POST UTME JOSEPH AYO BABALOLA UNIVERSITY 2019 Economics | Objective

Are you preparing for POST UTME JOSEPH AYO BABALOLA UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2019 Economics (Objective) questions designed to simulate the real exam environment.

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Question 1
A monopolistically competitive firm faces a downward-sloping demand curve. If the firm increases its output from Q1 to Q2, what happens to its average revenue (AR)?
A. Increases
Correct B. Decreases
C. Remains the same
D. First increases then decreases

Correct Answer: B

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Question 2
A consumer has a budget of ₦1000 and faces the following prices for two goods: Good X \costs ₦200 and Good Y \costs ₦300. If the consumer buys 2 units of Good X, how much money is left for Good Y?
Correct A. ₦400
B. ₦500
C. ₦600
D. ₦700

Correct Answer: A

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Question 3
A firm is operating in a perfectly competitive market. If the firm's marginal revenue (MR) is greater than its marginal \cost (MC), what will happen to the firm's output?
Correct A. Increase output
B. Decrease output
C. Keep output the same
D. Increase price

Correct Answer: A

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Question 4
A consumer has a utility function U(X,Y) = 2X + 3Y. If the prices of X and Y are ₦2 and ₦3 respectively, and the consumer has a budget of ₦15, how many units of X will the consumer buy?
A. 3
Correct B. 4
C. 5
D. 6

Correct Answer: B

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Question 5
A central bank increases the money supply in an economy. What will happen to the price level?
Correct A. Increases
B. Decreases
C. Remains the same
D. No effect

Correct Answer: A

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Question 6
A firm's total revenue is given by the equation TR = 100x - 2x^2, where x is the number of units sold. If the firm's marginal revenue is 80 when x = 20, what is the value of the firm's total revenue at x = 30?
A. ₦12000
B. ₦13000
Correct C. ₦14000
D. ₦15000

Correct Answer: C

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Question 7
The government of Nigeria has introduced a policy to increase the production of rice in the country. The policy involves providing subsidies to farmers who produce rice. If the government provides a subsidy of ₦500 per bag of rice, and the price of rice is ₦2000 per bag, what is the new price of rice after the subsidy?
A. ₦1500
Correct B. ₦2000
C. ₦2500
D. ₦3000

Correct Answer: B

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Question 8
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 income is ₦1000 and the prices of good X and good Y are ₦200 and ₦300 respectively, what is the consumer's optimal bundle of goods?
A. x = 2, y = 1
Correct B. x = 3, y = 2
C. x = 4, y = 3
D. x = 5, y = 4

Correct Answer: B

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Question 9
A firm is operating in a perfectly competitive market. The firm's supply function is given by Q = 100 - 2P, where P is the price of the firm's product. If the demand for the firm's product is given by Q = 200 - 4P, what is the equilibrium price and quantity of the firm's product?
A. P = ₦100, Q = 50
B. P = ₦150, Q = 75
Correct C. P = ₦200, Q = 100
D. P = ₦250, Q = 125

Correct Answer: C

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Question 10
A monopolist is operating in a market where the demand function is given by Q = 100 - 2P. The monopolist's marginal \cost function is given by MC = 10 + 2Q. If the monopolist's fixed \cost is ₦1000, what is the monopolist's optimal price and quantity?
A. P = ₦150, Q = 50
B. P = ₦200, Q = 75
C. P = ₦250, Q = 100
Correct D. P = ₦300, Q = 125

Correct Answer: D

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Question 11
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's fixed \cost is ₦5000 and its variable \cost is ₦20 per unit, what is the break-even point?
A. ₦10,000
Correct B. ₦15,000
C. ₦20,000
D. ₦25,000

Correct Answer: B

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Question 12
A country's GDP is ₦100 billion, its imports are ₦20 billion, and its exports are ₦15 billion. What is its GDP at market price?
A. ₦95 billion
Correct B. ₦105 billion
C. ₦115 billion
D. ₦125 billion

