POST UTME UI 2018 Economics | Objective

Are you preparing for POST UTME UI exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2018 Economics (Objective) questions designed to simulate the real exam environment.

Practice these randomly selected questions to test your readiness.

Question 1
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
Correct B. 2
C. 3
D. 4

Correct Answer: B

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Question 2
A consumer's utility function is given by U(x,y) = 2x + 3y, where x and y are the quantities of two goods consumed. If the consumer's budget constraint is 2x + 3y = 12, find the optimal quantities of x and y that maximize utility.
A. x = 2, y = 4
Correct B. x = 3, y = 3
C. x = 4, y = 2
D. x = 5, y = 1

Correct Answer: B

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Question 3
A firm's \cost function is given by C(x) = 2x^2 + 5x + 1, where x is the number of units produced. If the firm's revenue function is R(x) = 4x^2 + 5x + 1, find the break-even point.
A. x = 1
Correct B. x = 2
C. x = 3
D. x = 4

Correct Answer: B

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Question 4
A consumer's budget constraint is given by 2x + 3y = 12, where x and y are the quantities of two goods consumed. If the consumer's utility function is U(x,y) = 2x + 3y, find the optimal quantities of x and y that maximize utility.
A. x = 2, y = 4
Correct B. x = 3, y = 3
C. x = 4, y = 2
D. x = 5, y = 1

Correct Answer: B

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Question 5
A firm's demand function is given by D(p) = 100 - 2p, where p is the price of the good. If the firm's \cost function is C(x) = 2x^2 + 5x + 1, find the price that maximizes profit.
A. p = 20
Correct B. p = 30
C. p = 40
D. p = 50

Correct Answer: B

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Question 6
The Marshall-Lerner condition states that a country will benefit from a devaluation of its currency if the sum of the price elasticities of demand for imports and exports is greater than 1. What is the implication of this condition on the balance of payments?
Correct A. The balance of payments will improve.
B. The balance of payments will worsen.
C. The balance of payments will remain unchanged.
D. The Marshall-Lerner condition is irrelevant to the balance of payments.

Correct Answer: A

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Question 7
Agricultural development in Nigeria has been hindered by the lack of access to credit by small-scale farmers. What is the likely effect of a government policy to provide credit to these farmers?
Correct A. The supply of agricultural products will increase.
B. The demand for agricultural products will increase.
C. The price of agricultural products will decrease.
D. The supply of agricultural products will decrease.

Correct Answer: A

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Question 8
The National Bureau of Statistics (NBS) reports that the GDP of Nigeria has increased by 3% in the past year. What is the implication of this growth rate on the s\tandard of living of the average Nigerian?
A. The s\tandard of living will increase.
Correct B. The s\tandard of living will remain unchanged.
C. The s\tandard of living will decrease.
D. The s\tandard of living will be unaffected.

Correct Answer: B

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Question 9
A firm is considering the introduction of a new product. The demand for the product is given by the equation Q = 100 - 2P, where Q is the quantity demanded and P is the price. What is the price elasticity of demand for the product?
A. 0.5
B. 1
C. 2
Correct D. -1

Correct Answer: D

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Question 10
The Central Bank of Nigeria (CBN) has increased the reserve requirement for commercial banks from 10% to 15%. What is the likely effect of this policy on the money supply?
A. The money supply will increase.
Correct B. The money supply will decrease.
C. The money supply will remain unchanged.
D. The money supply will be unaffected.

Correct Answer: B

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Question 11
The Central Bank of Nigeria (CBN) uses the monetary policy instrument of Open Market Operations (OMO) to increase the money supply in the economy. If the CBN buys government securities worth ₦1 billion from commercial banks, what is the likely effect on the money supply?
A. The money supply decreases
Correct B. The money supply increases
C. The money supply remains unchanged
D. The money supply decreases in the short run but increases in the long run

Correct Answer: B

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Question 12
A firm is considering the production of two goods, X and Y, with the following \cost functions: C_X = 2X^2 + 3X + 10 and C_Y = X^2 + 2Y^2 + 5. If the firm produces 10 units of good X and 5 units of good Y, what is the total \cost of production?
A. ₦150
B. ₦200
C. ₦250
Correct D. ₦300

