POST UTME MADONNA UNIVERSITY 2023 Economics | Objective

Are you preparing for POST UTME MADONNA UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2023 Economics (Objective) questions designed to simulate the real exam environment.

Practice these randomly selected questions to test your readiness.

Question 1
In a perfectly competitive market, the demand curve for a firm's product is its?
Correct A. marginal revenue curve
B. marginal \cost curve
C. average revenue curve
D. average \cost curve

Correct Answer: A

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Question 2
A country's GDP is calculated as the sum of?
Correct A. consumption, investment, government sp\ending, and net exports
B. consumption, investment, and government sp\ending
C. consumption, investment, and net exports
D. government sp\ending, and net exports

Correct Answer: A

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Question 3
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm wants to increase its output by 20%, what is the required percentage increase in labor and capital?
A. 10% increase in labor and 10% increase in capital
Correct B. 20% increase in labor and 20% increase in capital
C. 15% increase in labor and 15% increase in capital
D. 25% increase in labor and 25% increase in capital

Correct Answer: B

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Question 4
A country's balance of payments accounts can be classified into?
A. current account and capital account
Correct B. current account, capital account, and financial account
C. current account, capital account, and errors and omissions
D. current account, capital account, and reserve account

Correct Answer: B

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Question 5
A firm's marginal revenue product of labor is given by MRP_L = 100L - 2L^2. If the firm hires 5 units of labor, what is the marginal revenue product of the 6th unit of labor?
Correct A. 480
B. 500
C. 520
D. 540

Correct Answer: A

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Question 6
A firm's demand function is given by Q = 100 - 2P + 3Y, where Q is the quantity demanded, P is the price, and Y is the income. If the price elasticity of demand is -2 and the income elasticity of demand is 3, what is the cross-price elasticity of demand?
A. 6
Correct B. -6
C. 0
D. 4

Correct Answer: B

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Question 7
A country's GDP is ₦1,000,000,000,000. If the government decides to increase the price of a commodity by 10%, what will be the effect on the GDP deflator?
Correct A. 10%
B. 5%
C. 0%
D. 15%

Correct Answer: A

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Question 8
A firm is operating in a perfectly competitive market. If the market price is ₦100 and the firm's marginal \cost is ₦80, what will be the firm's profit-maximizing output?
A. 10 units
Correct B. 20 units
C. 30 units
D. 40 units

Correct Answer: B

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Question 9
A country's GNP is ₦1,500,000,000,000. If the country's net factor income from abroad is ₦200,000,000,000, what will be the country's GDP?
Correct A. ₦1,700,000,000,000
B. ₦1,600,000,000,000
C. ₦1,500,000,000,000
D. ₦1,400,000,000,000

Correct Answer: A

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Question 10
A firm is operating in a monopoly market. If the firm's demand function is Q = 100 - 2P and the firm's marginal revenue function is MR = 200 - 2Q, what will be the firm's profit-maximizing output?
A. 20 units
Correct B. 30 units
C. 40 units
D. 50 units

Correct Answer: B

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Question 11
The Nigerian government has implemented a policy to increase agricultural production by providing subsidies to farmers. However, the policy has been criticized for being inefficient and wasteful. Analyze the potential impact of this policy on the agricultural sector and the economy as a whole.
A. The policy will lead to a significant increase in agricultural production and a decrease in food prices.
B. The policy will lead to a decrease in agricultural production and an increase in food prices.
Correct C. The policy will have no significant impact on agricultural production or food prices.
D. The policy will lead to a decrease in agricultural production and a decrease in food prices.

Correct Answer: C

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Question 12
A company is considering investing in a new project that has a projected return on investment (ROI) of 15%. However, the project also has a high level of risk associated with it. Analyze the potential impact of the project on the company's financial performance and recomm\end whether or not the company should invest in the project.
A. The company should invest in the project because the ROI is high enough to justify the risk.
Correct B. The company should not invest in the project because the risk is too high.
C. The company should invest in the project because it has the potential to generate significant revenue.
D. The company should not invest in the project because the ROI is too low.

