POST UTME ELIZADE UNIVERSITY 2021 Economics | Objective

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Question 1
A firm's production function is given by Q = 2L^0.5 K^0.5. If the firm's current input levels are L = 16 and K = 9, what is the total product (TP) at these input levels?
A. 4
B. 6
C. 8
D. 10
Question 2
A firm's revenue function is given by R(L,K) = 2L^2K. If the firm's current input levels are L = 3 and K = 2, what is the marginal revenue product of labor?
A. 12
B. 24
C. 36
D. 48
Question 3
A firm operating under perfect competition has a \cost function given by C(q) = 2q^2 + 10q. If the market price is P = 20, what is the profit-maximizing quantity?
A. 10
B. 20
C. 30
D. 40
Question 4
A government imposes a tax of ₦10 on a firm's output. The firm's supply curve is given by Q = 100 - 2P. Find the new supply curve.
A. Q = 100 - 2P
B. Q = 90 - 2P
C. Q = 80 - 2P
D. Q = 70 - 2P
Question 5
A consumer has the following utility function: U(x,y) = 2x + 3y. The prices of x and y are ₦5 and ₦10 respectively. Find the consumer's budget constraint.
A. 2x + 3y = 50
B. 2x + 3y = 100
C. 2x + 3y = 150
D. 2x + 3y = 200
Question 6
A firm has a \cost function given by C(q) = 3q^2 + 20q. If the market price is P = 30, what is the firm's profit-maximizing quantity?
A. 10
B. 20
C. 30
D. 40
Question 7
A firm is considering two different market structures: perfect competition and monopoly. U\sing the concept of market structures, explain how the firm's behavior and outcomes differ between the two structures.
A. The firm produces at a lower price and higher quantity under perfect competition than under monopoly
B. The firm produces at a higher price and lower quantity under perfect competition than under monopoly
C. The firm produces at the same price and quantity under both perfect competition and monopoly
D. The firm produces at a higher price and higher quantity under perfect competition than under monopoly
Question 8
A government is considering a policy to reduce poverty in a developing country. U\sing the concept of economic planning and development, explain how the policy affects the country's economic growth and poverty reduction.
A. The policy increases economic growth and reduces poverty
B. The policy decreases economic growth and increases poverty
C. The policy has no effect on economic growth and poverty reduction
D. The policy increases economic growth but has no effect on poverty reduction
Question 9
A government imposes a tax on a firm's output. If the firm's supply curve is given by Q = 2P - 10 and the tax rate is 20%, what is the firm's new supply curve?
A. Q = 2P - 12
B. Q = 2P - 8
C. Q = 2P - 6
D. Q = 2P - 4
Question 10
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's current inputs are L = 25 and K = 16, what is the firm's current output?
A. 40
B. 50
C. 60
D. 70
Question 11
A consumer's utility function is given by U = 2x + 3y. If the consumer's budget constraint is 2x + 3y = 12, what is the consumer's optimal bundle?
A. (2, 4)
B. (4, 2)
C. (6, 0)
D. (0, 6)
Question 12
Consider a perfectly competitive market with 5 firms, each producing a homogeneous product. If the market demand curve is downward sloping and the firms are price takers, what is the likely outcome for the firms' profit maximization?
A. Each firm will produce at the point where MR = MC.
B. The firms will collude to set a higher price and reduce output.
C. The firms will produce at the point where P = MC.
D. The firms will produce at the point where TR = TC.
Question 13
A government imposes a tax on imports to reduce the trade deficit. However, the tax also increases the \cost of production for domestic firms. U\sing the concept of supply and demand, explain how the tax affects the equilibrium price and quantity of the good in the domestic market.
A. The tax increases the equilibrium price and quantity of the good in the domestic market.
B. The tax decreases the equilibrium price and quantity of the good in the domestic market.
C. The tax has no effect on the equilibrium price and quantity of the good in the domestic market.
D. The tax increases the equilibrium price but decreases the equilibrium quantity of the good in the domestic market.
Question 14
The government of a country decides to implement a policy to reduce the budget deficit by increa\sing taxes on luxury goods. However, this policy may have an adverse effect on the economy as it may lead to a decrease in consumer sp\ending and subsequently a decrease in aggregate demand. Which of the following is a potential consequence of this policy?
A. Increase in government revenue
B. Decrease in consumer sp\ending
C. Increase in aggregate demand
D. Decrease in budget deficit
Question 15
A consumer has the following indifference curve: U(x,y) = 2x + 3y. The prices of x and y are ₦5 and ₦10 respectively. Find the consumer's optimal bundle.
A. x = 10, y = 20
B. x = 20, y = 10
C. x = 30, y = 5
D. x = 5, y = 30

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