Practice Post UTME RSU economics 2021 Past Questions

Question 1

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 wants to increase its output by 20% while keeping labor cons\tant at 16 units, how much capital (in units) must it invest?

A. 32

B. 64

Correct C. 128

D. 256

Correct Answer: C

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Question 2

A consumer's demand function for a product is given by Q = 100 - 2P, where Q is the quantity demanded and P is the price. If the price of the product increases by 20%, what is the new quantity demanded?

Correct A. 80

B. 60

C. 40

D. 20

Correct Answer: A

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Question 3

A firm's \cost function is given by C = 2L + 3K, where C is \cost, L is labor, and K is capital. If the firm wants to minimize its \cost while producing 100 units of output, and the wage rate is ₦10 per unit of labor, and the rental rate is ₦20 per unit of capital, how much capital (in units) should it invest?

A. 2

B. 4

Correct C. 6

D. 8

Correct Answer: C

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Question 4

A consumer's budget constraint is given by 2Q + 3P = ₦100, where Q is the quantity consumed and P is the price. If the price of the product increases by 20%, and the consumer wants to maximize her utility, what is the new quantity consumed?

A. 20

B. 30

Correct C. 40

D. 50

Correct Answer: C

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Question 5

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 wants to increase its output by 20% while keeping labor cons\tant at 16 units, how much capital (in units) must it invest?

A. 32

B. 64

Correct C. 128

D. 256

Correct Answer: C

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Question 6

A firm's average total \cost curve is U-shaped. What does this imply about the firm's production techno\logy?

A. The firm's production techno\logy exhibits increa\sing returns to scale.

B. The firm's production techno\logy exhibits decrea\sing returns to scale.

Correct C. The firm's production techno\logy exhibits cons\tant returns to scale.

D. The firm's production techno\logy exhibits increa\sing marginal \costs.

Correct Answer: C

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Question 7

A monopolist faces a demand curve given by Q = 100 - 2P. The monopolist's marginal revenue function is given by MR = 50 - 2Q. What is the monopolist's optimal price?

A. ₦25

Correct B. ₦30

C. ₦35

D. ₦40

Correct Answer: B

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Question 8

A firm's production function is given by Q = 2L^2 + 3K. The firm's \cost function is given by C = 2L + 3K. What is the firm's marginal product of labor?

A. 4L

Correct B. 6L

C. 8L

D. 10L

Correct Answer: B

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Question 9

A firm's demand curve is given by Q = 100 - 2P. The firm's supply curve is given by Q = 2P. What is the equilibrium price?

A. ₦20

Correct B. ₦25

C. ₦30

D. ₦35

Correct Answer: B

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Question 10

A firm's production function is given by Q = 2L^2 + 3K. The firm's \cost function is given by C = 2L + 3K. What is the firm's average product of labor?

A. 2L

B. 3L

Correct C. 4L

D. 5L

Correct Answer: C

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Question 11

A monopolist faces a demand curve given by Q = 100 - 2P and a \cost function C(Q) = 2Q^2 + 10Q. If the monopolist's marginal revenue is MR = 200 - 4Q, find the profit-maximizing quantity.

A. 50

B. 75

Correct C. 100

D. 125

Correct Answer: C

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Question 12

A firm is producing a good with a production function F(L,K) = L^0.4 K^0.6. If the firm has 100 units of labor and 50 units of capital, find the value of the production function at these input levels.

A. 100

B. 150

Correct C. 200

D. 250

Correct Answer: C

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Question 13

A consumer has an income of ₦1000 and faces a price of ₦50 for a good. The consumer's demand function is Q = 20 - 2P. Find the consumer's budget constraint.

Correct A. Q = 20 - 2P

B. Q = 10 - P

C. Q = 5 - P

D. Q = 2 - P

Correct Answer: A

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Question 14

A firm is producing a good with a production function F(L,K) = L^0.4 K^0.6. If the firm has 100 units of labor and 50 units of capital, find the value of the marginal product of labor.

A. 0.4

B. 0.6

Correct C. 0.8

D. 1.0

Correct Answer: C

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Question 15

A consumer has an income of ₦1000 and faces a price of ₦50 for a good. The consumer's demand function is Q = 20 - 2P. Find the consumer's indifference curve.

Correct A. Q = 20 - 2P

B. Q = 10 - P

C. Q = 5 - P

D. Q = 2 - P

Correct Answer: A

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Question 16

A firm's \cost function is given by C(q) = 2q^2 + 10q + 5. If the firm produces 20 units, what is the total \cost?

A. ₦1500

Correct B. ₦2000

C. ₦2500

D. ₦3000

Correct Answer: B

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Question 17

A consumer's utility function is given by U(x, y) = 2x + 3y. If the consumer has a budget constraint of 100 and the prices of x and y are 5 and 3 respectively, what is the optimal bundle of x and y?

A. x = 10, y = 10

Correct B. x = 15, y = 5

C. x = 20, y = 0

D. x = 0, y = 20

Correct Answer: B

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Question 18

A monopolist has a demand function given by p = 100 - 2q. If the firm's marginal \cost is 10, what is the optimal quantity to produce?

A. 20

B. 30

Correct C. 40

D. 50

Correct Answer: C

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Question 19

A country's balance of payments is given by the following table:\n\n| Item | Value |\n| --- | --- |\n| Exports | ₦1000 |\n| Imports | ₦1500 |\n| Net Factor Income | ₦200 |\n| Net Transfer | ₦300 |\n\nWhat is the country's balance of payments?

A. ₦-500

Correct B. ₦0

C. ₦500

D. ₦1000

Correct Answer: B

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Question 20

A firm's demand function is given by q = 100 - 2p. If the firm's elasticity of demand is 0.5, what is the price elasticity of supply?

A. 0.5

Correct B. 1

C. 2

D. 3

Correct Answer: B

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Question 21

A firm operating under perfect competition faces a market demand curve that is linear and downward-sloping. If the firm's marginal revenue (MR) curve intersects the market demand curve at a point where the price is ₦100, and the quantity demanded at this price is 100 units, what is the firm's total revenue (TR) at this point?

Correct A. ₦10,000

B. ₦12,000

C. ₦15,000

D. ₦20,000

Correct Answer: A

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Question 22

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 budget constraint is 10x + 5y = 50, and the prices of the two goods are ₦5 and ₦10 respectively, what is the consumer's optimal bundle of goods?

Correct A. (5, 5)

B. (10, 0)

C. (0, 10)

D. (5, 10)

Correct Answer: A

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Question 23

A firm's \cost function is given by C(q) = 2q^2 + 5q + 10, where q is the quantity produced. If the firm's revenue function is R(q) = 20q, what is the firm's profit-maximizing quantity?

A. 5

Correct B. 10

C. 15

D. 20

Correct Answer: B

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Question 24

A firm operating under monopoly faces a demand curve that is given by Qd = 100 - 2P, where P is the price. If the firm's marginal \cost (MC) is cons\tant at ₦10, what is the firm's profit-maximizing price?

A. ₦40

Correct B. ₦50

C. ₦60

D. ₦70

Correct Answer: B

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Question 25

A consumer's indifference curve is given by U(x,y) = 2x + 3y, where x and y are the quantities of two goods consumed. If the consumer's budget constraint is 10x + 5y = 50, and the prices of the two goods are ₦5 and ₦10 respectively, what is the consumer's optimal bundle of goods?

Correct A. (5, 5)

B. (10, 0)

C. (0, 10)

D. (5, 10)

Correct Answer: A

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