Correct Answer: D

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Question 13
The government of Nigeria is considering a tax reform to increase revenue. If the government imposes a tax rate of 20% on all goods and services, and the average price of goods and services is ₦100, what is the expected increase in revenue?
A. ₦10 million
Correct B. ₦20 million
C. ₦30 million
D. ₦40 million

Correct Answer: B

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Question 14
A firm is considering the production of a new product. The 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 increases labor by 20% and capital by 15%, what is the expected increase in output?
A. 10%
B. 15%
Correct C. 20%
D. 25%

Correct Answer: C

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Question 15
The government of Nigeria is considering a fiscal policy to reduce inflation. If the government reduces government exp\enditure by 10% and increases taxes by 5%, what is the expected effect on the aggregate demand?
A. The aggregate demand increases
Correct B. The aggregate demand decreases
C. The aggregate demand remains unchanged
D. The aggregate demand decreases in the short run but increases in the long run

Correct Answer: B

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Question 16
A firm's production function is given by Q = 2L^\( 1/2 \)K^\( 1/2 \), where L is labor and K is capital. If the firm's current labor and capital inputs are 16 and 9 respectively, what is the marginal product of labor?
Correct A. 4L^\( -1/2 \)K^\( 1/2 \)
B. 2L^\( -1/2 \)K^\( -1/2 \)
C. 8L^\( -1/2 \)K^\( -1/2 \)
D. 6L^\( -1/2 \)K^\( -1/2 \)

Correct Answer: A

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Question 17
A consumer's utility function is given by U = 2x + 3y, where x and y are the quantities of two goods. If the consumer's budget constraint is 10x + 5y = 50, what is the consumer's optimal bundle of goods?
Correct A. (5, 5)
B. (10, 0)
C. (0, 10)
D. (7.5, 2.5)

Correct Answer: A

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Question 18
A firm's \cost function is given by C = 2L + 3K, where L is labor and K is capital. If the firm's current labor and capital inputs are 10 and 5 respectively, what is the firm's total \cost?
A. 25
Correct B. 30
C. 35
D. 40

Correct Answer: B

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Question 19
A market structure is characterized by a \single firm producing a homogeneous product, and the firm has complete control over the market price. What is the market structure?
A. Perfect Competition
Correct B. Monopoly
C. Monopolistic Competition
D. Oligopoly

Correct Answer: B

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Question 20
A firm's revenue function is given by R = 2x^2 + 3x, where x is the quantity of the good sold. If the firm sells 5 units of the good, what is the firm's total revenue?
A. 25
Correct B. 30
C. 35
D. 40

Correct Answer: B

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Question 21
Suppose the government of a country imposes a tax on a firm's output. If the firm's supply curve shifts to the left, what will happen to the equilibrium price and quantity in the market?
Correct A. The equilibrium price will increase and the equilibrium quantity will decrease.
B. The equilibrium price will decrease and the equilibrium quantity will increase.
C. The equilibrium price will remain the same and the equilibrium quantity will decrease.
D. The equilibrium price will decrease and the equilibrium quantity will decrease.

Correct Answer: A

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Question 22
A monopolistically competitive firm faces a downward-sloping demand curve. If the firm's average total \cost curve is U-shaped, what will happen to the firm's profit-maximizing output?
A. The firm will produce at the minimum point of the average total \cost curve.
Correct B. The firm will produce at the point where the marginal revenue curve intersects the marginal \cost curve.
C. The firm will produce at the maximum point of the average total \cost curve.
D. The firm will produce at the point where the demand curve intersects the average total \cost curve.

Correct Answer: B

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Question 23
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 its consumption is ₦60 billion, what is the value of its net exports?
A. ₦20 billion
B. ₦30 billion
C. ₦40 billion
Correct D. ₦50 billion

Correct Answer: D

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Question 24
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's labor and capital inputs are 4 and 9 respectively, what is the value of its output?
A. 16
B. 32
Correct C. 64
D. 128

Correct Answer: C

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Question 25
A consumer's budget constraint is given by P1Q1 + P2Q2 = I. If the consumer's income is ₦100 and the prices of the two goods are ₦10 and ₦20 respectively, what is the value of the consumer's optimal bundle?
A. Q1 = 2, Q2 = 3
Correct B. Q1 = 3, Q2 = 2
C. Q1 = 4, Q2 = 1
D. Q1 = 1, Q2 = 4

Correct Answer: B

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