POST UTME VERITAS UNIVERSITY 2025 Economics | Objective

Are you preparing for POST UTME VERITAS UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2025 Economics (Objective) questions designed to simulate the real exam environment.

Practice these randomly selected questions to test your readiness.

Question 1
A country's economic growth is often measured by its GDP. However, GDP has some limitations. What is one of the main criticisms of GDP as a measure of economic growth?
Correct A. GDP does not account for income inequality.
B. GDP does not account for the environmental impact of economic activity.
C. GDP does not account for the quality of goods and services produced.
D. GDP does not account for the distribution of income among different sectors of the economy.

Correct Answer: A

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Question 2
In a perfectly competitive market, the supply curve is typically upward-sloping. What is the main reason for this?
Correct A. Firms are willing to produce more at higher prices.
B. Firms are willing to produce less at lower prices.
C. Firms are willing to produce more at lower prices.
D. Firms are willing to produce less at higher prices.

Correct Answer: A

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Question 3
A consumer's indifference curve is typically downward-sloping. What is the main reason for this?
Correct A. The consumer is willing to give up more of one good to get more of another good.
B. The consumer is willing to give up less of one good to get more of another good.
C. The consumer is indifferent to the trade-off between the two goods.
D. The consumer is willing to give up the same amount of one good to get more of another good.

Correct Answer: A

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Question 4
A firm's marginal revenue (MR) curve is typically downward-sloping. What is the main reason for this?
Correct A. The firm's total revenue (TR) is decrea\sing at an increa\sing rate.
B. The firm's TR is increa\sing at a decrea\sing rate.
C. The firm's TR is cons\tant.
D. The firm's TR is decrea\sing at a decrea\sing rate.

Correct Answer: A

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Question 5
A country's inflation rate is typically measured by its Consumer Price Index (CPI). What is one of the main limitations of CPI as a measure of inflation?
Correct A. CPI does not account for changes in the quality of goods and services.
B. CPI does not account for changes in the prices of services.
C. CPI does not account for changes in the prices of goods.
D. CPI does not account for changes in the prices of both goods and services.

Correct Answer: A

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Question 6
The elasticity of demand for a product is 0.5. If the price of the product increases by 10%, what is the percentage change in the quantity demanded?
A. 5%
Correct B. 10%
C. 15%
D. 20%

Correct Answer: B

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Question 7
A firm is producing a good with a production function Q = 2L^0.5K^0.5. If the price of labor increases by 20% and the price of capital increases by 15%, what is the new production level?
A. 10
B. 12
Correct C. 15
D. 18

Correct Answer: C

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Question 8
A consumer has a utility function U = 2X + 3Y. If the price of good X increases by 10% and the price of good Y increases by 15%, what is the new budget constraint?
A. 10X + 15Y = 100
Correct B. 10X + 15Y = 120
C. 10X + 15Y = 150
D. 10X + 15Y = 180

Correct Answer: B

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Question 9
A firm is producing a good with a production function Q = 2L^0.5K^0.5. If the price of labor increases by 20% and the price of capital increases by 15%, what is the new production level?
A. 10
B. 12
Correct C. 15
D. 18

Correct Answer: C

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Question 10
A consumer has a utility function U = 2X + 3Y. If the price of good X increases by 10% and the price of good Y increases by 15%, what is the new budget constraint?
A. 10X + 15Y = 100
Correct B. 10X + 15Y = 120
C. 10X + 15Y = 150
D. 10X + 15Y = 180

Correct Answer: B

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Question 11
Determine the price elasticity of demand for a product whose price is reduced from ₦100 to ₦80, and the quantity demanded increases from 100 units to 120 units.
A. Unit elastic
B. Inelastic
Correct C. Elastic
D. Perfectly elastic

Correct Answer: C

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Question 12
A monopolist faces a demand curve given by Q = 100 - 2P and a \cost function C(Q) = 2Q^2 + 10Q. Find the profit-maximizing price and quantity.
Correct A. P = ₦20, Q = 40
B. P = ₦30, Q = 60
C. P = ₦40, Q = 80
D. P = ₦50, Q = 100

