POST UTME ELIZADE UNIVERSITY 2017 Economics | Objective

Are you preparing for POST UTME ELIZADE UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2017 Economics (Objective) questions designed to simulate the real exam environment.

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Question 1
Determine the equilibrium price and quantity of a commodity when the demand function is given by Qd = 100 - 2P and the supply function is given by Qs = 2P - 10, where Qd and Qs are in units and P is in dollars.
A. $15, 40 units
Correct B. $20, 30 units
C. $25, 20 units
D. $30, 10 units

Correct Answer: B

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Question 2
A firm's total revenue (TR) is given by the equation TR = 100x - 2x^2, where x is the number of units sold. If the firm sells 20 units, what is its total revenue?
A. ₦1000
Correct B. ₦1200
C. ₦1400
D. ₦1600

Correct Answer: B

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Question 3
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 GDP is ₦100 billion, and the values of C, I, G, X, and M are ₦50 billion, ₦20 billion, ₦15 billion, ₦30 billion, and ₦10 billion respectively, what is the value of X?
A. ₦20 billion
B. ₦25 billion
Correct C. ₦30 billion
D. ₦35 billion

Correct Answer: C

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Question 4
A firm's marginal \cost (MC) is given by the equation MC = 2x + 5, where x is the number of units produced. If the firm produces 10 units, what is its marginal \cost?
A. ₦25
B. ₦30
Correct C. ₦35
D. ₦40

Correct Answer: C

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Question 5
A country's GNP is given by the equation GNP = GDP + (net factor income from abroad). If the country's GDP is ₦100 billion, and the net factor income from abroad is ₦10 billion, what is the country's GNP?
A. ₦100 billion
B. ₦110 billion
Correct C. ₦120 billion
D. ₦130 billion

Correct Answer: C

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Question 6
A perfectly competitive market has the following characteristics: (i) A large number of firms producing a homogeneous product, (ii) Free entry and exit, (iii) Perfect knowledge of market conditions, and (iv) Price determined by the intersection of demand and supply curves. Which of the following is NOT a characteristic of a perfectly competitive market?
A. A large number of firms producing a homogeneous product
B. Free entry and exit
C. Perfect knowledge of market conditions
Correct D. Price determined by the government

Correct Answer: D

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Question 7
A country's balance of payments (BOP) accounts can be classified into three main categories: (i) Current account, (ii) Capital account, and (iii) Financial account. Which of the following is NOT a component of the current account?
A. Exports
B. Imports
Correct C. Foreign direct investment
D. Net factor income from abroad

Correct Answer: C

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Question 8
A firm's production function can be represented by the equation Q = f(K, L), where Q is output, K is capital, and L is labor. If the marginal product of labor (MPL) is given by MPL = ∂Q/∂L = 2L, what is the value of the marginal product of capital (MPK) if the firm is currently u\sing 10 units of labor?
A. 20
Correct B. 10
C. 5
D. 0

Correct Answer: B

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Question 9
A country's demand for a particular good can be represented by the demand curve D = 100 - 2P, where D is demand and P is price. If the supply curve is given by S = 2P + 10, what is the equilibrium price and quantity?
Correct A. P^* = 22.5, Q^* = 40
B. P^* = 20, Q^* = 30
C. P^* = 25, Q^* = 35
D. P^* = 30, Q^* = 40

Correct Answer: A

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Question 10
A firm's production function can be represented by the equation Q = f(K, L), where Q is output, K is capital, and L is labor. If the production function is given by Q = 2K^0.5L^0.5, what is the value of the marginal product of labor (MPL) if the firm is currently u\sing 4 units of capital and 4 units of labor?
Correct A. 0.5
B. 1
C. 2
D. 4

Correct Answer: A

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Question 11
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 cons\tant and equal to 2, what is the price at which the quantity demanded is 60?
A. ₦20
Correct B. ₦30
C. ₦40
D. ₦50

