Practice post utme uniosun economics 2022 Past Questions

Question 1

Determine the returns to scale of a firm with a production function Q = 2x^2y^3, where Q is output and x and y are inputs.

A. Increa\sing Returns to Scale

B. Decrea\sing Returns to Scale

Correct C. Cons\tant Returns to Scale

D. No Returns to Scale

Correct Answer: C

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Question 2

A firm faces a demand curve given by Q = 100 - 2P, where Q is quantity demanded and P is price. If the firm's marginal revenue (MR) is given by MR = 200 - 4P, what is the price elasticity of demand?

A. 0.5

B. 1

C. 2

Correct D. -1

Correct Answer: D

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Question 3

A central bank uses a monetary policy tool to increase the money supply by 10%. If the initial money supply is ₦100 billion, what is the new money supply?

A. ₦110 billion

Correct B. ₦110.1 billion

C. ₦110.5 billion

D. ₦110.9 billion

Correct Answer: B

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Question 4

A firm's production function is given by Q = 3x^2y^2, where Q is output and x and y are inputs. If the firm's output increases by 20% due to an increase in input x, what is the percentage increase in input y?

A. 10%

B. 15%

Correct C. 20%

D. 25%

Correct Answer: C

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Question 5

A government imposes a tax on a firm's output, cau\sing the firm's supply curve to shift to the left. If the firm's initial supply curve is given by Q = 100 - 2P and the tax causes the supply curve to shift to Q = 80 - 2P, what is the deadweight loss?

A. ₦20

B. ₦40

Correct C. ₦60

D. ₦80

Correct Answer: C

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Question 6

A firm is operating in a perfectly competitive market with a cons\tant returns to scale production function. If the market price of its product increases by 10%, what will be the percentage change in its total revenue?

A. 10%

B. 20%

C. 5%

Correct D. 0%

Correct Answer: D

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Question 7

A government is planning to implement a new economic policy to reduce poverty and inequality. The policy involves increa\sing the minimum wage, providing subsidies to small bu\sinesses, and investing in education and healthcare. Which of the following is a potential consequence of this policy?

A. Increased unemployment

Correct B. Reduced poverty and inequality

C. Increased inflation

D. Decreased economic growth

Correct Answer: B

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Question 8

A monopolistically competitive firm faces a demand curve with the following equation: Q = 100 - 2P. If the firm's marginal \cost is cons\tant at 20, what is the optimal price it should charge for its product?

A. ₦40

Correct B. ₦30

C. ₦20

D. ₦10

Correct Answer: B

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Question 9

A consumer has a budget of ₦1000 and faces the following prices for two goods: Good X \costs ₦200 and Good Y \costs ₦300. If the consumer's indifference curve is \tangent to the budget line, what is the optimal combination of the two goods?

Correct A. Good X: 2 units, Good Y: 1 unit

B. Good X: 1 unit, Good Y: 2 units

C. Good X: 3 units, Good Y: 0 units

D. Good X: 0 units, Good Y: 3 units

Correct Answer: A

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Question 10

A firm is producing a good with a production function Q = 2L^0.5K^0.5. 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. 20%

C. 15%

Correct D. 0%

Correct Answer: D

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Question 11

The production function is given by Q = 2L^0.5K^0.5. If the price of labor is ₦100 per unit and the price of capital is ₦200 per unit, and the firm's budget constraint is 100L + 200K = 10000, find the optimal values of L and K.

A. L = 100, K = 50

Correct B. L = 50, K = 100

C. L = 200, K = 50

D. L = 50, K = 200

Correct Answer: B

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Question 12

A firm is producing a good u\sing labor and capital. The production function is given by Q = 2L^0.5K^0.5. If the price of labor is ₦100 per unit and the price of capital is ₦200 per unit, and the firm's budget constraint is 100L + 200K = 10000, find the optimal values of L and K.

A. L = 100, K = 50

Correct B. L = 50, K = 100

C. L = 200, K = 50

D. L = 50, K = 200

Correct Answer: B

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Question 13

The government of a country is considering a new tax policy. The tax rate is 20% of the income, and the income is ₦100,000. If the government wants to collect ₦20,000 in tax revenue, what is the optimal tax rate?

A. 10%

Correct B. 20%

C. 30%

D. 40%

Correct Answer: B

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Question 14

A firm is producing a good u\sing labor and capital. The production function is given by Q = 2L^0.5K^0.5. If the price of labor is ₦100 per unit and the price of capital is ₦200 per unit, and the firm's budget constraint is 100L + 200K = 10000, find the optimal values of L and K.

