POST UTME NOUN 2022 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A country's GDP is given by GDP = C + I + G + \( X - M \), where C is consumption, I is investment, G is government sp\ending, X is exports and M is imports. If the country's GDP is $100 billion, consumption is $50 billion, investment is $20 billion, government sp\ending is $15 billion, exports are $30 billion and imports are $25 billion, what is the country's trade balance?
A. $5 billion surplus
B. $10 billion deficit
C. $15 billion surplus
D. $20 billion deficit
Question 2
A firm's production function is given by Q = 2L^0.5K^0.5, where Q is the output, L is the labor and K is the capital. If the firm wants to produce 16 units of output, and it has 4 units of labor, how many units of capital does it need to produce the desired output?
A. 4
B. 8
C. 16
D. 32
Question 3
The Marshall-Lerner condition states that if the sum of the elasticities of demand for exports and imports is greater than 1, then a devaluation of the currency will lead to an improvement in the balance of payments. Which of the following is a correct statement regarding the Marshall-Lerner condition?
A. A devaluation of the currency will lead to a decrease in the trade deficit.
B. A devaluation of the currency will lead to an increase in the trade surplus.
C. The Marshall-Lerner condition is only applicable to small open economies.
D. The Marshall-Lerner condition is only applicable to large open economies.
Question 4
A firm is producing a good with a marginal revenue function of MR = 100 - 2Q and a marginal \cost function of MC = 50 + Q. What is the profit-maximizing quantity of the good?
A. 25
B. 30
C. 35
D. 40
Question 5
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 price elasticity of demand is 0.5, what is the price elasticity of supply?
A. 0.5
B. 1.0
C. 2.0
D. 3.0
Question 6
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's labor and capital inputs are increased by 20% and 15% respectively, what is the percentage change in output?
A. 10%
B. 12%
C. 15%
D. 18%
Question 7
A firm's \cost function is given by C = 2L + 3K, where C is the \cost, L is the labor and K is the capital. If the firm wants to minimize its \cost, and it has 4 units of labor, how many units of capital does it need to produce the desired output?
A. 4
B. 8
C. 16
D. 32
Question 8
A central bank is considering a monetary policy to reduce inflation. If the current inflation rate is 5% and the central bank wants to reduce it to 3% within a year, what is the required rate of interest?
A. 5%
B. 6%
C. 7%
D. 8%
Question 9
A firm's production function is given by Q = 3L^0.5K^0.5. If the firm's current input prices are w = 15 and r = 30, and it currently uses L = 6 and K = 12, calculate the firm's current total \cost.
A. ₦2,160
B. ₦2,520
C. ₦2,880
D. ₦3,240
Question 10
A firm is considering investing in a new project that has a high expected return, but also a high level of risk. What is the opportunity \cost of investing in this project?
A. The opportunity \cost is the value of the next best alternative foregone.
B. The opportunity \cost is the value of the next best alternative foregone, in terms of the expected return.
C. The opportunity \cost is the value of the next best alternative foregone, in terms of the risk.
D. The opportunity \cost is the value of the next best alternative foregone, in terms of the expected return and the risk.
Question 11
A firm is producing a good with a total revenue of ₦100,000 and a total \cost of ₦80,000. If the price elasticity of demand is 0.5, what is the price elasticity of supply?
A. 0.5
B. 1.0
C. 2.0
D. 3.0
Question 12
A consumer's utility function is given by U = 2x + 3y, where x and y are the quantities of two goods consumed. If the prices of the two goods are $2 and $3 respectively, and the consumer's income is $100, what is the optimal bundle of goods that maximizes utility?
A. x = 20, y = 10
B. x = 15, y = 15
C. x = 10, y = 20
D. x = 25, y = 5
Question 13
A firm is producing a good with a cons\tant elasticity of demand of 2. If the price of the good increases by 10%, what is the percentage change in quantity demanded?
A. -20%
B. -10%
C. 0%
D. 10%
Question 14
A firm has a total revenue (TR) of ₦1,000,000 and a total \cost (TC) of ₦800,000. What is its profit?
A. ₦100,000
B. ₦200,000
C. ₦300,000
D. ₦400,000
Question 15
The government of Nigeria has implemented a policy to increase agricultural production and reduce dep\endence on imported food. What is the likely effect of this policy on the agricultural sector?
A. The policy will lead to an increase in agricultural production and a decrease in food imports.
B. The policy will lead to a decrease in agricultural production and an increase in food imports.
C. The policy will have no effect on agricultural production and food imports.
D. The policy will lead to an increase in agricultural production, but an increase in food imports.

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