POST UTME REDEEMERS UNIVERSITY 2024 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
The concept of utility in economics refers to the satisfaction or pleasure derived from consuming a product. What is the law of diminishing marginal utility?
A. The more a person consumes, the more utility they derive
B. The more a person consumes, the less utility they derive
C. The more a person consumes, the same utility they derive
D. The more a person consumes, the more utility they derive at a decrea\sing rate
Question 2
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 million and the capital account is $50 million, what is the net capital outflow?
A. -$50 million
B. -$100 million
C. $50 million
D. $100 million
Question 3
A country's balance of payments is in equilibrium when its current account is equal to its capital account. If a country's current account is $50 billion and its capital account is $30 billion, what is the value of net factor income from abroad?
A. $20 billion
B. $30 billion
C. $40 billion
D. $50 billion
Question 4
A country's balance of payments (BOP) is given by the following identity: BOP = X - M, where X is the value of exports and M is the value of imports. If the country's current account balance is in surplus by ₦100 billion and the capital account balance is in deficit by ₦50 billion, what is the overall BOP balance?
A. ₦50 billion surplus
B. ₦50 billion deficit
C. ₦100 billion surplus
D. ₦150 billion deficit
Question 5
A firm's demand function for a particular input is given by Q = 100 - 2P, where Q is the quantity demanded and P is the price of the input. If the firm's current input price is ₦50, what is the firm's optimal input quantity?
A. 20 units
B. 30 units
C. 40 units
D. 50 units
Question 6
The government of a country is considering a policy to increase the production of a particular crop. The crop is currently produced by 100 farmers, each producing 10 units of output. If the government provides a subsidy of ₦5 per unit, how many more units of output will be produced?
A. 100 units
B. 200 units
C. 500 units
D. 1000 units
Question 7
The concept of scarcity in economics implies that the production of one good is limited by the availability of resources, which can be allocated to other goods. This is an example of a trade-off between two goods. What is the opportunity \cost of producing more of one good?
A. The value of the next best alternative good
B. The quantity of the next best alternative good
C. The price of the next best alternative good
D. The demand for the next best alternative good
Question 8
A consumer's utility function is given by the equation U = 2X + 3Y, where U is the utility and X and Y are the quantities of two goods. If the consumer's income is ₦1000 and the prices of the two goods are ₦2 and ₦3 respectively, calculate the optimal quantities of the two goods.
A. X = 200, Y = 300
B. X = 300, Y = 200
C. X = 400, Y = 100
D. X = 100, Y = 400
Question 9
A government imposes a tax on a firm's output. The firm's supply curve shifts to the left. What is the effect on the firm's revenue?
A. The revenue increases.
B. The revenue decreases.
C. The revenue remains unchanged.
D. The revenue increases or decreases dep\ending on the elasticity of demand.
Question 10
In the context of agricultural development in Nigeria, which of the following is a major challenge facing the sector?
A. Climate change
B. Lack of infrastructure
C. Inadequate funding
D. Poor agricultural practices
Question 11
A firm's production function is 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. If the firm wants to produce 100 units of output, and the wage rate is ₦100 per hour and the rental rate of capital is ₦50 per hour, what is the optimal combination of labor and capital?
A. L = 100, K = 100
B. L = 50, K = 200
C. L = 200, K = 50
D. L = 100, K = 50
Question 12
A firm's production function is given by Q = 2L^\( 1/2 \)K^\( 1/2 \). If the price of the good is P = 10 and the wage rate is W = 2, calculate the optimal level of labor (L) and the optimal level of capital (K).
A. L = 4, K = 16
B. L = 16, K = 4
C. L = 2, K = 8
D. L = 8, K = 2
Question 13
A perfectly competitive firm's supply curve is upward-sloping because of the law of increa\sing
A. diminishing marginal returns
B. increa\sing opportunity \costs
C. decrea\sing marginal \costs
D. cons\tant returns to scale
Question 14
A firm is considering two different production processes for producing a product. Process A has a fixed \cost of ₦100,000 and a variable \cost of ₦50 per unit. Process B has a fixed \cost of ₦150,000 and a variable \cost of ₦30 per unit. If the firm produces 10,000 units of output, which process will it choose?
A. Process A
B. Process B
C. Both processes are equally profitable
D. Neither process is profitable
Question 15
A country's GDP is calculated as the sum of all final goods and services produced within its borders. If a country's GDP is $100 billion and its GNP is $120 billion, what is the value of net factor income from abroad?
A. $20 billion
B. $30 billion
C. $40 billion
D. $50 billion

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