POST UTME RHEMA UNIVERSITY 2023 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A farmer in Nigeria produces 1000 bags of maize per year. The price of maize is ₦1500 per bag. If the government imposes a 20% tax on the sale of maize, what is the new price of maize per bag?
A. ₦1800
B. ₦1800
C. ₦1800
D. ₦1800
Question 2
Consider a firm operating in a perfectly competitive market with a given production function Q = 2L^0.5K^0.5. If the firm's current input prices are w = ₦100 and r = ₦200, and the current output price is p = ₦500, calculate the firm's optimal input mix (L, K) u\sing the Hotelling's Lemma. Assume that the firm's objective is to maximize profits.
A. L = 100, K = 50
B. L = 50, K = 100
C. L = 200, K = 100
D. L = 100, K = 200
Question 3
A firm's demand curve is given by Qd = 100 - 2P. U\sing the concept of elasticity, explain why the firm's demand is inelastic at a price of 20.
A. The firm's demand is inelastic at a price of 20 because the elasticity of demand is less than 1.
B. The firm's demand is elastic at a price of 20 because the elasticity of demand is greater than 1.
C. The firm's demand is inelastic at a price of 20 because the elasticity of demand is equal to 1.
D. The firm's demand is elastic at a price of 20 because the elasticity of demand is less than 1.
Question 4
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's input prices are w = ₦100 per unit of labor and r = ₦200 per unit of capital, what is the firm's optimal input bundle?
A. 10 units of labor and 20 units of capital
B. 20 units of labor and 10 units of capital
C. 30 units of labor and 15 units of capital
D. 40 units of labor and 25 units of capital
Question 5
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 income is ₦1,000 and the prices of the two goods are ₦5 and ₦10 respectively, what is the consumer's optimal bundle of goods?
A. x = 100, y = 50
B. x = 50, y = 100
C. x = 200, y = 0
D. x = 0, y = 200
Question 6
A country's GNP at market price is ₦12 trillion. The government imposes a 15% Value Added Tax (VAT) on all goods and services. Calculate the country's GNP at factor \cost.
A. ₦10.5 trillion
B. ₦11 trillion
C. ₦11.5 trillion
D. ₦12 trillion
Question 7
A government is considering a tax on a particular good. The tax revenue is ₦1000 and the deadweight loss is ₦500. What is the government's net gain from the tax?
A. ₦500
B. ₦1000
C. ₦1500
D. ₦2000
Question 8
A monopolistically competitive firm faces a downward-sloping demand curve. U\sing the concept of marginal revenue, explain why the firm will produce at the level where MR = MC.
A. The firm will produce at the level where MR = MC because it maximizes profit.
B. The firm will produce at the level where MR = MC because it minimizes \cost.
C. The firm will produce at the level where MR = MC because it faces a downward-sloping demand curve.
D. The firm will produce at the level where MR = MC because it is a monopolistically competitive firm.
Question 9
A firm's production function is given by Q = 2L^2 + 5K, where Q is output, L is labor, and K is capital. Determine the returns to scale.
A. Increa\sing returns to scale
B. Decrea\sing returns to scale
C. Cons\tant returns to scale
D. No returns to scale
Question 10
A firm's supply function is given by Q = 50 + 2P. If the firm's current price is 20, what is the firm's current quantity supplied?
A. 60
B. 70
C. 80
D. 90
Question 11
A firm's production function is given by Q = 2L^0.5 * K^0.5. If the firm's current input levels are L = 4 and K = 9, what is the marginal product of labor (MPL) at these input levels?
A. 1
B. 2
C. 3
D. 4
Question 12
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's current input prices are w = ₦200 and r = ₦400, and the current output price is p = ₦800, calculate the firm's optimal input mix (L, K) u\sing the Hotelling's Lemma. Assume that the firm's objective is to maximize profits.
A. L = 200, K = 100
B. L = 100, K = 200
C. L = 250, K = 100
D. L = 100, K = 250
Question 13
A consumer's indifference curve is given by the equation U = 2x + 3y. If the consumer's current consumption bundle is (x, y) = (2, 4), what is the consumer's marginal rate of substitution (MRS)?
A. 1/2
B. 1
C. 2
D. 3
Question 14
Determine the price elasticity of demand for a product whose price elasticity of demand is 0.5 and the quantity demanded decreases by 20% when the price increases by 10%.
A. Unit Elastic
B. Inelastic
C. Elastic
D. Perfectly Elastic
Question 15
The government of Nigeria has introduced a new tax policy aimed at increa\sing revenue from the agricultural sector. The policy includes a 10% tax on all agricultural produce sold in the market. If the total revenue from the sale of agricultural produce is ₦1,500,000, what is the amount of tax paid by the farmers?
A. ₦150,000
B. ₦1,500,000
C. ₦1,000,000
D. ₦200,000

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