POST UTME UNN 2021 Economics | Objective

Are you preparing for POST UTME UNN exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2021 Economics (Objective) questions designed to simulate the real exam environment.

Practice these randomly selected questions to test your readiness.

Question 1
Consider a firm operating in a perfectly competitive market. If the firm's marginal revenue (MR) curve intersects its marginal \cost (MC) curve at point E, where MR = MC, and the firm is producing at its profit-maximizing level of output, what is the implication of this intersection point for the firm's short-run supply curve?
A. The firm's short-run supply curve is upward-sloping.
Correct B. The firm's short-run supply curve is horizontal.
C. The firm's short-run supply curve is vertical.
D. The firm's short-run supply curve is downward-sloping.

Correct Answer: B

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Question 2
A country's GDP is calculated as the sum of all final goods and services produced within its borders. However, if a foreign-owned firm operating in the country produces goods for export, should these goods be included in the country's GDP?
Correct A. Yes, because the goods are produced within the country's borders.
B. No, because the goods are produced for export.
C. Yes, because the goods are part of the country's production.
D. No, because the goods are not part of the country's consumption.

Correct Answer: A

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Question 3
A firm's demand curve is given by the equation Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. If the firm's supply curve is given by the equation Qs = 2P - 10, where Qs is the quantity supplied and P is the price, what is the equilibrium price and quantity?
Correct A. P = 20, Q = 30
B. P = 30, Q = 20
C. P = 40, Q = 10
D. P = 50, Q = 5

Correct Answer: A

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Question 4
A country's balance of payments (BOP) accounts include the current account and the capital account. The current account includes transactions related to goods and services, while the capital account includes transactions related to investments and loans. What is the primary purpose of the BOP accounts?
A. To measure a country's economic growth.
B. To measure a country's trade deficit or surplus.
C. To measure a country's foreign exchange reserves.
Correct D. To measure a country's overall economic performance.

Correct Answer: D

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Question 5
A firm's revenue function is given by the equation R = 100P - 0.5P^2, where R is the revenue and P is the price. If the firm's \cost function is given by the equation C = 50 + 20P, where C is the \cost and P is the price, what is the firm's profit-maximizing price?
A. P = 10
Correct B. P = 20
C. P = 30
D. P = 40

Correct Answer: B

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Question 6
Agricultural development in Nigeria has been hindered by several factors. Which of the following is NOT a major constraint?
A. Land degradation
B. Climate change
C. Lack of access to credit
Correct D. High population growth rate

Correct Answer: D

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Question 7
The production function for a firm is given by Q = 2L^0.5K^0.5. If the firm increases its capital from 100 to 400, and labor from 100 to 400, what is the percentage increase in output?
A. 50%
B. 100%
Correct C. 200%
D. 300%

Correct Answer: C

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Question 8
A consumer's indifference curve is given by U = 2x + 3y. If the consumer's income is 100, and the prices of x and y are 5 and 10 respectively, what is the consumer's optimal bundle?
Correct A. x = 10, y = 5
B. x = 5, y = 10
C. x = 15, y = 3
D. x = 20, y = 2

Correct Answer: A

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Question 9
A firm's \cost function is given by C = 100 + 2L + 3K. If the firm increases its labor from 50 to 100, and capital from 50 to 100, what is the percentage increase in \cost?
A. 25%
B. 50%
Correct C. 75%
D. 100%

Correct Answer: C

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Question 10
A consumer's utility function is given by U = x^2 + 2y^2. If the consumer's income is 100, and the prices of x and y are 5 and 10 respectively, what is the consumer's optimal bundle?
Correct A. x = 10, y = 5
B. x = 5, y = 10
C. x = 15, y = 3
D. x = 20, y = 2

Correct Answer: A

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Question 11
A firm's demand function is given by Q = 100 - 2P + 3Y. If the price elasticity of demand is measured at the point where Q = 50 and Y = 100, what is the price elasticity of demand?
A. 0.5
Correct B. -0.5
C. 1.5
D. 2.5

Correct Answer: B

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Question 12
A consumer's utility function is given by U = 2x + 3y. If the consumer's budget constraint is given by 2x + 3y = 12, what is the consumer's optimal bundle of x and y?
Correct A. x = 2, y = 4
B. x = 4, y = 2
C. x = 3, y = 3
D. x = 1, y = 5

