POST UTME ESUT 2019 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A firm is operating in a monopoly market with a demand curve given by Q = 100 - 2P. If the firm's marginal revenue (MR) is ₦50, what is the likely effect on the firm's price?
A. Price increases
B. Price decreases
C. Price remains unchanged
D. Price fluctuates
Question 2
Suppose a firm is operating in a perfectly competitive market with a downward-sloping demand curve. If the firm increases its production level, what will happen to its average revenue (AR) and marginal revenue (MR)?
A. AR and MR will both increase
B. AR will decrease, but MR will remain cons\tant
C. AR will increase, but MR will decrease
D. AR and MR will both decrease
Question 3
A firm is producing a good with a total revenue (TR) of ₦1,500 and a total \cost (TC) of ₦1,200. If the firm's average revenue (AR) is ₦150, what is its average \cost (AC)?
A. ₦100
B. ₦120
C. ₦150
D. ₦180
Question 4
A government imposes a tax on a firm's output. The firm's supply function is given by Q = 2P. If the tax rate is 20%, calculate the new supply function.
A. Q = 2.4P
B. Q = 2.2P
C. Q = 2.6P
D. Q = 2.8P
Question 5
A central bank implements a monetary policy that increases the money supply by 10%. What will be the effect on the general price level?
A. The general price level will increase by 10%
B. The general price level will decrease by 10%
C. The general price level will remain the same
D. The general price level will increase by 20%
Question 6
A firm's production function is given by Q = 2L + 3K, where Q is the quantity produced, L is the labor input, and K is the capital input. If the labor input is 10 units and the capital input is 5 units, calculate the quantity produced.
A. 25 units
B. 30 units
C. 35 units
D. 40 units
Question 7
A government imposes a tax on a commodity, which increases its price by 20%. What will be the effect on the quantity demanded of the commodity?
A. The quantity demanded will increase by 20%
B. The quantity demanded will decrease by 20%
C. The quantity demanded will remain the same
D. The quantity demanded will increase by 10%
Question 8
A firm is considering investing in a new project with a net present value of $1 million. If the \cost of capital is 10%, what is the internal rate of return (IRR) of the project?
A. 5%
B. 10%
C. 15%
D. 20%
Question 9
The Marshall-Lerner condition states that if the sum of the elasticities of demand for imports and exports is greater than 1, then a devaluation of the currency will lead to an improvement in the balance of payments. What is the implication of this condition for a country with an elasticity of demand for imports of 0.8 and an elasticity of demand for exports of 1.2?
A. The country will experience a deterioration in its balance of payments
B. The country will experience no change in its balance of payments
C. The country will experience an improvement in its balance of payments
D. The country will experience a worsening of its trade deficit
Question 10
A firm has a total revenue function of TR = 100x - 2x^2 and a total \cost function of TC = 50 + 20x + 3x^2. What is the profit-maximizing level of output?
A. 5 units
B. 10 units
C. 15 units
D. 20 units
Question 11
A country's agricultural sector is characterized by a high degree of backward and forward linkages. What is the implication of this for the country's overall economic development?
A. The country's economic development will be slowed down
B. The country's economic development will be accelerated
C. The country's economic development will be unaffected
D. The country's economic development will be negatively affected
Question 12
Suppose a firm is operating in a perfectly competitive market with a downward-sloping demand curve. If the firm increases its production from 100 units to 120 units, and the price per unit falls from ₦100 to ₦90, what is the likely effect on the firm's total revenue?
A. Total revenue increases
B. Total revenue decreases
C. Total revenue remains unchanged
D. Total revenue increases at a decrea\sing rate
Question 13
A government imposes a tax on imports to reduce the trade deficit. If the tax rate is 15% and the price elasticity of demand for the imported good is -2, what is the expected change in the quantity demanded of the good?
A. 10% increase
B. 20% decrease
C. 15% decrease
D. 5% increase
Question 14
A country's balance of payments account shows a trade deficit of ₦100 billion and a capital account surplus of ₦50 billion. What is the likely effect on the country's exchange rate?
A. The exchange rate appreciates
B. The exchange rate depreciates
C. The exchange rate remains unchanged
D. The exchange rate fluctuates
Question 15
A monopolistically competitive firm faces a demand curve that can be represented by the equation \( Q = 100 - 2P \). If the firm's marginal revenue (MR) is given by the equation \( MR = 50 - 2Q \), what is the firm's optimal price?
A. ₦25
B. ₦30
C. ₦35
D. ₦40

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