POST UTME FUTO 2021 Economics | Objective

Are you preparing for POST UTME FUTO exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2021 Economics (Objective) questions designed to simulate the real exam environment.

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Question 1
Determine the value of the elasticity of demand for a firm that experiences a 10% increase in price, resulting in a 5% decrease in quantity demanded.
A. 0.5
Correct B. 1.0
C. 1.5
D. 2.0

Correct Answer: B

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Question 2
A country's GDP is ₦1,500 billion, and its GNP is ₦1,600 billion. What is the net factor income from abroad?
A. ₦100 billion
Correct B. ₦200 billion
C. ₦300 billion
D. ₦400 billion

Correct Answer: B

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Question 3
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm increases its labor input from 4 units to 6 units, and its capital input from 9 units to 16 units, what is the percentage change in output?
A. 10%
B. 20%
C. 30%
Correct D. 40%

Correct Answer: D

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Question 4
A country's balance of payments is given by the following equation: BOP = \( X - M \) + \( F - I \). If the country's exports are ₦500 billion, its imports are ₦600 billion, its foreign investment is ₦200 billion, and its domestic investment is ₦300 billion, what is the balance of payments?
A. ₦-100 billion
B. ₦0 billion
Correct C. ₦100 billion
D. ₦200 billion

Correct Answer: C

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Question 5
A firm's production function is given by Q = 3L^0.7K^0.3. If the firm increases its labor input from 8 units to 12 units, and its capital input from 4 units to 6 units, what is the percentage change in output?
A. 15%
B. 20%
Correct C. 25%
D. 30%

Correct Answer: C

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Question 6
A monopolist faces a demand curve given by Q = 100 - 2P and a \cost function C(Q) = 2Q^2 + 10Q. If the monopolist produces 20 units, what is the total revenue?
A. ₦2000
Correct B. ₦2500
C. ₦3000
D. ₦3500

Correct Answer: B

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Question 7
A consumer has a utility function U(x,y) = 2x + 3y. If the consumer's income is ₦1000 and the prices of x and y are ₦5 and ₦3 respectively, what is the consumer's optimal bundle?
Correct A. (10, 20)
B. (20, 10)
C. (15, 15)
D. (5, 5)

Correct Answer: A

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Question 8
A firm has a production function Q = 2L + 3K. If the firm's \cost function is C(L,K) = 10L + 20K and the firm produces 20 units, what is the total \cost?
A. ₦1000
B. ₦1200
Correct C. ₦1500
D. ₦1800

Correct Answer: C

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Question 9
A firm operates in a perfectly competitive market with a demand curve given by Q = 100 - 2P. If the firm's \cost function is C(Q) = 2Q^2 + 10Q, what is the firm's profit-maximizing output?
A. 10
Correct B. 20
C. 30
D. 40

Correct Answer: B

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Question 10
A government wants to implement a policy to reduce poverty in a country. The government has a budget of ₦100 billion to sp\end on poverty reduction programs. If the government wants to allocate the budget in a way that maximizes the number of people lifted out of poverty, what is the optimal allocation?
A. ₦50 billion to education and ₦50 billion to healthcare
Correct B. ₦30 billion to education and ₦70 billion to healthcare
C. ₦20 billion to education and ₦80 billion to healthcare
D. ₦10 billion to education and ₦90 billion to healthcare

Correct Answer: B

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Question 11
A country's GDP is calculated u\sing the following formula: \( GDP = C + I + G + \( X - M \ \)). If the country's consumption is ₦120 billion, investment is ₦80 billion, government sp\ending is ₦60 billion, exports are ₦100 billion, and imports are ₦80 billion, what is the country's GDP?
A. ₦280 billion
B. ₦300 billion
Correct C. ₦320 billion
D. ₦340 billion

Correct Answer: C

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Question 12
A firm's demand curve is given by the equation \( Q = 100 - 2P \). If the price of the good is ₦20, how many units will the firm sell?
A. 20 units
Correct B. 40 units
C. 60 units
D. 80 units