A. L = 100, K = 50

Correct B. L = 50, K = 100

C. L = 200, K = 50

D. L = 50, K = 200

Correct Answer: B

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Question 15

The government of a country is considering a new tax policy. The tax rate is 20% of the income, and the income is ₦100,000. If the government wants to collect ₦20,000 in tax revenue, what is the optimal tax rate?

A. 10%

Correct B. 20%

C. 30%

D. 40%

Correct Answer: B

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Question 16

Consider a country that imports 100 units of a commodity at a price of ₦500 per unit. If the country also exports 80 units of another commodity at a price of ₦300 per unit, what is the balance of trade?

A. ₦20,000

Correct B. ₦40,000

C. ₦60,000

D. ₦80,000

Correct Answer: B

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Question 17

A consumer has a budget of ₦1,000 and faces the following prices for two goods: Good A \costs ₦200 per unit and Good B \costs ₦300 per unit. If the consumer buys 5 units of Good A, how many units of Good B can the consumer buy?

A. 2 units

Correct B. 3 units

C. 4 units

D. 5 units

Correct Answer: B

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Question 18

A firm produces two goods, A and B. The production of Good A requires 2 units of labor and 1 unit of capital, while the production of Good B requires 1 unit of labor and 2 units of capital. If the firm has 10 units of labor and 8 units of capital, what is the opportunity \cost of producing 5 units of Good A?

A. 2 units of Good B

B. 3 units of Good B

Correct C. 4 units of Good B

D. 5 units of Good B

Correct Answer: C

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Question 19

A country's GDP at market price is ₦1,500 billion, while its GDP at factor \cost is ₦1,400 billion. What is the net indirect tax?

A. ₦50 billion

B. ₦100 billion

Correct C. ₦150 billion

D. ₦200 billion

Correct Answer: C

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Question 20

A firm faces the following demand and supply schedules for a commodity:\n\n| Price | Quantity Demanded | Quantity Supplied |\n| --- | --- | --- |\n| ₦100 | 100 units | 0 units |\n| ₦120 | 80 units | 20 units |\n| ₦150 | 60 units | 40 units |\n| ₦180 | 40 units | 60 units |\n| ₦200 | 20 units | 80 units |\n| ₦250 | 0 units | 100 units |\n\nWhat is the equilibrium price and quantity?

A. ₦120, 80 units

Correct B. ₦150, 60 units

C. ₦180, 40 units

D. ₦200, 20 units

Correct Answer: B

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Question 21

A firm operating in a perfectly competitive market is considering an increase in production. If the firm's average \cost curve shifts to the right, what will happen to its profit-maximizing output level?

A. The firm will increase its profit-maximizing output level.

B. The firm will decrease its profit-maximizing output level.

Correct C. The firm's profit-maximizing output level will remain unchanged.

D. The firm will shut down immediately.

Correct Answer: C

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Question 22

A consumer's indifference curve is given by the equation ( u(x,y) = 2x + 3y ). If the consumer's income is ₦1000 and the prices of x and y are ₦5 and ₦10 respectively, what is the consumer's optimal bundle?

Correct A. x = 40, y = 20

B. x = 30, y = 30

C. x = 20, y = 40

D. x = 10, y = 50

Correct Answer: A

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Question 23

A monopolist faces a demand curve given by \( Q = 100 - 2P \). If the firm's marginal \cost is ₦20, what is the profit-maximizing price?

A. ₦40

Correct B. ₦30

C. ₦20

D. ₦10

Correct Answer: B

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Question 24

A firm's production function is given by \( Q = 2L^2 + 3K^2 \). If the firm's input prices are ₦10 per unit of labor and ₦20 per unit of capital, what is the \cost-minimizing input bundle?

A. L = 10, K = 5

Correct B. L = 5, K = 10

C. L = 15, K = 15

D. L = 20, K = 20

Correct Answer: B

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Question 25

A government is considering a tax on a firm's output. If the firm's supply curve is given by \( Q = 100 - 2P \) and the tax rate is ₦5 per unit of output, what is the new supply curve?

Correct A. \( Q = 95 - 2P \)

B. \( Q = 105 - 2P \)

C. \( Q = 90 - 2P \)

D. \( Q = 110 - 2P \)

Correct Answer: A

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POST UTME UNIOSUN 2022 Economics | Objective

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