POST UTME UI 2019 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 2019 Economics (Objective) questions designed to simulate the real exam environment.

Practice these randomly selected questions to test your readiness.

Question 1
Consider a firm operating in a perfectly competitive market with a production function Q = 2L^0.5K^0.5. If the firm's current input prices are w = ₦100 and r = ₦200, and it is currently producing 100 units of output, what is the firm's current economic profit?
A. ₦5,000
Correct B. ₦10,000
C. ₦20,000
D. ₦50,000

Correct Answer: B

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Question 2
A country's balance of payments account is in equilibrium when the current account is equal to the capital account. If the country's current account is in deficit by ₦100 billion and the capital account is in surplus by ₦50 billion, what is the net effect on the country's balance of payments?
A. ₦50 billion surplus
B. ₦50 billion deficit
C. ₦100 billion surplus
Correct D. ₦100 billion deficit

Correct Answer: D

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Question 3
A firm is considering two different production techno\logies: a traditional techno\logy with a production function Q = 2L^0.5K^0.5 and a modern techno\logy with a production function Q = 3L^0.7K^0.3. If the firm's current input prices are w = ₦100 and r = ₦200, and it is currently producing 100 units of output, which techno\logy should the firm adopt to maximize its economic profit?
A. Traditional techno\logy
Correct B. Modern techno\logy
C. Either techno\logy is equally profitable
D. Neither techno\logy is profitable

Correct Answer: B

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Question 4
Consider a country with a fixed exchange rate of ₦100 per dollar. If the country's inflation rate is 10% and the foreign inflation rate is 5%, what is the expected change in the country's real exchange rate?
Correct A. ₦5 depreciation
B. ₦10 appreciation
C. ₦10 depreciation
D. ₦5 appreciation

Correct Answer: A

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Question 5
A firm is considering two different investment projects: Project A with a 10% probability of success and a 20% return on investment, and Project B with a 20% probability of success and a 10% return on investment. Which project should the firm adopt to maximize its expected return on investment?
Correct A. Project A
B. Project B
C. Either project is equally profitable
D. Neither project is profitable

Correct Answer: A

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Question 6
A monopolist faces a demand curve given by Q = 100 - 2P and a \cost function C(Q) = 10Q + 100. If the monopolist produces 20 units, what is the profit-maximizing price?
A. ₦50
B. ₦60
Correct C. ₦70
D. ₦80

Correct Answer: C

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Question 7
A firm has a production function F(L, K) = 2L^0.5K^0.5. If the firm has 4 units of labor and 9 units of capital, what is the marginal product of labor?
A. 1.5
Correct B. 2.5
C. 3.5
D. 4.5

Correct Answer: B

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Question 8
A consumer has an indifference curve given by U(x, y) = 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?
Correct A. x = 10, y = 5
B. x = 15, y = 3
C. x = 20, y = 2
D. x = 25, y = 1

Correct Answer: A

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Question 9
A government imposes a tax of ₦10 on a good that is currently priced at ₦20. If the demand for the good is given by Q = 100 - 2P, what is the new equilibrium price?
A. ₦15
B. ₦20
Correct C. ₦25
D. ₦30

Correct Answer: C

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Question 10
A firm has a production function F(L, K) = 2L^0.5K^0.5. If the firm has 4 units of labor and 9 units of capital, what is the total product?
A. 16
B. 20
Correct C. 24
D. 28

Correct Answer: C

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Question 11
The production function for a firm is given by Q = 2L^0.5K^0.5, where Q is output, L is labor, and K is capital. If the firm increases labor from 4 units to 9 units, and capital from 9 units to 16 units, what is the percentage change in output?
A. 10%
B. 20%
Correct C. 30%
D. 40%

Correct Answer: C

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Question 12
A consumer has the following utility function: U = 2x + 3y, where x and y are the quantities of two goods. If the prices of the goods are $2 and $3 respectively, and the consumer has a budget of $10, what is the optimal quantity of good x?
A. 2 units
Correct B. 3 units
C. 4 units
D. 5 units

Correct Answer: B

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Question 13
A firm is operating in a perfectly competitive market. If the market price of its product is $10, and the firm's marginal \cost is $8, what is the firm's profit-maximizing quantity?
A. 100 units
Correct B. 200 units
C. 300 units
D. 400 units

Correct Answer: B

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Question 14
A consumer has the following indifference curve: U = 2x + 3y, where x and y are the quantities of two goods. If the prices of the goods are $2 and $3 respectively, and the consumer has a budget of $10, what is the optimal quantity of good x?
A. 2 units
Correct B. 3 units
C. 4 units
D. 5 units