Correct Answer: B

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Question 13
A country's balance of payments is given by the following equation: \( BOP = X - M + F - C \). If the country's exports are ₦100 billion, imports are ₦80 billion, foreign investment is ₦20 billion, and consumption is ₦60 billion, what is the country's balance of payments?
A. ₦40 billion
Correct B. ₦60 billion
C. ₦80 billion
D. ₦100 billion

Correct Answer: B

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Question 14
A firm's supply curve is given by the equation \( Q = 50 + 2P \). If the price of the good is ₦10, how many units will the firm supply?
A. 50 units
Correct B. 60 units
C. 70 units
D. 80 units

Correct Answer: B

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Question 15
A country's national income is given by the following equation: \( NI = C + I + G + \( X - M \ \)). If the country's consumption is ₦120 billion, investment is ₦80 billion, government sp\ending is ₦60 billion, exports are ₦100 billion, and imports are ₦80 billion, what is the country's national income?
A. ₦280 billion
B. ₦300 billion
Correct C. ₦320 billion
D. ₦340 billion

Correct Answer: C

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Question 16
A firm's production function is given by Q = 100L^0.5K^0.5, where Q is output, L is labor and K is capital. If the firm's labor and capital are 100 units each, what is the marginal product of labor?
Correct A. 50
B. 100
C. 200
D. 500

Correct Answer: A

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Question 17
A country's balance of payments is given by the following equation: BOP = X - M - \( I - S \). If the country's exports (X) are ₦100 billion, imports (M) are ₦80 billion, investment (I) is ₦50 billion and savings (S) is ₦30 billion, what is the balance of payments?
Correct A. ₦20 billion
B. ₦30 billion
C. ₦40 billion
D. ₦50 billion

Correct Answer: A

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Question 18
A firm's demand function is given by Q = 100 - 2P, where Q is quantity demanded and P is price. If the firm's price is ₦50, what is the quantity demanded?
A. 50
Correct B. 75
C. 100
D. 125

Correct Answer: B

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Question 19
A country's agricultural sector is given by the following production function: Q = 100L^0.5K^0.5, where Q is output, L is labor and K is capital. If the country's labor and capital are 100 units each, what is the marginal product of labor?
Correct A. 50
B. 100
C. 200
D. 500

Correct Answer: A

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Question 20
A firm's revenue function is given by R = 100Q - 2Q^2, where R is revenue and Q is quantity sold. If the firm sells 50 units, what is the revenue?
A. ₦2500
B. ₦3000
Correct C. ₦3500
D. ₦4000

Correct Answer: C

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Question 21
A monopolist faces a demand curve given by Q = 100 - 2P and a \cost function C(Q) = 2Q^2 + 10Q. If the firm's marginal revenue is MR = 50 - 2Q, what is the optimal quantity to produce?
A. 25
B. 50
Correct C. 75
D. 100

Correct Answer: C

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Question 22
A firm is considering two projects, A and B. Project A has a \cost of ₦1.5 million and an expected return of ₦2 million, while project B has a \cost of ₦2 million and an expected return of ₦1.8 million. If the firm's \cost of capital is 10%, which project should it choose?
Correct A. Project A
B. Project B
C. Both projects are equally attractive
D. Neither project is attractive

Correct Answer: A

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Question 23
A consumer has a budget of ₦100 and faces a price of ₦10 per unit of a good. If the consumer's utility function is U(x) = 2x^2, what is the optimal quantity to consume?
A. 5
Correct B. 10
C. 15
D. 20

Correct Answer: B

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Question 24
A firm is considering a new investment project with a \cost of ₦5 million and an expected return of ₦6 million. If the firm's \cost of capital is 12%, what is the net present value of the project?
Correct A. ₦1 million
B. ₦500,000
C. ₦0
D. ₦-1 million

Correct Answer: A

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Question 25
A consumer has a utility function U(x,y) = 2x + 3y. If the prices of x and y are ₦10 and ₦20 respectively, and the consumer's budget is ₦100, what is the optimal bundle of x and y?
Correct A. x = 5, y = 2
B. x = 3, y = 4
C. x = 2, y = 5
D. x = 4, y = 3

Correct Answer: A

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