POST UTME AFE BABALOLA UNIVERSITY 2024 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A government imposes a tax of ₦10 on every unit of a good. The supply function is given by Q = 100 + 2P. What is the equilibrium price and quantity if the demand function is Q = 100 - 2P?
A. ₦20, 60 units
B. ₦30, 80 units
C. ₦40, 100 units
D. ₦50, 120 units
Question 2
A country's GNP is ₦2,000 billion, its GDP is ₦1,800 billion, and its net factor income from abroad is ₦200 billion. What is its national income?
A. ₦2,000 billion
B. ₦2,100 billion
C. ₦2,200 billion
D. ₦2,300 billion
Question 3
A consumer's budget constraint is given by the equation: \( Y = 120 - 2x \), where ( Y ) is the consumer's income and ( x ) is the amount spent on a particular good. If the consumer's income is $120, what is the maximum amount that can be spent on the good?
A. 30
B. 60
C. 90
D. 120
Question 4
The government of a country is considering a policy to reduce the level of unemployment. The policy involves the creation of new jobs in the public sector. If the government wants to create 1000 new jobs, and the average wage of a public sector employee is 50,000, what will be the total \cost of the policy?
A. ₦50,000,000
B. ₦50,000,000,000
C. ₦5,000,000
D. ₦500,000
Question 5
A firm's supply function is given by Q = 100 + 2P. If the price elasticity of supply is 2, what is the price at which the firm will supply 120 units?
A. ₦20
B. ₦30
C. ₦40
D. ₦50
Question 6
A country's GDP is given by the equation GDP = C + I + G + \( X - M \). If the country's current consumption, investment, government sp\ending, exports, and imports are C = 100, I = 50, G = 75, X = 150, and M = 120, what is the country's GDP?
A. 275
B. 300
C. 325
D. 350
Question 7
A country's GDP is ₦1,500 billion, its imports are ₦400 billion, and its exports are ₦300 billion. What is its balance of trade?
A. ₦100 billion surplus
B. ₦200 billion deficit
C. ₦300 billion surplus
D. ₦400 billion deficit
Question 8
The government of a country has decided to implement a policy to reduce the production of a particular good. Which of the following is a likely consequence of this policy?
A. The price of the good will increase.
B. The quantity demanded of the good will increase.
C. The quantity supplied of the good will decrease.
D. The production of the good will increase.
Question 9
A monopolist firm 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.
A. P = 50, Q = 25
B. P = 75, Q = 20
C. P = 60, Q = 30
D. P = 40, Q = 40
Question 10
A firm's demand function is given by Q = 100 - 2P. If the price elasticity of demand is -2, what is the price at which the firm will sell 50 units?
A. ₦20
B. ₦30
C. ₦40
D. ₦50
Question 11
A firm is producing a good with a production function Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the price of labor is 10 and the price of capital is 20, and the firm wants to maximize its profit, what will be the marginal product of labor?
A. L^\( -0.5 \)K^0.5
B. L^0.5K^\( -0.5 \)
C. L^0.5K^0.5
D. L^\( -0.5 \)K^\( -0.5 \)
Question 12
A consumer has a utility function given by u(x, y) = 2x + 3y. If the prices of x and y are $2 and $3, respectively, and the consumer has an income of $10, what is the optimal bundle of x and y?
A. x = 2, y = 2
B. x = 3, y = 1
C. x = 1, y = 3
D. x = 4, y = 0
Question 13
The government of a country decides to implement a policy to reduce the consumption of fossil fuels. The policy involves a tax on gasoline and diesel fuel. If the demand for gasoline is given by the equation Q = 100 - 2P, where Q is the quantity demanded and P is the price, and the tax is 10% of the price, what will be the new demand equation after the tax is implemented?
A. Q = 100 - 2\( P + 0.1P \)
B. Q = 100 - 2P - 0.1P
C. Q = 100 - 2\( P - 0.1P \)
D. Q = 100 - 2P + 0.1P
Question 14
A firm is producing a good at a point where the marginal revenue is equal to the marginal \cost. Which of the following is a likely consequence of this situation?
A. The firm is producing at the maximum profit.
B. The firm is producing at the minimum \cost.
C. The firm is producing at the break-even point.
D. The firm is producing at a loss.
Question 15
A consumer is faced with a budget constraint of $100 and a price of $20 for a particular good. Which of the following is a likely consequence of this situation?
A. The consumer will buy 4 units of the good.
B. The consumer will buy 3 units of the good.
C. The consumer will buy 2 units of the good.
D. The consumer will not buy any units of the good.

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