Practice post utme al-hikmah university economics 2022 Past Questions

Question 1

A country's government imposes a 10% tax on all imports. If the price of a good is $100 and the tax is $15, what is the consumer's surplus?

Correct A. $15

B. $20

C. $25

D. $30

Correct Answer: A

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Question 2

A firm's production function is given by Q = 2L^$ 1/2 $K^$ 1/2 $. If the price of labor is $10 per hour and the price of capital is $20 per unit, and the firm wants to maximize its profit, what is the optimal level of labor?

A. 10 units

Correct B. 20 units

C. 30 units

D. 40 units

Correct Answer: B

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Question 3

A country's GDP is $100 billion, its GNP is $120 billion, and its national income is $110 billion. What is the country's net factor income from abroad?

A. $10 billion

B. $20 billion

Correct C. $30 billion

D. $40 billion

Correct Answer: C

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Question 4

A consumer's utility function is given by U = 2x + 3y. If the prices of x and y are $2 and $3 respectively, and the consumer's income is $10, what is the optimal bundle of x and y?

Correct A. x = 2, y = 3

B. x = 3, y = 2

C. x = 4, y = 1

D. x = 1, y = 4

Correct Answer: A

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Question 5

A country's balance of payments is given by the following equation: BOP = $ X - M $ + $ F - I $. If the country's exports are $100 billion, its imports are $80 billion, its foreign investment is $20 billion, and its domestic investment is $30 billion, what is the country's balance of payments?

A. $10 billion

Correct B. $20 billion

C. $30 billion

D. $40 billion

Correct Answer: B

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Question 6

A firm is faced with a production function given by Q = 100L^0.4K^0.3, where Q is output, L is labor, and K is capital. If the firm is currently u\sing 100 units of labor and 200 units of capital, calculate the marginal product of labor (MPL) and marginal product of capital (MPK).

Correct A. MPL = 0.4, MPK = 0.3

B. MPL = 0.3, MPK = 0.4

C. MPL = 0.4, MPK = 0.6

D. MPL = 0.6, MPK = 0.4

Correct Answer: A

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Question 7

A country's balance of payments (BOP) is given by the following equation: BOP = X - M, where X is exports and M is imports. If the country's exports are $100 billion and imports are $120 billion, what is the balance of payments?

A. $20 billion surplus

Correct B. $20 billion deficit

C. $10 billion surplus

D. $10 billion deficit

Correct Answer: B

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Question 8

A firm is considering two production techno\logies: A and B. Techno\logy A has a fixed \cost of $100,000 and a variable \cost of $50 per unit. Techno\logy B has a fixed \cost of $150,000 and a variable \cost of $30 per unit. If the firm produces 10,000 units, what is the total \cost of each techno\logy?

Correct A. Techno\logy A: $1,550,000, Techno\logy B: $1,350,000

B. Techno\logy A: $1,350,000, Techno\logy B: $1,550,000

C. Techno\logy A: $1,200,000, Techno\logy B: $1,400,000

D. Techno\logy A: $1,400,000, Techno\logy B: $1,200,000

Correct Answer: A

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Question 9

A country's GDP is given by the equation: GDP = C + I + G + $ X - M $, where C is consumption, I is investment, G is government sp\ending, X is exports, and M is imports. If the country's consumption is $500 billion, investment is $100 billion, government sp\ending is $200 billion, exports are $150 billion, and imports are $120 billion, what is the GDP?

Correct A. $1,030 billion

B. $1,030 billion

C. $1,030 billion

D. $1,030 billion

Correct Answer: A

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Question 10

A firm is faced with a production function given by Q = 100L^0.4K^0.3, where Q is output, L is labor, and K is capital. If the firm is currently u\sing 100 units of labor and 200 units of capital, calculate the returns to scale.

Correct A. Increa\sing returns to scale

B. Decrea\sing returns to scale

C. Cons\tant returns to scale

D. No returns to scale

Correct Answer: A

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Question 11

A consumer's indifference curve is downward sloping and convex to the origin. What is the implication of this shape on the consumer's utility function?

A. The consumer's utility function is linear.

B. The consumer's utility function is concave.

Correct C. The consumer's utility function is convex.