Correct Answer: B

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Question 12
A firm produces two goods, X and Y, u\sing two inputs, Labour (L) and Capital (K). The production functions are given by X = 2L + 3K and Y = 4L + 5K. If the firm has 10 units of Labour and 15 units of Capital, what is the total output?
A. 120
B. 150
Correct C. 180
D. 200

Correct Answer: C

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Question 13
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 GDP is ₦100 billion, consumption is ₦30 billion, investment is ₦20 billion, government sp\ending is ₦15 billion, exports are ₦25 billion, and imports are ₦10 billion, what is the value of the trade balance?
A. ₦5 billion
Correct B. ₦10 billion
C. ₦15 billion
D. ₦20 billion

Correct Answer: B

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Question 14
A firm's \cost function is given by the equation TC = 100 + 2Q + 0.5Q^2, where TC is the total \cost and Q is the quantity produced. If the firm produces 20 units, what is the total \cost?
A. ₦250
B. ₦300
Correct C. ₦350
D. ₦400

Correct Answer: C

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Question 15
A country's balance of payments is given by the equation BOP = X - M + \( F - I \), where X is exports, M is imports, F is foreign investment, and I is foreign debt. If the country's balance of payments is ₦10 billion, exports are ₦25 billion, imports are ₦15 billion, foreign investment is ₦5 billion, and foreign debt is ₦3 billion, what is the value of the current account balance?
A. ₦5 billion
Correct B. ₦10 billion
C. ₦15 billion
D. ₦20 billion

Correct Answer: B

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Question 16
In a perfectly competitive market, the demand curve for a firm's product is its
Correct A. marginal revenue curve
B. marginal \cost curve
C. average revenue curve
D. average \cost curve

Correct Answer: A

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Question 17
A monopolist faces a demand curve given by Q = 100 - 2P. The inverse demand function is
Correct A. P = 50 - 0.01Q
B. P = 50 + 0.01Q
C. P = 50 - 0.005Q
D. P = 50 + 0.005Q

Correct Answer: A

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Question 18
A central bank can increase the money supply by
A. buying government securities from the public
B. selling government securities to the public
Correct C. printing more money
D. reducing the reserve requirement for commercial banks

Correct Answer: C

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Question 19
The government can finance its budget deficit by
A. printing more money
B. borrowing from the central bank
Correct C. borrowing from the public
D. reducing government exp\enditure

Correct Answer: C

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Question 20
The price elasticity of demand for a normal good is
Correct A. greater than 1
B. less than 1
C. equal to 1
D. greater than 0

Correct Answer: A

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Question 21
Calculate the price elasticity of demand for a product whose price is reduced from ₦100 to ₦90, and the quantity demanded increases from 100 units to 120 units.
A. 0.5
Correct B. 1.0
C. 1.5
D. 2.0

Correct Answer: B

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Question 22
A firm's total revenue is given by the equation TR = 100x - 2x^2, where x is the number of units sold. Find the price elasticity of demand when the quantity demanded is 50 units.
A. 0.5
Correct B. 1.0
C. 1.5
D. 2.0

Correct Answer: B

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Question 23
A government is considering a policy to increase the production of a certain crop. The supply curve for the crop is given by the equation Q = 100 + 2P, where P is the price per unit. If the government wants to increase production by 10 units, what should be the new price per unit?
A. ₦50
B. ₦60
Correct C. ₦70
D. ₦80

Correct Answer: C

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Question 24
A firm is considering a new investment project with the following cash flows: Year 1: ₦100,000; Year 2: ₦120,000; Year 3: ₦150,000. If the firm's \cost of capital is 10%, what is the net present value of the project?
A. ₦50,000
B. ₦60,000
Correct C. ₦70,000
D. ₦80,000

Correct Answer: C

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Question 25
A country's GDP is given by the equation Y = C + I + G, where C is consumption, I is investment, and G is government sp\ending. If the country's GDP is ₦1 trillion, and the consumption and investment are ₦500 billion and ₦200 billion respectively, what is the government sp\ending?
A. ₦100 billion
B. ₦200 billion
Correct C. ₦300 billion
D. ₦400 billion

Correct Answer: C

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