POST UTME COAL CITY UNIVERSITY 2018 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A government imposes a tax on a commodity to reduce its consumption. If the demand for the commodity is inelastic, what will be the effect on the government's revenue?
A. The government's revenue will increase.
B. The government's revenue will decrease.
C. The government's revenue will remain the same.
D. The effect on the government's revenue is uncertain.
Question 2
A government wants to reduce the price of a commodity by 10%. If the original price is ₦100, what will be the new price?
A. ₦90
B. ₦95
C. ₦100
D. ₦105
Question 3
A firm's demand function is given by Q = 100 - 2P. If the firm's price is ₦20, how many units will it sell?
A. 10 units
B. 20 units
C. 30 units
D. 40 units
Question 4
The concept of comparative advantage in international trade suggests that a country should specialize in producing goods for which it has a lower opportunity \cost. What is the opportunity \cost of producing a good in a country with a comparative advantage?
A. The \cost of producing the good
B. The \cost of producing an alternative good
C. The \cost of importing the good
D. The \cost of exporting the good
Question 5
Consider a firm operating in a perfectly competitive market. If the firm's marginal revenue (MR) is greater than its marginal \cost (MC), what will be the effect on the firm's output?
A. The firm will increase its output.
B. The firm will decrease its output.
C. The firm's output will remain unchanged.
D. The firm will enter or exit the market.
Question 6
The government of a country has decided to implement a policy of price control to reduce inflation. However, this policy may lead to a shortage of goods in the market. What is the opportunity \cost of this policy?
A. The opportunity \cost is the reduction in the quality of goods available in the market.
B. The opportunity \cost is the increase in the prices of goods in the market.
C. The opportunity \cost is the reduction in the quantity of goods available in the market.
D. The opportunity \cost is the increase in the demand for goods in the market.
Question 7
A firm is producing a good with a marginal \cost curve that is downward sloping. What is the shape of the firm's average \cost curve?
A. The average \cost curve is upward sloping.
B. The average \cost curve is downward sloping.
C. The average \cost curve is horizontal.
D. The average \cost curve is vertical.
Question 8
The concept of scarcity in economics implies that the production of one good is limited by the availability of resources, which can be used to produce other goods. This is an example of a?
A. Opportunity Cost
B. Diminishing Marginal Utility
C. Law of Increa\sing Costs
D. Law of Diminishing Returns
Question 9
Consider a country with a population of 100 million people, and an average annual income of ₦500,000. What is the country's GDP?
A. ₦50 trillion
B. ₦100 trillion
C. ₦500 trillion
D. ₦1 trillion
Question 10
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's current labor and capital inputs are L = 16 and K = 9, respectively, what is the firm's current output?
A. 24
B. 32
C. 40
D. 48
Question 11
A consumer's indifference curve is downward sloping and convex to the origin. What is the name of this type of indifference curve?
A. Convex Indifference Curve
B. Concave Indifference Curve
C. Linear Indifference Curve
D. Downward Sloping Indifference Curve
Question 12
A firm is producing 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^0.7K^0.3. If the firm is currently u\sing 100 units of labor and 50 units of capital, what is the opportunity \cost of producing one more unit of good X?
A. The opportunity \cost is 0.5 units of good Y.
B. The opportunity \cost is 1 unit of good Y.
C. The opportunity \cost is 1.5 units of good Y.
D. The opportunity \cost is 2 units of good Y.
Question 13
A firm is producing a good with a total revenue of ₦100,000 and a total \cost of ₦80,000. What is the profit of the firm?
A. ₦20,000
B. ₦30,000
C. ₦40,000
D. ₦50,000
Question 14
A government imposes a tax of ₦10 on every unit of a good. If the demand for the good is given by the equation Qd = 100 - 2P, and the supply of the good is given by the equation Qs = 2P - 10, what is the equilibrium price and quantity?
A. P = ₦20, Q = 30
B. P = ₦30, Q = 20
C. P = ₦10, Q = 50
D. P = ₦50, Q = 10
Question 15
The government of Nigeria has introduced a new policy to increase agricultural production by providing subsidies to farmers. However, the policy has been criticized for being too expensive and inefficient. U\sing the concept of opportunity \cost, explain why the government should reconsider its policy.
A. The policy is too expensive and inefficient.
B. The policy is not aligned with the government's economic goals.
C. The policy is not sustainable in the long run.
D. The policy is not effective in increa\sing agricultural production.

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