Practice post utme nile university economics 2022 Past Questions

Question 1

A firm's production function is given by Q = 2L^$ 1/2 $K^$ 1/2 $. If the firm's output is 16 units when the number of labor units is 4 and the number of capital units is 4, what is the marginal product of labor?

Correct A. 4

B. 6

C. 8

D. 10

Correct Answer: A

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Question 2

A country's balance of payments is given by the following equation: BOP = $ X - M $ + $ F - I $. If the country's exports are $100 billion, imports are $80 billion, foreign investment is $20 billion, and domestic investment is $30 billion, what is the balance of payments?

Correct A. $10 billion

B. $20 billion

C. $30 billion

D. $40 billion

Correct Answer: A

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Question 3

A consumer's utility function is given by U = 2x + 3y. If the consumer's income is $100 and the prices of x and y are $5 and $10 respectively, what is the consumer's optimal bundle?

A. (10, 10)

Correct B. (15, 5)

C. (20, 0)

D. (0, 20)

Correct Answer: B

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Question 4

A firm's production function is given by Q = 3L^2K. If the firm's output is 27 units when the number of labor units is 3 and the number of capital units is 1, what is the marginal product of labor?

A. 9

Correct B. 12

C. 15

D. 18

Correct Answer: B

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Question 5

A country's balance of payments is given by the following equation: BOP = $ X - M $ + $ F - I $. If the country's exports are $120 billion, imports are $100 billion, foreign investment is $25 billion, and domestic investment is $35 billion, what is the balance of payments?

A. $10 billion

Correct B. $20 billion

C. $30 billion

D. $40 billion

Correct Answer: B

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Question 6

A firm faces a downward-sloping demand curve and has a cons\tant marginal \cost of production. If the firm's marginal revenue is equal to its marginal \cost, what is the optimal price and quantity of output?

A. The optimal price is the highest price on the demand curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal \cost curve.

B. The optimal price is the lowest price on the demand curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal \cost curve.

Correct C. The optimal price is the price at which the demand curve intersects the marginal revenue curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal \cost curve.

D. The optimal price is the highest price on the demand curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal revenue curve.

Correct Answer: C

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Question 7

A country's GDP is calculated as the sum of consumption, investment, government sp\ending, and net exports. If the country's GDP is $100 billion, and the government sp\ending is $20 billion, what is the sum of consumption and investment?

Correct A. $80 billion

B. $60 billion

C. $40 billion

D. $20 billion

Correct Answer: A

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Question 8

A monopolist faces a demand curve and has a cons\tant marginal \cost of production. If the monopolist's marginal revenue is equal to its marginal \cost, what is the optimal price and quantity of output?

A. The optimal price is the highest price on the demand curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal \cost curve.

B. The optimal price is the lowest price on the demand curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal \cost curve.

Correct C. The optimal price is the price at which the demand curve intersects the marginal revenue curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal \cost curve.

D. The optimal price is the highest price on the demand curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal revenue curve.

Correct Answer: C

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Question 9

A firm faces a downward-sloping demand curve and has a cons\tant marginal \cost of production. If the firm's marginal revenue is greater than its marginal \cost, what is the optimal price and quantity of output?

A. The optimal price is the highest price on the demand curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal \cost curve.

B. The optimal price is the lowest price on the demand curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal \cost curve.

C. The optimal price is the price at which the demand curve intersects the marginal revenue curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal \cost curve.

Correct D. The optimal price is the highest price on the demand curve, and the optimal quantity is the quantity at which the demand curve intersects the marginal revenue curve.

Correct Answer: D

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Question 10

A country's GDP is calculated as the sum of consumption, investment, government sp\ending, and net exports. If the country's GDP is $100 billion, and the government sp\ending is $20 billion, what is the sum of consumption and investment?

Correct A. $80 billion

B. $60 billion

C. $40 billion

D. $20 billion

Correct Answer: A

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Question 11

A firm is operating on its long-run average \cost curve. If the firm experiences a 20% increase in output, what will be the effect on its average \cost?

A. The average \cost will decrease by 20%

Correct B. The average \cost will increase by 20%

C. The average \cost will remain unchanged

D. The average \cost will decrease by 10%

Correct Answer: B

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Question 12

A central bank is considering a contractionary monetary policy to combat inflation. Which of the following tools would be most effective in achieving this goal?

