POST UTME ACHIEVERS UNIVERSITY 2021 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A firm is producing a good with the following \cost function: C(q) = 2q^2 + 10q + 100. If the firm's revenue function is R(q) = 20q, what is the profit-maximizing output level?
A. 10 units
B. 20 units
C. 30 units
D. 40 units
Question 2
A government is considering a policy to increase the price of a commodity by 10%. However, the policy is expected to lead to a decrease in demand by 5%. What is the likely impact of the policy on the government's revenue?
A. The government's revenue will increase by 5%.
B. The government's revenue will decrease by 5%.
C. The government's revenue will remain the same.
D. The government's revenue will increase by 10%.
Question 3
A firm's elasticity of supply is given by E = 2. If the price of the good increases by 20%, what is the percentage change in quantity supplied?
A. 40%
B. 60%
C. 80%
D. 100%
Question 4
A firm's \cost function is given by ( C(q) = 2q^2 + 5q + 10 ). If the firm produces 5 units of output, what is the total \cost?
A. ₦125
B. ₦150
C. ₦175
D. ₦200
Question 5
A country's economic planning involves the use of fiscal policy to achieve macroeconomic objectives. Which of the following is NOT a tool of fiscal policy?
A. Government sp\ending
B. Taxation
C. Monetary policy
D. Fiscal policy
Question 6
The Central Bank of Nigeria (CBN) uses monetary policy tools to control inflation. Which of the following is NOT a monetary policy tool used by the CBN?
A. Open Market Operations (OMO)
B. Reserve Requirements
C. Fiscal Policy
D. Credit Controls
Question 7
A government is considering a tax on a particular good to raise revenue. If the tax is imposed and the demand for the good is inelastic, what is the expected effect on the price of the good?
A. The price of the good will increase.
B. The price of the good will decrease.
C. The price of the good will remain unchanged.
D. The price of the good will increase by a smaller amount than the tax.
Question 8
A consumer has a budget of ₦1000 and faces the following prices for two goods: good X at ₦200 and good Y at ₦300. 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. ₦100
B. ₦200
C. ₦300
D. ₦400
Question 9
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 100 units of output, what is the implication of this intersection point on the firm's profit-maximizing output level?
A. The firm is producing at its minimum point on the average total \cost (ATC) curve.
B. The firm is producing at its maximum point on the average total \cost (ATC) curve.
C. The firm is producing at its minimum point on the average variable \cost (AVC) curve.
D. The firm is producing at its maximum point on the average variable \cost (AVC) curve.
Question 10
A firm is producing a good with the following production function: Q = 2L^0.5K^0.5, where Q is the output, L is the labor, and K is the capital. If the firm increases the labor from 4 units to 6 units, what is the percentage change in output?
A. 10%
B. 20%
C. 30%
D. 40%
Question 11
A firm is producing a good with the following total revenue function: TR = 2x^2 + 10x + 5, where x is the number of units produced. If the firm produces 5 units, what is the marginal revenue?
A. ₦20
B. ₦30
C. ₦40
D. ₦50
Question 12
A firm's revenue function is given by the equation R(x) = 100x - 2x^2, where x is the number of units sold. If the firm sells 20 units, find the total revenue.
A. 1000
B. 1200
C. 1400
D. 1600
Question 13
The Marshall-Lerner condition states that a country's balance of payments will improve if the sum of the percentage changes in its export and import prices exceeds the percentage change in its exchange rate. Which of the following scenarios would lead to an improvement in the balance of payments?
A. A 10% increase in export prices and a 5% decrease in import prices
B. A 5% decrease in export prices and a 10% increase in import prices
C. A 10% increase in export prices and a 10% increase in import prices
D. A 5% decrease in export prices and a 5% decrease in import prices
Question 14
A country's GDP is calculated as the sum of the value of all final goods and services produced within its borders. However, the country also imports goods worth ₦100 billion and exports goods worth ₦120 billion. What is the country's balance of payments?
A. The country has a trade deficit of ₦20 billion.
B. The country has a trade surplus of ₦20 billion.
C. The country has a balance of payments deficit of ₦20 billion.
D. The country has a balance of payments surplus of ₦20 billion.
Question 15
A firm's production function is given by Q = 2L^0.5K^0.5. Which of the following is NOT a characteristic of the production function?
A. Increa\sing returns to scale
B. Decrea\sing returns to scale
C. Cons\tant returns to scale
D. Increa\sing marginal product of labor

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