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POST UTME UNIOSUN 2017 Economics | Objective

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Question 1

A firm's production function is given by Q = 2L^0.5H^0.5. If the price of labor (L) is ₦100 per unit and the price of capital (H) is ₦200 per unit, calculate the total \cost of producing 4 units of output.

A. ₦400

B. ₦800

Correct C. ₦1200

D. ₦1600

Correct Answer: C

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Question 2

A consumer's utility function is given by U = 2x + 3y. If the price of good x is ₦50 and the price of good y is ₦75, find the consumer's budget constraint.

A. ₦150

B. ₦225

Correct C. ₦300

D. ₦375

Correct Answer: C

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Question 3

A firm's \cost function is given by C = 2L + 3H. If the price of labor (L) is ₦100 per unit and the price of capital (H) is ₦200 per unit, calculate the marginal \cost of producing 3 units of output.

A. ₦300

B. ₦400

Correct C. ₦500

D. ₦600

Correct Answer: C

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Question 4

A firm's revenue function is given by R = 2x^2 + 3xy. If the price of good x is ₦50 and the price of good y is ₦75, find the firm's total revenue.

A. ₦1500

B. ₦2250

Correct C. ₦3000

D. ₦3750

Correct Answer: C

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Question 5

A firm is a pure monopolist with a demand function given by Q = 100 - 2P. If the firm's marginal \cost is ₦50, find the firm's profit-maximizing price.

A. ₦40

B. ₦50

Correct C. ₦60

D. ₦70

Correct Answer: C

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Question 6

A consumer's indifference curve is represented by the equation ( U(x,y) = 2x + 3y ). If the consumer's income is ₦1000 and the prices of x and y are ₦5 and ₦3 respectively, what is the consumer's optimal bundle of x and y?

Correct A. x = 40, y = 20

B. x = 30, y = 30

C. x = 20, y = 40

D. x = 10, y = 50

Correct Answer: A

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Question 7

The GDP of a country is ₦100 billion, the GNP is ₦120 billion, and the net factor income from abroad is ₦10 billion. What is the country's net domestic product?

Correct A. ₦110 billion

B. ₦120 billion

C. ₦130 billion

D. ₦140 billion

Correct Answer: A

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Question 8

A central bank increases the reserve requirement for commercial banks. What is the likely effect on the money supply?

A. Increase

Correct B. Decrease

C. No effect

D. Uncertain

Correct Answer: B

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Question 9

A farmer produces 100 units of wheat and 80 units of maize. The prices of wheat and maize are ₦5 and ₦3 respectively. What is the farmer's total revenue?

A. ₦500

Correct B. ₦600

C. ₦700

D. ₦800

Correct Answer: B

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Question 10

A monopolist faces a demand curve given by \( Q = 100 - 2P \) and a \cost function given by \( C = 50 + 2Q \). What is the monopolist's profit-maximizing price?

A. ₦40

Correct B. ₦50

C. ₦60

D. ₦70

Correct Answer: B

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Question 11

The demand for a commodity is said to be elastic if the percentage change in the quantity demanded is greater than the percentage change in the price. What is the condition for the demand to be inelastic?

A. Percentage change in quantity demanded is less than the percentage change in price

B. Percentage change in quantity demanded is greater than the percentage change in price

C. Percentage change in quantity demanded is equal to the percentage change in price

Correct D. Percentage change in quantity demanded is less than or equal to the percentage change in price

Correct Answer: D

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Question 12

A farmer produces 1000 units of wheat at a \cost of ₦10 per unit. If the price of wheat increases by 20%, what is the new \cost of production?

Correct A. ₦12,000

B. ₦11,000

C. ₦10,000

D. ₦9,000

Correct Answer: A

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Question 13

A consumer has a budget of ₦1000 to sp\end on two goods, A and B. The price of good A is ₦200 and the price of good B is ₦300. If the consumer sp\ends all the budget on good A, what is the opportunity \cost of buying good B?

A. ₦200

Correct B. ₦300

C. ₦400

D. ₦500

Correct Answer: B

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Question 14

The GDP of a country is ₦10 trillion. If the GNP is ₦12 trillion, what is the net factor income from abroad?

