POST UTME LAUTECH 2023 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A firm's production function is given by Q = 2L^0.5K^0.5. If the price of labor is ₦100 per unit and the price of capital is ₦200 per unit, and the firm is currently producing 100 units of output, what is the minimum \cost of producing 120 units of output?
A. ₦24,000
B. ₦26,000
C. ₦28,000
D. ₦30,000
Question 2
A firm's production function is given by Q = 2L^0.5K^0.5, where Q is output, L is labor, and K is capital. If the firm's labor and capital inputs are increased by 10% and 20% respectively, what is the percentage change in output?
A. 10%
B. 20%
C. 30%
D. 40%
Question 3
A country's balance of payments is given by the equation BOP = X - M. If the country's exports are ₦500,000,000 and its imports are ₦300,000,000, what is the balance of payments?
A. ₦100,000,000
B. ₦200,000,000
C. ₦300,000,000
D. ₦400,000,000
Question 4
A country's population growth rate is given by the equation P(t) = 1000e^(0.02t), where P(t) is the population at time t. If the initial population is 1000, what is the population after 10 years?
A. 1219
B. 1400
C. 1600
D. 1800
Question 5
A firm's revenue function is given by R = 100Q - 2Q^2, where R is revenue and Q is quantity sold. If the firm sells 20 units, what is its revenue?
A. ₦1800
B. ₦2000
C. ₦2200
D. ₦2400
Question 6
A country is experiencing a trade deficit due to a large imbalance in its trade with another country. U\sing the concept of comparative advantage, explain why the country should focus on increa\sing its exports rather than trying to reduce its imports.
A. The country should focus on increa\sing its exports because it has a comparative advantage in producing goods that are in high demand.
B. The country should focus on reducing its imports because it has a comparative disadvantage in producing goods that are in high demand.
C. The country should focus on increa\sing its exports because it has a comparative disadvantage in producing goods that are in high demand.
D. The country should focus on reducing its imports because it has a comparative advantage in producing goods that are in high demand.
Question 7
A country's GDP grows at an annual rate of 5% while its population grows at an annual rate of 2%. If the current GDP is ₦10 trillion, what is the GDP 5 years from now?
A. ₦13.43 trillion
B. ₦12.87 trillion
C. ₦14.21 trillion
D. ₦15.65 trillion
Question 8
A firm is considering two investment projects, A and B. Project A has a higher initial \cost but generates a higher return on investment. Project B has a lower initial \cost but generates a lower return on investment. U\sing the concept of opportunity \cost, explain why the firm should choose project A over project B.
A. Project A has a higher return on investment, making it a better choice.
B. Project B has a lower initial \cost, making it a better choice.
C. Project A has a higher opportunity \cost, making it a worse choice.
D. Project B has a higher opportunity \cost, making it a worse choice.
Question 9
A monopolistically competitive firm faces a demand curve given by P = 100 - 2Q. If the firm's marginal revenue (MR) is given by MR = 100 - 4Q, what is the firm's optimal quantity of output?
A. 10 units
B. 20 units
C. 30 units
D. 40 units
Question 10
A country's GDP is given by the equation GDP = C + I + G + \( X - M \), where C is consumption, I is investment, G is government sp\ending, X is exports, and M is imports. If the country's GDP is $100 billion, consumption is $60 billion, investment is $20 billion, government sp\ending is $10 billion, exports are $30 billion, and imports are $20 billion, what is the country's balance of trade?
A. $10 billion surplus
B. $10 billion deficit
C. $20 billion surplus
D. $20 billion deficit
Question 11
A country is experiencing a trade deficit due to a large imbalance in its trade with another country. U\sing the concept of comparative advantage, explain why the country should focus on increa\sing its exports rather than trying to reduce its imports.
A. The country should focus on increa\sing its exports because it has a comparative advantage in producing goods that are in high demand.
B. The country should focus on reducing its imports because it has a comparative disadvantage in producing goods that are in high demand.
C. The country should focus on increa\sing its exports because it has a comparative disadvantage in producing goods that are in high demand.
D. The country should focus on reducing its imports because it has a comparative advantage in producing goods that are in high demand.
Question 12
A country's GDP is given by the equation Y = C + I + G, where Y is the GDP, C is the consumption, I is the investment, and G is the government sp\ending. If the consumption is 100, investment is 50, and government sp\ending is 200, what is the GDP?
A. 350
B. 400
C. 450
D. 500
Question 13
A country's balance of payments 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 ₦30 billion, what is the balance of payments?
A. ₦10 billion
B. ₦20 billion
C. ₦30 billion
D. ₦40 billion
Question 14
A country's balance of payments (BOP) is in equilibrium when the current account and capital account are balanced. However, the BOP can also be in equilibrium when the current account is not balanced, but the capital account is not balanced either. Which of the following is a correct statement regarding the BOP equilibrium?
A. The BOP is in equilibrium when the current account and capital account are balanced.
B. The BOP can be in equilibrium when the current account is not balanced, but the capital account is not balanced either.
C. The BOP is in equilibrium when the current account is balanced, but the capital account is not balanced.
D. The BOP is in equilibrium when the capital account is balanced, but the current account is not balanced.
Question 15
The Marshall-Lerner condition states that a country's balance of payments will improve if the sum of the percentage changes in its export and import prices exceeds a certain threshold. What is the name of this threshold?
A. The Marshall-Lerner condition
B. The J-curve effect
C. The balance of payments equilibrium
D. The trade deficit threshold

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