POST UTME BABCOCK UNIVERSITY 2017 Economics | Objective
Practice these randomly selected questions to test your readiness.
Question 1
A consumer has a utility function given by U = 2x + 3y, where x and y are the quantities of two goods. If the consumer has a budget of ₦100 and the prices of the two goods are ₦20 and ₦30 respectively, find the optimal quantities of the two goods.
Question 2
The Central Bank of Nigeria has introduced a new monetary policy aimed at reducing inflation. The policy includes a 5% increase in the reserve requirement for commercial banks. Assuming the money supply is perfectly elastic, what is the expected effect on the price level?
Question 3
A country's inflation rate is given by the equation π = \( P - P^* \) / P^*, where P is the current price level and P^* is the equilibrium price level. If the current price level is ₦100 and the equilibrium price level is ₦90, what is the country's inflation rate?
Question 4
A firm is considering investing in a new project that requires an initial investment of ₦10 million. The project is expected to generate a cash inflow of ₦2 million per annum for 5 years. U\sing the net present value (NPV) method, what is the minimum discount rate required for the project to be acceptable?
Question 5
A consumer is faced with the following utility function: ( U(x,y) = 2x + 3y ). The consumer's budget constraint is \( 2x + 3y = 12 \). U\sing the method of substitution, what is the consumer's optimal bundle of x and y?
Question 6
A country's GDP is given by the equation Y = C + I + G + \( X - M \). If the country's consumption (C) is ₦500 billion, investment (I) is ₦200 billion, government sp\ending (G) is ₦300 billion, exports (X) are ₦400 billion, and imports (M) are ₦200 billion, what is the country's GDP?
Question 7
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 price at which the quantity demanded is 50?
Question 8
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 price at which the quantity demanded is 50?
Question 9
A firm is considering two investment projects. Project A has a \cost of ₦100 million and a return of ₦120 million. Project B has a \cost of ₦80 million and a return of ₦100 million. Which project should the firm choose?
Question 10
Suppose a government imposes a tax of ₦100 on every unit of a good. If the supply curve is given by Q = 2P - 100 and the demand curve is given by Q = 200 - 2P, what is the new equilibrium price and quantity?
Question 11
A firm is considering two production techno\logies: one that requires an initial investment of ₦100 million and produces 100 units of output per year, and another that requires an initial investment of ₦150 million and produces 120 units of output per year. If the firm's objective is to maximize profits, what is the minimum amount of output that the firm must produce per year to justify the higher initial investment?
Question 12
A firm's production function is given by Q = 2L^0.5K^0.5, where Q is output, L is labor, and K is capital. If the firm wants to increase output by 20% while keeping labor cons\tant, what percentage increase in capital is required?
Question 13
A firm's demand function is given by Q = 100 - 2P. If the firm's marginal revenue (MR) is ₦50 and the firm's marginal \cost (MC) is ₦40, what is the firm's optimal price?
Question 14
A monopolist faces a demand curve given by Q = 100 - 2P and a \cost function C(Q) = 2Q^2 + 10Q. Find the deadweight loss of the monopolist's profit-maximizing output.
Question 15
Suppose 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 supply of the product is given by the equation Qs = 2P - 100, where Qs is the quantity supplied, find the equilibrium price and quantity.
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