦20, 40 units

B. ₦30, 60 units

C. ₦40, 80 units

D. ₦50, 100 units

Correct Answer: A

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Question 9

A firm produces a commodity u\sing two inputs, labor (L) and capital (K). The production function is given by Q = 2L + 3K. If the firm has 10 units of labor and 8 units of capital, find the marginal product of labor and the marginal product of capital.

Correct A. 2, 3

B. 3, 2

C. 4, 5

D. 5, 4

Correct Answer: A

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Question 10

The government of a country imposes a tax on a commodity, which increases the price of the commodity by 20%. If the demand for the commodity is given by Qd = 100 - 2P and the supply is given by Qs = 2P + 10, find the deadweight loss of the tax.

A. ₦100

B. ₦200

Correct C. ₦300

D. ₦400

Correct Answer: C

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Question 11

The indifference curve for a consumer is downward sloping because of the law of increa\sing marginal utility. What is the implication of this law on the consumer's behavior?

A. The consumer will always choose the combination of goods that gives the highest marginal utility.

B. The consumer will always choose the combination of goods that gives the highest total utility.

Correct C. The consumer will always choose the combination of goods that gives the highest marginal utility per unit of money spent.

D. The consumer will always choose the combination of goods that gives the highest marginal utility per unit of time spent.

Correct Answer: C

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Question 12

A country's money supply is increased by the central bank. What is the likely effect on the price level?

A. The price level will decrease.

Correct B. The price level will increase.

C. The price level will remain unchanged.

D. The price level will fluctuate randomly.

Correct Answer: B

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Question 13

A country's trade deficit is financed by borrowing from abroad. What is the likely effect on the country's exchange rate?

A. The exchange rate will appreciate.

Correct B. The exchange rate will depreciate.

C. The exchange rate will remain unchanged.

D. The exchange rate will fluctuate randomly.

Correct Answer: B

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Question 14

A government imposes a tax on a particular good. What is the likely effect on the supply of that good?

A. The supply of the good will increase.

Correct B. The supply of the good will decrease.

C. The supply of the good will remain unchanged.

D. The supply of the good will fluctuate randomly.

Correct Answer: B

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Question 15

A country's economic growth is measured by its GDP. What is the likely effect of an increase in GDP on the country's s\tandard of living?

Correct A. The s\tandard of living will increase.

B. The s\tandard of living will decrease.

C. The s\tandard of living will remain unchanged.

D. The s\tandard of living will fluctuate randomly.

Correct Answer: A

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Question 16

A country's trade balance is in deficit. What is the likely effect on the country's exchange rate?

A. The exchange rate will appreciate.

Correct B. The exchange rate will depreciate.

C. The exchange rate will remain unchanged.

D. The exchange rate will fluctuate randomly.

Correct Answer: B

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Question 17

A government imposes a tax on a particular good. What is the likely effect on the demand for that good?

A. The demand for the good will increase.

Correct B. The demand for the good will decrease.

C. The demand for the good will remain unchanged.

D. The demand for the good will fluctuate randomly.

Correct Answer: B

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Question 18

A country's economic growth is measured by its GDP per capita. What is the likely effect of an increase in GDP per capita on the country's s\tandard of living?

Correct A. The s\tandard of living will increase.

B. The s\tandard of living will decrease.

C. The s\tandard of living will remain unchanged.

D. The s\tandard of living will fluctuate randomly.

Correct Answer: A

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Question 19

A country's trade balance is in surplus. What is the likely effect on the country's exchange rate?

Correct A. The exchange rate will appreciate.

B. The exchange rate will depreciate.

C. The exchange rate will remain unchanged.

D. The exchange rate will fluctuate randomly.

Correct Answer: A

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Question 20

A government imposes a tax on a particular good. What is the likely effect on the supply of that good?

A. The supply of the good will increase.

B. The supply of the good will decrease.

C. The supply of the good will remain unchanged.

D. The supply of the good will fluctuate randomly.

Correct Answer: VIEW ANSWER

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Question 21

A firm has a total revenue function of $ TR = 100x - 2x^2 $ and a total \cost function of $ TC = 50x + 10x^2 $. Find the profit-maximizing output level.

A. 20 units

B. 30 units

Correct C. 25 units

D. 40 units

Correct Answer: C

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Question 22

A country's import demand function is given by $ MD = 100 - 2P $, where P is the price of the imported good. If the price of the imported good is $50, what is the quantity demanded?

A. 25 units

Correct B. 30 units

C. 20 units

D. 40 units

Correct Answer: B

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Question 23

A firm has a production function of $ Q = 10L^0.5K^0.5 $. If the firm uses 100 units of labor and 400 units of capital, what is the output level?

A. 100 units

B. 200 units

Correct C. 300 units

D. 400 units

Correct Answer: C

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Question 24

A country's export supply function is given by $ ES = 50 + 2P $, where P is the price of the exported good. If the price of the exported good is $60, what is the quantity supplied?

A. 20 units

B. 30 units

C. 40 units

Correct D. 50 units

Correct Answer: D

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Question 25

A firm has a total revenue function of $ TR = 200x - 5x^2 $ and a total \cost function of $ TC = 100x + 10x^2 $. Find the profit-maximizing output level.

A. 20 units

B. 30 units

Correct C. 25 units

D. 40 units

Correct Answer: C

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