Correct A. ₦2 trillion

B. ₦1 trillion

C. ₦0.5 trillion

D. ₦0.2 trillion

Correct Answer: A

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Question 15

A firm produces 1000 units of a commodity at a \cost of ₦10 per unit. If the price of the commodity increases by 20%, what is the new \cost of production?

Correct A. ₦12,000

B. ₦11,000

C. ₦10,000

D. ₦9,000

Correct Answer: A

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Question 16

The demand for a commodity is said to be elastic if the percentage change in the quantity demanded is greater than the percentage change in the price. What is the formula for calculating the price elasticity of demand?

Correct A. ED = \frac{\%\,\text{change in quantity demanded}}{\%\,\text{change in price}}

B. ED = \frac{\%\,\text{change in price}}{\%\,\text{change in quantity demanded}}

C. ED = \frac{\text{change in quantity demanded}}{\text{change in price}}

D. ED = \frac{\text{change in price}}{\text{change in quantity demanded}}

Correct Answer: A

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Question 17

The Nigerian government has implemented a policy to increase agricultural production. Which of the following is a potential benefit of this policy?

Correct A. Increased food security

B. Reduced unemployment

C. Increased foreign exchange earnings

D. Increased government revenue

Correct Answer: A

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Question 18

The production function for a firm 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?

Correct A. 10% increase in labor and 10% increase in capital

B. 20% increase in labor and 20% increase in capital

C. 30% increase in labor and 30% increase in capital

D. 40% increase in labor and 40% increase in capital

Correct Answer: A

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Question 19

The central bank of Nigeria has increased the reserve requirement for commercial banks. What is the likely effect on the money supply?

A. Increase in money supply

Correct B. Decrease in money supply

C. No change in money supply

D. Uncertainty about the effect on money supply

Correct Answer: B

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Question 20

The government has implemented a policy to increase industrialization in Nigeria. Which of the following is a potential benefit of this policy?

Correct A. Increased employment opportunities

B. Increased foreign exchange earnings

C. Increased government revenue

D. Increased food security

Correct Answer: A

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Question 21

A firm operating in a perfectly competitive market will always produce at the point where its marginal revenue equals its marginal \cost. However, this is not the case for a monopolistically competitive firm. Explain why.

Correct A. Because a monopolistically competitive firm faces a downward-sloping demand curve, it will produce at a point where its marginal revenue is greater than its marginal \cost.

B. Because a monopolistically competitive firm has a fixed \cost, it will produce at a point where its marginal revenue is less than its marginal \cost.

C. Because a monopolistically competitive firm faces a cons\tant elasticity of demand, it will produce at a point where its marginal revenue is equal to its marginal \cost.

D. Because a monopolistically competitive firm has a variable \cost, it will produce at a point where its marginal revenue is greater than its marginal \cost.

Correct Answer: A

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Question 22

Agricultural development in Nigeria has been hindered by several factors. Identify and explain two of these factors.

A. Lack of access to credit and high interest rates, leading to low investment in agriculture.

B. Poor infrastructure and lack of storage facilities, leading to post-harvest losses.

C. Inadequate extension services and lack of agricultural research, leading to low productivity.

Correct D. All of the above.

Correct Answer: D

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Question 23

A firm's revenue function is given by R(x) = 100x - 2x^2. Find the marginal revenue function.

Correct A. 100 - 4x

B. 100 + 4x

C. 2x^2 - 100

D. x^2 + 100

Correct Answer: A

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Question 24

The demand for a product is given by the equation Qd = 100 - 2P. The supply of the product is given by the equation Qs = 2P. Find the equilibrium price and quantity.

Correct A. P = 25, Q = 50

B. P = 50, Q = 25

C. P = 100, Q = 50

D. P = 50, Q = 100

Correct Answer: A

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Question 25

A firm's \cost function is given by C(x) = 100 + 2x^2. Find the marginal \cost function.

Correct A. 4x

B. 2x^2

C. 100 + 2x^2

D. x^2 + 100

Correct Answer: A

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