POST UTME IGBINEDION UNIVERSITY 2023 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A consumer's budget constraint is given by P1Q1 + P2Q2 = I, where P1 and P2 are prices, Q1 and Q2 are quantities, and I is income. If the consumer's income increases by 15% and the prices of both goods remain cons\tant, by what percentage does the consumer's budget increase?
A. 10%
B. 15%
C. 20%
D. 25%
Question 2
A central bank increases the reserve requirement for commercial banks. What is the likely effect on the money supply?
A. Increase
B. Decrease
C. No change
D. Uncertain
Question 3
A consumer is faced with the following budget constraint: 2x + 3y = 12. If the consumer's indifference curve is downward sloping and convex to the origin, what is the implication for the consumer's marginal rate of substitution (MRS)?
A. The MRS is cons\tant along the indifference curve.
B. The MRS increases as the consumer moves along the indifference curve.
C. The MRS decreases as the consumer moves along the indifference curve.
D. The MRS is zero at the point of \tangency with the budget constraint.
Question 4
A firm is operating in a perfectly competitive market. If the firm's average \cost (AC) curve intersects the demand curve at a point where the quantity supplied is 100 units, what is the implication for the firm's profit-maximizing output?
A. The firm will produce 100 units of output.
B. The firm will produce less than 100 units of output.
C. The firm will produce more than 100 units of output.
D. The firm will produce at the point where MC = MR.
Question 5
Consider a firm with a demand curve given by Q = 100 - P and a marginal revenue curve given by MR = 2P. What is the profit-maximizing price?
A. ₦50
B. ₦75
C. ₦100
D. ₦125
Question 6
A central bank is considering a monetary policy action to combat inflation. Which of the following instruments would be most effective in reducing inflation in the short run?
A. Open market operations
B. Reserve requirements
C. Discount rate
D. Foreign exchange intervention
Question 7
A firm is operating on a long-run average \cost curve. If the firm experiences a 20% increase in output, and the average \cost curve shifts to the right, what is the likely effect on the firm's long-run average \cost?
A. The long-run average \cost will decrease
B. The long-run average \cost will increase
C. The long-run average \cost will remain unchanged
D. The effect on the long-run average \cost is ambiguous
Question 8
A country's balance of payments is given by BOP = X - M, where BOP is the balance of payments, X is exports, and M is imports. If exports increase by 20% and imports remain cons\tant, by what percentage does the balance of payments increase?
A. 10%
B. 15%
C. 20%
D. 25%
Question 9
A country's GDP is ₦100 billion, its GNP is ₦120 billion, and its net factor income from abroad is ₦10 billion. What is the country's net national income?
A. ₦110 billion
B. ₦120 billion
C. ₦130 billion
D. ₦140 billion
Question 10
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 labor increases by 20% and capital remains cons\tant, by what percentage does output increase?
A. 10%
B. 20%
C. 30%
D. 40%
Question 11
A firm is considering a policy to reduce its production \costs by 15%. If the firm's current production \costs are ₦500,000 and the demand for its products is inelastic, what is the likely effect on the firm's revenue?
A. Increase in revenue
B. Decrease in revenue
C. No change in revenue
D. Uncertain effect on revenue
Question 12
A consumer's utility function is given by U(x,y) = 2x + 3y, where x is the number of units of good X and y is the number of units of good Y. If the consumer's budget constraint is 10x + 5y = 50, find the optimal values of x and y.
A. x = 2, y = 4
B. x = 4, y = 2
C. x = 5, y = 3
D. x = 3, y = 5
Question 13
A firm is operating in a perfectly competitive market. If the firm experiences a decrease in demand, what is the likely effect on the firm's price?
A. The price will increase
B. The price will decrease
C. The price will remain unchanged
D. The effect on the price is ambiguous
Question 14
A firm's demand function is given by Q = 100 - 2P, where Q is quantity demanded and P is price. If the firm's revenue function is given by R = PQ, what is the firm's marginal revenue function?
A. \( MR = -2P \)
B. \( MR = 2P \)
C. \( MR = P^2 \)
D. \( MR = -P^2 \)
Question 15
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's current input levels are L = 16 and K = 9, what is the marginal product of labor (MPL) at these input levels?
A. 1.5
B. 2.5
C. 3.5
D. 4.5

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