POST UTME ABU 2019 Economics | Objective

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Question 1
A firm produces two goods, X and Y, u\sing two inputs, labor and capital. The production function for good X is given by Q_X = 2L^0.5K^0.5, where Q_X is the quantity of good X produced, L is the amount of labor used, and K is the amount of capital used. The production function for good Y is given by Q_Y = 3L^0.2K^0.8. If the firm uses 100 units of labor and 200 units of capital, what is the total output of the firm?
A. 1000
B. 1200
C. 1500
D. 1800
Question 2
A government imposes a tax of ₦10 on a firm's output. If the firm's supply curve is given by Qs = 10 + 3P, find the new supply curve u\sing the diagram below.
A. Qs = 10 + 3P
B. Qs = 20 + 3P
C. Qs = 30 + 3P
D. Qs = 40 + 3P
Question 3
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's current output is 16 units and the number of workers is 4, what is the minimum number of machines required to produce this output?
A. 2
B. 4
C. 8
D. 16
Question 4
A consumer has the following utility function: U = 2X + 3Y, where X and Y are the quantities of two goods consumed. The prices of the two goods are $2 and $3, respectively. The consumer's income is $20. What is the consumer's optimal consumption bundle?
A. X = 4, Y = 2
B. X = 2, Y = 4
C. X = 3, Y = 3
D. X = 1, Y = 1
Question 5
A firm's production function is given by Q = 3L^0.5K^0.5. If the firm's current output is 9 units and the number of workers is 1, what is the minimum number of machines required to produce this output?
A. 1
B. 2
C. 3
D. 4
Question 6
A firm is producing two goods, x and y, with the following production function: \( x + 2y = 100 \). If the price of x is ₦5 and the price of y is ₦3, find the firm's optimal production levels of x and y.
A. x = 50, y = 25
B. x = 40, y = 30
C. x = 30, y = 35
D. x = 20, y = 40
Question 7
A consumer's indifference curve is given by U = 2x + 3y. If the consumer's current utility level is 15 and the price of good x is ₦5, what is the maximum amount the consumer is willing to pay for good y?
A. ₦10
B. ₦15
C. ₦20
D. ₦25
Question 8
The government of Nigeria has set a target of increa\sing the country's agricultural production by 20% within the next 5 years. If the current agricultural production is ₦500 billion, what is the total amount of money the government needs to invest in the agricultural sector to achieve this target?
A. ₦100 billion
B. ₦150 billion
C. ₦200 billion
D. ₦250 billion
Question 9
A consumer in Nigeria has a budget of ₦10,000 to sp\end on two goods, X and Y. The price of good X is ₦5,000 and the price of good Y is ₦3,000. If the consumer sp\ends all of their budget on the two goods, what is the opportunity \cost of buying one more unit of good X?
A. ₦1,000
B. ₦2,000
C. ₦3,000
D. ₦5,000
Question 10
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 price elasticity of demand is unit elastic, what is the optimal quantity of the good that the firm should produce?
A. \( Q^* = \frac{P}{pi} \)
B. \( Q^* = \frac{P}{MC} \)
C. \( Q^* = \frac{MR}{MC} \)
D. \( Q^* = \frac{MC}{MR} \)
Question 11
The opportunity \cost of producing one more unit of a good is the value of the next best alternative that must be given up. This concept is closely related to the law of increa\sing opportunity \cost. Which of the following is a correct statement of the law of increa\sing opportunity \cost?
A. As the quantity of a good increases, the opportunity \cost of producing one more unit decreases.
B. As the quantity of a good increases, the opportunity \cost of producing one more unit increases.
C. The opportunity \cost of producing one more unit of a good is cons\tant and does not change with the quantity produced.
D. The opportunity \cost of producing one more unit of a good is zero and does not dep\end on the quantity produced.
Question 12
A monopolist faces a demand curve given by Qd = 100 - 2P and a marginal revenue curve given by MR = 20 - 2P. Find the profit-maximizing price and quantity u\sing the diagram below.
A. ₦30, Q = 40
B. ₦40, Q = 30
C. ₦50, Q = 20
D. ₦60, Q = 10
Question 13
A perfectly competitive market has the following characteristics: (a) A \single buyer or seller, (b) A homogeneous product, (c) Free entry and exit, (d) Price-making power. Which of the following is NOT a characteristic of a perfectly competitive market?
A. A \single buyer or seller
B. A homogeneous product
C. Free entry and exit
D. Price-making power
Question 14
The concept of consumer behavior is closely related to the concept of utility. Which of the following best describes the relationship between consumer behavior and utility?
A. Consumer behavior is the study of how consumers make decisions about what products to buy.
B. Consumer behavior is the study of how consumers make decisions about how much to sp\end on products.
C. Consumer behavior is the study of how consumers make decisions about which products to buy.
D. Consumer behavior is the study of how consumers make decisions about when to buy products.
Question 15
A consumer's indifference curve is given 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.
A. x = 40, y = 20
B. x = 30, y = 30
C. x = 20, y = 40
D. x = 10, y = 50

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