POST UTME SKYLINE UNIVERSITY 2023 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A firm's production function is given by Q = 2L^\( 1/2 \)K^\( 1/2 \). If the price of labor is $10 per unit and the price of capital is $20 per unit, and the firm's budget constraint is 10L + 20K = 100, what is the optimal level of labor and capital?
A. L = 5, K = 2
B. L = 10, K = 5
C. L = 20, K = 10
D. L = 5, K = 10
Question 2
A firm's production function is given by Q = 2L^\( 1/2 \)K^\( 1/2 \). If the price of labor is $10 per unit and the price of capital is $20 per unit, and the firm's budget constraint is 10L + 20K = 100, what is the optimal level of labor and capital?
A. L = 5, K = 2
B. L = 10, K = 5
C. L = 20, K = 10
D. L = 5, K = 10
Question 3
A consumer's budget constraint is given by 2x + 3y = 12. If the consumer's indifference curves are given by IC1: 2x + 3y = 6, IC2: 2x + 3y = 12, what is the consumer's optimal consumption bundle?
A. (3, 0)
B. (2, 1)
C. (1, 2)
D. (0, 3)
Question 4
Consider a firm operating in a perfectly competitive market. If the firm's marginal revenue (MR) curve intersects its marginal \cost (MC) curve at point E, where MR = MC, and the price elasticity of demand (PED) is 2, what is the expected change in quantity demanded (ΔQ) if the price (P) increases by 10%?
A. -20%
B. -15%
C. -10%
D. -5%
Question 5
A diagram shows a firm's average \cost curve and marginal \cost curve. If the firm's output is 20 units, what is the likely outcome?
A. Price increases and quantity decreases
B. Price decreases and quantity increases
C. Price remains the same and quantity increases
D. Price increases and quantity increases
Question 6
A firm is producing a product u\sing a production function given by Q = 3L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the firm is currently producing 100 units of output with 4 units of labor and 9 units of capital, find the returns to scale.
A. Increa\sing
B. Decrea\sing
C. Cons\tant
D. Mixed
Question 7
A government imposes a tax on a firm's output. If the firm's supply curve shifts to the left by 20% due to the tax, and the price elasticity of supply (PES) is 3, what is the expected change in quantity supplied (ΔQ) if the price (P) increases by 15%?
A. -30%
B. -25%
C. -20%
D. -15%
Question 8
A monopolist faces a demand curve given by Qd = 100 - 2P and a \cost function given by C(Q) = 2Q^2 + 10Q. Find the profit-maximizing quantity and price.
A. ₦200
B. ₦250
C. ₦300
D. ₦350
Question 9
A firm's production function is given by Q = 2L^0.5H^0.5, where Q is output, L is labor, and H is capital. If the firm's current labor and capital inputs are L = 4 and H = 9, respectively, what is the firm's output?
A. 6
B. 8
C. 10
D. 12
Question 10
A consumer's budget constraint is given by 2x + 3y = 12. If the consumer's indifference curves are given by IC1: 2x + 3y = 6, IC2: 2x + 3y = 12, what is the consumer's optimal consumption bundle?
A. (3, 0)
B. (2, 1)
C. (1, 2)
D. (0, 3)
Question 11
The concept of consumer behavior in economics implies that consumers make rational decisions based on their preferences and budget constraints. Which of the following is a correct statement about consumer behavior?
A. Consumers make irrational decisions based on their preferences and budget constraints.
B. Consumers make rational decisions based on their preferences and budget constraints.
C. Consumers make decisions based on their income and wealth.
D. Consumers make decisions based on their age and occupation.
Question 12
The concept of scarcity in economics implies that the production of one good is limited by the availability of resources, which can be allocated to other goods. Which of the following is a correct statement about the opportunity \cost of producing one good?
A. The opportunity \cost is the value of the next best alternative good that could have been produced with the same resources.
B. The opportunity \cost is the value of the good that is given up when producing another good.
C. The opportunity \cost is the value of the good that is produced in excess of the demand.
D. The opportunity \cost is the value of the good that is not produced at all.
Question 13
A firm is considering investing in a new project with an initial \cost of ₦100,000 and expected returns of ₦120,000 per year. If the firm's discount rate is 10%, what is the net present value of the project?
A. ₦20,000
B. ₦30,000
C. ₦40,000
D. ₦50,000
Question 14
A central bank increases the money supply by 10%. If the initial money supply is ₦1 trillion, what is the new money supply?
A. ₦1.1 trillion
B. ₦1.2 trillion
C. ₦1.3 trillion
D. ₦1.4 trillion
Question 15
A country's national income is calculated as the sum of wages (W), rent (R), interest (I), and profits (P). If the country's national income is ₦15 trillion, and the wages (W) is ₦8 trillion, what is the value of the profits (P) if the rent (R) is ₦2 trillion and the interest (I) is ₦1.5 trillion?
A. ₦2.5 trillion
B. ₦3 trillion
C. ₦3.5 trillion
D. ₦4 trillion

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