Correct Answer: B

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Question 15
A firm is operating in a monopoly market. If the market demand curve is given by Q = 100 - 2P, and the firm's marginal \cost is $8, what is the firm's profit-maximizing price?
A. $20
Correct B. $30
C. $40
D. $50

Correct Answer: B

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Question 16
The demand for a product is given by the equation Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. The supply of the product is given by the equation Qs = 2P - 100, where Qs is the quantity supplied. Find the equilibrium price and quantity.
A. ₦50, 200 units
B. ₦75, 150 units
Correct C. ₦100, 100 units
D. ₦125, 50 units

Correct Answer: C

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Question 17
A country's GDP is ₦1,000,000,000,000. Its GNP is ₦1,100,000,000,000. What is the net factor income from abroad?
A. ₦100,000,000,000
Correct B. ₦200,000,000,000
C. ₦300,000,000,000
D. ₦400,000,000,000

Correct Answer: B

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Question 18
A government imposes a tax of ₦10 on every unit of a product. The demand for the product is given by the equation Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. The supply of the product is given by the equation Qs = 2P - 100, where Qs is the quantity supplied. Find the new equilibrium price and quantity.
Correct A. ₦60, 180 units
B. ₦80, 140 units
C. ₦100, 100 units
D. ₦120, 60 units

Correct Answer: A

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Question 19
A country's balance of payments is given by the equation BOP = X - M, where X is the value of exports and M is the value of imports. If the value of exports is ₦500,000,000,000 and the value of imports is ₦600,000,000,000, what is the balance of payments?
Correct A. ₦-100,000,000,000
B. ₦0
C. ₦100,000,000,000
D. ₦200,000,000,000

Correct Answer: A

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Question 20
A consumer has a budget of ₦1,000,000 and a preference for two goods, A and B. The prices of the goods are ₦500,000 and ₦300,000, respectively. If the consumer sp\ends all of their budget, how much of good A will they buy?
A. 2 units
Correct B. 3 units
C. 4 units
D. 5 units

Correct Answer: B

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Question 21
Consider a country with a population of 10 million people, where 40% of the population lives below the poverty line. The government has implemented a program to reduce poverty by 20% in the next 5 years. Assuming the poverty rate decreases linearly, calculate the number of people who will be lifted out of poverty in the next 5 years.
A. 2 million
B. 3 million
Correct C. 4 million
D. 5 million

Correct Answer: C

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Question 22
A firm produces two goods, A and B, u\sing two inputs, labor and capital. The production function for good A is given by Q_A = 2L^0.5K^0.5, where Q_A is the quantity of good A produced, L is the amount of labor used, and K is the amount of capital used. The production function for good B is given by Q_B = 3L^0.7K^0.3. If the firm has 100 units of labor and 50 units of capital, how many units of good A and good B should the firm produce?
A. Q_A = 10, Q_B = 20
B. Q_A = 20, Q_B = 10
Correct C. Q_A = 15, Q_B = 25
D. Q_A = 25, Q_B = 15

Correct Answer: C

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Question 23
A consumer has a budget of ₦1000 to sp\end on two goods, X and Y. The price of good X is ₦200 and the price of good Y is ₦300. The consumer's indifference curves are given by the equation U = 2X^0.5Y^0.5, where U is the level of utility. If the consumer is currently consuming 2 units of good X and 1 unit of good Y, what is the maximum amount of good Y the consumer can buy?
A. 3 units
B. 4 units
Correct C. 5 units
D. 6 units

Correct Answer: C

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Question 24
A firm is considering two different production techno\logies to produce a good. The first techno\logy has a fixed \cost of ₦1000 and a variable \cost of ₦200 per unit produced. The second techno\logy has a fixed \cost of ₦500 and a variable \cost of ₦300 per unit produced. If the firm expects to produce 10 units of the good, which techno\logy should the firm choose?
Correct A. First techno\logy
B. Second techno\logy
C. Both techno\logies are equally profitable
D. Neither techno\logy is profitable

Correct Answer: A

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Question 25
A consumer has a budget of ₦500 to sp\end on two goods, X and Y. The price of good X is ₦100 and the price of good Y is ₦200. The consumer's indifference curves are given by the equation U = 2X^0.5Y^0.5, where U is the level of utility. If the consumer is currently consuming 2 units of good X and 1 unit of good Y, what is the maximum amount of good Y the consumer can buy?
A. 2 units
B. 3 units
Correct C. 4 units
D. 5 units

Correct Answer: C

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