Correct Answer: A

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Question 13
A farmer in Nigeria decides to allocate 100 hectares of land to maize and 50 hectares to rice. If the price of maize is ₦200 per ton and the price of rice is ₦300 per ton, and the yields per hectare are 5 tons for maize and 4 tons for rice, what is the total revenue from both crops?
A. ₦1,500,000
B. ₦1,800,000
Correct C. ₦2,000,000
D. ₦2,500,000

Correct Answer: C

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Question 14
A government in Nigeria imposes a tax of ₦10 per liter on gasoline. If the price of gasoline is ₦150 per liter, and the quantity demanded is 100,000 liters, what is the total tax revenue?
A. ₦1,000,000
Correct B. ₦1,500,000
C. ₦2,000,000
D. ₦2,500,000

Correct Answer: B

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Question 15
A consumer has a budget of ₦10,000 and faces the following prices: Q1 = ₦2,000, Q2 = ₦3,000, Q3 = ₦4,000. If the consumer chooses to buy 2 units of Q1, 3 units of Q2, and 1 unit of Q3, what is the opportunity \cost of the last unit of Q3?
A. ₦2,000
Correct B. ₦3,000
C. ₦4,000
D. ₦5,000

Correct Answer: B

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Question 16
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, find the consumer's optimal bundle of x and y.
Correct A. (x,y) = (40,30)
B. (x,y) = (30,40)
C. (x,y) = (20,50)
D. (x,y) = (50,20)

Correct Answer: A

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Question 17
The demand for a product is given by the equation \( Q_d = 100 - 2P \) and the supply is given by \( Q_s = 2P - 10 \). Find 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 = 0

Correct Answer: A

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Question 18
A firm's production function is given by \( Q = 2L^2 + 3K^2 \). If the firm's output is 100 units and the wage rate is ₦10 per unit of labor, find the optimal level of capital.
A. K = 5 units
Correct B. K = 10 units
C. K = 15 units
D. K = 20 units

Correct Answer: B

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Question 19
A country's balance of payments is given by the equation \( BOP = X - M \), where X is the value of exports and M is the value of imports. If the country's exports are ₦1000 and imports are ₦800, find the balance of payments.
Correct A. BOP = ₦200
B. BOP = ₦300
C. BOP = ₦400
D. BOP = ₦500

Correct Answer: A

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Question 20
A firm's production function is given by \( Q = 2L^2 + 3K^2 \). If the firm's output is 100 units and the wage rate is ₦10 per unit of labor, find the optimal level of labor.
A. L = 5 units
Correct B. L = 10 units
C. L = 15 units
D. L = 20 units

Correct Answer: B

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Question 21
The demand for a product is given by the equation Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. If the price elasticity of demand is 0.5, what is the percentage change in quantity demanded when the price increases by 10%?
A. 5%
Correct B. 10%
C. 15%
D. 20%

Correct Answer: B

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Question 22
A firm's production function is given by Q = 100K^0.5L^0.5, where Q is the output, K is the capital and L is the labor. If the firm wants to increase its output by 20% with a 10% increase in labor, what is the required percentage increase in capital?
A. 5%
B. 10%
Correct C. 15%
D. 20%

Correct Answer: C

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Question 23
A consumer's utility function is given by U = 2x + 3y, where U is the utility and x and y are the quantities of two goods. If the prices of the two goods are 5 and 10 respectively, and the consumer's income is 100, what is the optimal combination of the two goods?
A. x = 10, y = 20
Correct B. x = 15, y = 30
C. x = 20, y = 40
D. x = 25, y = 50

Correct Answer: B

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Question 24
The national income of a country is given by the equation Y = C + I + G, where Y is the national income, C is the consumption, I is the investment and G is the government exp\enditure. If the consumption is 500, the investment is 200 and the government exp\enditure is 300, what is the national income?
A. 1000
B. 1200
Correct C. 1500
D. 1800

Correct Answer: C

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Question 25
A firm's demand function is given by Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. If the price elasticity of demand is 0.5, what is the percentage change in quantity demanded when the price increases by 10%?
A. 5%
Correct B. 10%
C. 15%
D. 20%

Correct Answer: B

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