D. The consumer's utility function is homogeneous of degree one.

Correct Answer: C

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Question 12

A country's balance of payments is in equilibrium when the current account is equal to the capital account. What is the implication of this equilibrium on the country's exchange rate?

A. The exchange rate will appreciate.

B. The exchange rate will depreciate.

Correct C. The exchange rate will remain cons\tant.

D. The exchange rate will fluctuate.

Correct Answer: C

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Question 13

A firm's \cost function is given by C(q) = 2q^2 + 5q. What is the firm's average \cost function?

Correct A. AC(q) = 2q + 5

B. AC(q) = 4q + 5

C. AC(q) = 2q^2 + 5

D. AC(q) = 4q^2 + 5

Correct Answer: A

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Question 14

A government imposes a tax on a firm's output. What is the effect of this tax on the firm's supply curve?

A. The supply curve shifts to the left.

Correct B. The supply curve shifts to the right.

C. The supply curve becomes steeper.

D. The supply curve becomes flatter.

Correct Answer: B

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Question 15

A consumer's demand curve for a good is given by Qd = 100 - 2P. What is the consumer's demand for the good when the price is ₦50?

A. Qd = 50

Correct B. Qd = 75

C. Qd = 100

D. Qd = 125

Correct Answer: B

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Question 16

A firm faces a downward-sloping demand curve for its product. If the firm increases its price, what will happen to its total revenue?

A. Total revenue will increase

Correct B. Total revenue will decrease

C. Total revenue will remain cons\tant

D. Total revenue will increase at first and then decrease

Correct Answer: B

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Question 17

A country's balance of payments account shows a trade deficit of $100 million. What does this mean?

A. The country is exporting more goods and services than it is importing

Correct B. The country is importing more goods and services than it is exporting

C. The country is neither exporting nor importing any goods and services

D. The country is exporting an equal amount of goods and services as it is importing

Correct Answer: B

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Question 18

A firm's \cost function is given by C(q) = 2q^2 + 5q. What is the marginal \cost function?

Correct A. ( C'(q) = 4q + 5 )

B. ( C'(q) = 2q + 5 )

C. ( C'(q) = 4q - 5 )

D. ( C'(q) = 2q - 5 )

Correct Answer: A

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Question 19

A country's supply curve for a particular good is given by Q = 2P + 10. If the price of the good is $5, how many units will be supplied?

A. 10 units

Correct B. 20 units

C. 30 units

D. 40 units

Correct Answer: B

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Question 20

A firm's demand curve for a particular good is given by Q = 100 - 2P. If the price of the good is $20, how many units will be demanded?

A. 40 units

Correct B. 60 units

C. 80 units

D. 100 units

Correct Answer: B

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Question 21

A consumer's indifference curve is represented by the equation u(x,y) = 2x + 3y = 12. If the consumer's income is ₦1200 and the prices of x and y are ₦4 and ₦6 respectively, what is the consumer's optimal bundle?

Correct A. x = 6, y = 4

B. x = 4, y = 6

C. x = 3, y = 5

D. x = 5, y = 3

Correct Answer: A

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Question 22

A government imposes a tax on a good, cau\sing the supply curve to shift from S to S'. If the demand curve is D and the initial equilibrium price and quantity are ₦10 and 100 units respectively, what is the new equilibrium price and quantity?

Correct A. ₦12, 80 units

B. ₦15, 60 units

C. ₦18, 40 units

D. ₦20, 20 units

Correct Answer: A

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Question 23

A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's current inputs are L = 16 and K = 9, what is the firm's current output?

A. 24

B. 36

Correct C. 48

D. 60

Correct Answer: C

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Question 24

A country's GDP at market price is ₦1000 billion. If the government's subsidies amount to ₦50 billion and the depreciation of capital is ₦20 billion, what is the country's GDP at factor \cost?

A. ₦1030 billion

B. ₦1050 billion

Correct C. ₦1070 billion

D. ₦1090 billion

Correct Answer: C

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Question 25

A firm's production function is given by Q = 3L^0.5K^0.5. If the firm's current inputs are L = 25 and K = 16, what is the firm's current output?

A. 30

B. 36

Correct C. 42

D. 48

Correct Answer: C

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