Correct Answer: B

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Question 13
The Nigerian government has implemented a policy to increase the production of rice by providing subsidies to farmers. However, the policy has been criticized for being inefficient and wasteful. Analyze the potential impact of this policy on the agricultural sector and the economy as a whole.
A. The policy will lead to a significant increase in rice production and a decrease in rice prices.
B. The policy will lead to a decrease in rice production and an increase in rice prices.
Correct C. The policy will have no significant impact on rice production or rice prices.
D. The policy will lead to a decrease in rice production and a decrease in rice prices.

Correct Answer: C

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Question 14
A company is considering investing in a new project that has a projected return on investment (ROI) of 20%. However, the project also has a high level of risk associated with it. Analyze the potential impact of the project on the company's financial performance and recomm\end whether or not the company should invest in the project.
A. The company should invest in the project because the ROI is high enough to justify the risk.
Correct B. The company should not invest in the project because the risk is too high.
C. The company should invest in the project because it has the potential to generate significant revenue.
D. The company should not invest in the project because the ROI is too low.

Correct Answer: B

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Question 15
The Nigerian government has implemented a policy to increase the production of maize by providing subsidies to farmers. However, the policy has been criticized for being inefficient and wasteful. Analyze the potential impact of this policy on the agricultural sector and the economy as a whole.
A. The policy will lead to a significant increase in maize production and a decrease in maize prices.
B. The policy will lead to a decrease in maize production and an increase in maize prices.
Correct C. The policy will have no significant impact on maize production or maize prices.
D. The policy will lead to a decrease in maize production and a decrease in maize prices.

Correct Answer: C

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Question 16
A consumer's utility function is given by U(x, y) = 2x^0.5y^0.5. 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 of x and y?
A. x = 20, y = 10
B. x = 15, y = 12
Correct C. x = 10, y = 15
D. x = 12, y = 15

Correct Answer: C

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Question 17
The demand function for a product is given by Qd = 100 - 2P + 3Y. If the price of the product is ₦20 and the income of the consumer is ₦500, what is the quantity demanded?
A. 50
Correct B. 60
C. 70
D. 80

Correct Answer: B

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Question 18
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's labor and capital are 10 and 20 respectively, what is the firm's output?
A. 20
B. 30
Correct C. 40
D. 50

Correct Answer: C

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Question 19
The government of a country has a budget of ₦100 billion. If the government sp\ends ₦50 billion on education and ₦30 billion on healthcare, what is the remaining budget for other sectors?
Correct A. ₦20 billion
B. ₦30 billion
C. ₦40 billion
D. ₦50 billion

Correct Answer: A

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Question 20
A central bank has a money supply of ₦500 billion. If the bank increases the money supply by 10%, what is the new money supply?
A. ₦550 billion
B. ₦600 billion
Correct C. ₦650 billion
D. ₦700 billion

Correct Answer: C

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Question 21
Determine the value of the elasticity of demand for a firm that experiences a 10% increase in price, resulting in a 5% decrease in quantity demanded, given that the initial price is ₦100 and the initial quantity demanded is 100 units.
Correct A. 0.5
B. 1.0
C. 1.5
D. 2.0

Correct Answer: A

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Question 22
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 increases labor from 100 to 121 units and capital from 100 to 121 units, calculate the percentage change in output.
A. 10%
Correct B. 20%
C. 30%
D. 40%

Correct Answer: B

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Question 23
A country's GDP at market price is ₦1,000,000,000,000, and its GDP at factor \cost is ₦900,000,000,000. Calculate the value of indirect taxes.
Correct A. ₦100,000,000,000
B. ₦200,000,000,000
C. ₦300,000,000,000
D. ₦400,000,000,000

Correct Answer: A

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Question 24
A firm's demand function is given by Q = 100 - 2P, where Q is quantity demanded and P is price. If the firm increases price from ₦50 to ₦60, calculate the percentage change in quantity demanded.
A. -10%
Correct B. -20%
C. -30%
D. -40%

Correct Answer: B

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Question 25
A country's national income is ₦1,500,000,000,000, and its government exp\enditure is ₦400,000,000,000. Calculate the value of private sector savings.
Correct A. ₦1,100,000,000,000
B. ₦1,200,000,000,000
C. ₦1,300,000,000,000
D. ₦1,400,000,000,000

Correct Answer: A

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