A. Increa\sing the reserve requirement

Correct B. Increa\sing the discount rate

C. Selling government securities

D. Increa\sing the money supply

Correct Answer: B

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Question 13

A firm is considering a price increase due to an increase in production \costs. If the demand for the firm's product is inelastic, what will be the effect on the firm's revenue?

A. The revenue will decrease

Correct B. The revenue will increase

C. The revenue will remain unchanged

D. The revenue will increase by 10%

Correct Answer: B

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Question 14

A country is experiencing a recession. Which of the following government policies would be most effective in stimulating economic growth?

Correct A. Increa\sing government sp\ending

B. Cutting taxes

C. Increa\sing interest rates

D. Decrea\sing government sp\ending

Correct Answer: A

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Question 15

A firm is considering a new investment project. The project has a net present value (NPV) of ₦100,000 and a required rate of return of 10%. What is the present value of the project's expected cash flows?

Correct A. ₦100,000

B. ₦110,000

C. ₦120,000

D. ₦130,000

Correct Answer: A

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Question 16

A country's GDP grows at a rate of 5% per annum, while its population grows at a rate of 2.5% per annum. If the current GDP is ₦1.2 trillion, what is the GDP 5 years from now?

A. ₦1.8 trillion

Correct B. ₦2.1 trillion

C. ₦1.5 trillion

D. ₦1.0 trillion

Correct Answer: B

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Question 17

A firm's demand function is given by Q = 100 - 2P + 5Y, where Q is the quantity demanded, P is the price, and Y is the income. If the price is ₦20 and the income is ₦50,000, what is the quantity demanded?

A. 50 units

Correct B. 75 units

C. 100 units

D. 125 units

Correct Answer: B

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Question 18

A country's balance of payments is given by the following equation: BOP = X - M, where X is the exports and M is the imports. If the exports are ₦500 billion and the imports are ₦300 billion, what is the balance of payments?

Correct A. ₦200 billion

B. ₦300 billion

C. ₦400 billion

D. ₦500 billion

Correct Answer: A

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Question 19

A firm's \cost function is given by C = 100 + 2Q + 5P, where C is the \cost, Q is the quantity produced, and P is the price. If the quantity produced is 50 units and the price is ₦20, what is the \cost?

A. ₦1,200

B. ₦1,500

Correct C. ₦1,800

D. ₦2,000

Correct Answer: C

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Question 20

A country's opportunity \cost of producing a good is given by the following equation: OC = P / $ 1 - α $, where OC is the opportunity \cost, P is the price, and α is the elasticity of demand. If the price is ₦50 and the elasticity of demand is 0.5, what is the opportunity \cost?

A. ₦100

Correct B. ₦200

C. ₦300

D. ₦400

Correct Answer: B

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Question 21

A firm's revenue function is given by R(x) = 2x^2 + 5x + 1, where x is the number of units produced. If the firm's marginal revenue function is MR(x) = 4x + 5, find the value of x that maximizes revenue.

A. 1

B. 2

Correct C. 3

D. 4

Correct Answer: C

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Question 22

The demand function for a product is given by p = 100 - 2q, where p is the price and q is the quantity demanded. If the supply function is given by p = 2q + 10, find the equilibrium price and quantity.

Correct A. (20, 30)

B. (30, 20)

C. (40, 15)

D. (50, 10)

Correct Answer: A

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Question 23

A country's balance of payments is given by the following equation: BOP = $ X - M $ + $ F - I $, where X is exports, M is imports, F is foreign investment, and I is domestic investment. If the country's exports are $100 billion, imports are $80 billion, foreign investment is $20 billion, and domestic investment is $30 billion, find the balance of payments.

A. $10 billion

Correct B. $20 billion

C. $30 billion

D. $40 billion

Correct Answer: B

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Question 24

A firm's production function is given by Q = 2L^0.5K^0.5, where Q is output, L is labor, and K is capital. If the firm has 100 units of labor and 200 units of capital, find the output.

A. 100

B. 200

Correct C. 300

D. 400

Correct Answer: C

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Question 25

A country's inflation rate is given by the following equation: Inflation = $ M2 - M1 $ / M1, where M2 is the money supply and M1 is the monetary base. If the money supply is $100 billion and the monetary base is $50 billion, find the inflation rate.

A. 0.5

B. 1

Correct C. 1.5

D. 2

Correct Answer: C

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