Correct Answer: B

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Question 13
A consumer has a budget of ₦1000 and faces the following price schedule: x units at ₦20 each, y units at ₦30 each, and z units at ₦40 each. If the consumer buys 10 units, how much does the consumer sp\end?
A. ₦200
B. ₦300
Correct C. ₦400
D. ₦500

Correct Answer: C

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Question 14
A firm's demand function is given by the equation Q = 100 - 2P, where Q is the quantity demanded and P is the price. If the firm's marginal revenue is ₦50, what is the price elasticity of demand?
A. 1
Correct B. 2
C. 3
D. 4

Correct Answer: B

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Question 15
A country's GNP is ₦120 billion, its net factor income from abroad is ₦10 billion, and its depreciation is ₦5 billion. What is its GDP?
A. ₦115 billion
Correct B. ₦120 billion
C. ₦125 billion
D. ₦130 billion

Correct Answer: B

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Question 16
Suppose 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 supply of the product is given by the equation Qs = 2P - 50, where Qs is the quantity supplied, find the equilibrium price and quantity.
A. ₦150
Correct B. ₦200
C. ₦250
D. ₦300

Correct Answer: B

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Question 17
A firm has a total revenue function given by TR = 100x - 2x^2, where x is the number of units produced and sold. If the firm's total \cost function is given by TC = 50x + 100, find the profit-maximizing level of production.
A. 20
B. 30
Correct C. 40
D. 50

Correct Answer: C

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Question 18
The government of a country imposes a tax on a particular good, cau\sing the supply curve to shift from S to S'. If the demand curve remains unchanged, and the new equilibrium price is ₦120, find the tax rate.
A. 10
B. 20
Correct C. 30
D. 40

Correct Answer: C

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Question 19
A firm is considering two production techno\logies: a traditional techno\logy that requires 10 units of labor to produce 100 units of output, and a modern techno\logy that requires 5 units of labor to produce 150 units of output. If the firm's production function is given by Q = f(L), where Q is the quantity produced and L is the number of units of labor, find the returns to scale.
Correct A. Increa\sing
B. Decrea\sing
C. Cons\tant
D. Negative

Correct Answer: A

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Question 20
The government of a country is considering a policy to promote agricultural development. One option is to provide subsidies to farmers, while another option is to invest in irrigation infrastructure. If the government's objective is to maximize agricultural output, which policy is more effective?
A. Subsidies
Correct B. Irrigation infrastructure
C. Both are equally effective
D. Neither is effective

Correct Answer: B

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Question 21
The concept of comparative advantage in international trade is based on the idea that countries should specialize in producing goods for which they have a lower opportunity \cost. Which of the following statements best describes the opportunity \cost of a country?
Correct A. The value of the next best alternative
B. The quantity of the next best alternative
C. The price of the next best alternative
D. The quality of the next best alternative

Correct Answer: A

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Question 22
A government imposes a tax on a good, cau\sing the supply curve to shift to the left. What is the effect on the equilibrium price and quantity of the good?
A. The equilibrium price and quantity decrease
Correct B. The equilibrium price increases and the quantity decreases
C. The equilibrium price and quantity increase
D. The equilibrium price decreases and the quantity increases

Correct Answer: B

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Question 23
A consumer's utility function is given by 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?
A. x = 40, y = 20
Correct B. x = 30, y = 30
C. x = 20, y = 40
D. x = 10, y = 50

Correct Answer: B

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Question 24
A firm's production function is given by Q = 2L + 3K. If the firm's output is 100 units and the wage rate is ₦10 per hour, what is the firm's optimal level of labor?
A. L = 10
Correct B. L = 20
C. L = 30
D. L = 40

Correct Answer: B

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Question 25
A country's balance of payments account is given by the following equation: BOP = X - M + F - I. If the country's exports are ₦1000, imports are ₦500, foreign investment is ₦200, and interest payments are ₦300, what is the country's balance of payments?
Correct A. BOP = ₦200
B. BOP = ₦300
C. BOP = ₦400
D. BOP = ₦500

Correct Answer: A

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