Correct Answer: A

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Question 13
A firm is operating in a perfectly competitive market. If the firm's marginal revenue is given by MR = 100 - 2Q and the firm's marginal \cost is given by MC = 20 + 2Q, what is the firm's optimal output level?
A. Q = 20
Correct B. Q = 30
C. Q = 40
D. Q = 50

Correct Answer: B

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Question 14
A consumer's demand function is given by Q = 100 - 2P. If the price elasticity of demand is measured at the point where Q = 50, what is the price elasticity of demand?
A. 0.5
Correct B. -0.5
C. 1.5
D. 2.5

Correct Answer: B

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Question 15
A firm is operating in a monopoly market. If the firm's demand function is given by Q = 100 - 2P and the firm's marginal revenue is given by MR = 100 - 2Q, what is the firm's optimal output level?
A. Q = 20
Correct B. Q = 30
C. Q = 40
D. Q = 50

Correct Answer: B

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Question 16
Consider a country with a fixed exchange rate regime. If the country's central bank decides to increase the money supply by 10%, what will be the effect on the balance of payments?
A. The balance of payments will improve due to increased exports.
Correct B. The balance of payments will worsen due to increased imports.
C. The balance of payments will remain unchanged.
D. The balance of payments will improve due to increased imports.

Correct Answer: B

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Question 17
A firm is considering two different production processes to manufacture 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 ₦120,000 and a variable \cost of ₦30 per unit. If the firm produces 1,000 units, what will be the total \cost of production for each process?
Correct A. Process A: ₦150,000; Process B: ₦120,000
B. Process A: ₦120,000; Process B: ₦150,000
C. Process A: ₦180,000; Process B: ₦120,000
D. Process A: ₦180,000; Process B: ₦180,000

Correct Answer: A

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Question 18
A consumer has a budget of ₦10,000 and a utility function given by U(x,y) = 2x + 3y. If the prices of x and y are ₦5 and ₦3 respectively, what is the optimal bundle of x and y that the consumer will choose?
Correct A. (x,y) = (1,2)
B. (x,y) = (2,1)
C. (x,y) = (3,0)
D. (x,y) = (0,3)

Correct Answer: A

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Question 19
A country has a trade deficit of ₦100 billion and a current account deficit of ₦50 billion. What is the balance of payments identity?
A. CA + FA = 0
Correct B. CA - FA = 0
C. CA + FA = CA
D. CA - FA = FA

Correct Answer: B

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Question 20
A firm is considering investing in a new project with a net present value (NPV) of ₦100,000. If the firm's \cost of capital is 10%, what is the internal rate of return (IRR) of the project?
Correct A. 10%
B. 12%
C. 15%
D. 18%

Correct Answer: A

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Question 21
Consider a firm operating in a perfectly competitive market. If the firm's average \cost curve intersects the demand curve at a point where the quantity supplied is 100 units, and the price is ₦100 per unit, what is the firm's total revenue?
A. ₦10,000
Correct B. ₦20,000
C. ₦30,000
D. ₦40,000

Correct Answer: B

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Question 22
A monopolistically competitive firm faces a demand curve with the following equation: Q = 100 - 2P. If the firm's marginal revenue curve is given by MR = 50 - 2Q, what is the firm's optimal price?
A. ₦20
B. ₦30
Correct C. ₦40
D. ₦50

Correct Answer: C

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Question 23
Consider a consumer with the following utility function: U = 2x + 3y. If the consumer's budget constraint is given by 2x + 3y = ₦100, and the prices of x and y are ₦5 and ₦10 respectively, what is the consumer's optimal bundle?
A. (10, 20)
B. (20, 10)
Correct C. (15, 15)
D. (30, 5)

Correct Answer: C

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Question 24
A firm is considering two different production techno\logies: a traditional techno\logy with a production function Q = 2L + 3K, and a modern techno\logy with a production function Q = 4L + 2K. If the firm's \cost of labor is ₦10 per unit, and the \cost of capital is ₦20 per unit, which techno\logy should the firm adopt?
A. Traditional techno\logy
Correct B. Modern techno\logy
C. Either techno\logy is equally efficient
D. Neither techno\logy is efficient

Correct Answer: B

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Question 25
Consider a public finance problem where the government is considering a tax on a particular good. If the tax is imposed, the demand for the good will decrease by 20%. If the tax is not imposed, the demand for the good will increase by 10%. What is the effect of the tax on the government's revenue?
A. Increase in revenue
Correct B. Decrease in revenue
C. No change in revenue
D. Uncertain effect on revenue

Correct Answer: B

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