Practice post utme uniport economics 2019 Past Questions

Question 1

A firm's total revenue (TR) is given by the equation TR = 10q + 20q^2, where q is the quantity sold. If the firm's marginal revenue (MR) is 30q + 40q^2, find the value of q when MR = 0.

A. 5

Correct B. 10

C. 15

D. 20

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 2

The following diagram shows the production possibilities frontier (PPF) for a country.

Correct A. Opportunity \cost of producing more of good X is the amount of good Y that must be given up.

B. The PPF shows the maximum possible output of good X that can be produced given the available resources.

C. The slope of the PPF represents the opportunity \cost of producing more of good X.

D. The PPF is a straight line because the opportunity \cost of producing more of good X is cons\tant.

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 3

A consumer's utility function is given by U = 2x + 3y, where x and y are the quantities of two goods consumed. If the consumer's budget constraint is 10x + 20y = 100, find the optimal values of x and y.

Correct A. x = 5, y = 2

B. x = 10, y = 5

C. x = 15, y = 10

D. x = 20, y = 15

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 4

The following table shows the national income accounts for a country.

A. GDP = 1000

Correct B. GDP = 1200

C. GDP = 1500

D. GDP = 1800

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 5

A firm's \cost function is given by C = 10q + 20q^2, where q is the quantity produced. If the firm's revenue function is R = 15q + 30q^2, find the profit-maximizing value of q.

A. q = 5

Correct B. q = 10

C. q = 15

D. q = 20

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 6

Consider a firm operating in a perfectly competitive market with a given production function Q = 2L^0.5K^0.5. If the firm's current input prices are w = ₦100 and r = ₦200, and the current output price is p = ₦500, calculate the firm's optimal input bundle (L, K) u\sing the Hotelling's Lemma. Assume that the firm's objective is to maximize its profit.

Correct A. \( L = 100, K = 100 \)

B. \( L = 50, K = 50 \)

C. \( L = 200, K = 200 \)

D. \( L = 150, K = 150 \)

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 7

A government is considering implementing a new tax on a specific good. The tax will be levied on the producers of the good, and the revenue generated from the tax will be used to fund a public program. If the pre-tax price of the good is ₦100, and the tax rate is 20%, calculate the new price of the good after the tax is implemented.

A. ₦80

Correct B. ₦120

C. ₦100

D. ₦140

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 8

A firm is considering investing in a new project. The project has a fixed \cost of ₦100,000 and a variable \cost of ₦50 per unit produced. If the firm expects to sell 1,000 units of the product at ₦200 per unit, calculate the firm's profit u\sing the break-even analysis.

Correct A. ₦150,000

B. ₦200,000

C. ₦250,000

D. ₦300,000

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 9

A government is considering implementing a new policy to promote agricultural production in a specific region. The policy includes providing subsidies to farmers for the purchase of inputs such as seeds and fertilizers. If the government allocates ₦100 million for the subsidies, and the subsidy rate is 20% of the total \cost of inputs, calculate the total \cost of inputs that the farmers will bear.

A. ₦400 million

Correct B. ₦500 million

C. ₦600 million

D. ₦700 million

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 10

A firm is operating in a perfectly competitive market with a given production function Q = 2L^0.5K^0.5. If the firm's current input prices are w = ₦100 and r = ₦200, and the current output price is p = ₦500, calculate the firm's optimal input bundle (L, K) u\sing the Hotelling's Lemma. Assume that the firm's objective is to maximize its profit.

Correct A. \( L = 100, K = 100 \)

B. \( L = 50, K = 50 \)

C. \( L = 200, K = 200 \)

D. \( L = 150, K = 150 \)

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 11

The government of a country decides to implement a policy of reducing the budget deficit by increa\sing taxes. However, this policy has an unint\ended consequence of reducing the overall demand for goods and services in the economy. What is the likely effect of this policy on the country's GDP?

A. The GDP will increase due to the increase in tax revenue.

Correct B. The GDP will decrease due to the reduction in demand for goods and services.

C. The GDP will remain unchanged as the increase in tax revenue is offset by the reduction in demand.

D. The GDP will increase due to the increase in government sp\ending.

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 12

A firm is considering two different production processes for its product. Process A has a fixed \cost of ₦100,000 and a variable \cost of ₦50 per unit. Process B has a fixed \cost of ₦150,000 and a variable \cost of ₦30 per unit. If the firm produces 10,000 units of the product, what is the total \cost of production for each process?

Correct A. Process A: ₦1,500,000, Process B: ₦1,200,000

B. Process A: ₦1,200,000, Process B: ₦1,500,000

C. Process A: ₦1,000,000, Process B: ₦1,000,000

D. Process A: ₦1,500,000, Process B: ₦1,500,000

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 13

A country has a GDP of ₦10 trillion and a GNP of ₦11 trillion. What is the likely reason for the difference between the two?

Correct A. The country has a large amount of foreign investment.

B. The country has a large amount of foreign aid.

C. The country has a large amount of foreign debt.

D. The country has a large amount of domestic savings.

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 14

A firm is considering two different pricing strategies for its product. Strategy A is a fixed price of ₦100 per unit, while Strategy B is a price of ₦80 per unit for the first 5,000 units and ₦120 per unit for units above 5,000. If the firm produces 10,000 units of the product, what is the total revenue for each strategy?

A. Strategy A: ₦1,000,000, Strategy B: ₦1,200,000

Correct B. Strategy A: ₦1,200,000, Strategy B: ₦1,000,000

C. Strategy A: ₦1,000,000, Strategy B: ₦1,000,000

D. Strategy A: ₦1,200,000, Strategy B: ₦1,200,000

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 15

A country has a budget deficit of ₦500 billion and a GDP of ₦10 trillion. What is the likely effect of the budget deficit on the country's inflation rate?

Correct A. The inflation rate will increase due to the increase in money supply.

B. The inflation rate will decrease due to the decrease in money supply.

C. The inflation rate will remain unchanged as the increase in money supply is offset by the decrease in demand.

D. The inflation rate will increase due to the increase in government sp\ending.

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 16

Consider a country with a comparative advantage in producing wheat. If the country's production of wheat increases by 20% due to an improvement in techno\logy, and the world price of wheat remains cons\tant, what will be the effect on the country's terms of trade?

A. The country's terms of trade will worsen.

Correct B. The country's terms of trade will improve.

C. The country's terms of trade will remain unchanged.

D. The effect on the country's terms of trade is ambiguous.

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 17

A firm is operating in a perfectly competitive market. If the firm's marginal revenue (MR) is greater than its marginal \cost (MC), what will be the effect on the firm's output?

A. The firm's output will decrease.

Correct B. The firm's output will increase.

C. The firm's output will remain unchanged.

D. The effect on the firm's output is ambiguous.

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 18

A country is experiencing a trade deficit due to an increase in imports. If the country's exchange rate is allowed to float, what will be the effect on the country's trade deficit?

A. The trade deficit will increase.

Correct B. The trade deficit will decrease.

C. The trade deficit will remain unchanged.

D. The effect on the trade deficit is ambiguous.

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 19

A firm is operating in a monopoly market. If the firm's demand curve is downward sloping, what will be the effect on the firm's price?

A. The price will increase.

Correct B. The price will decrease.

C. The price will remain unchanged.

D. The effect on the price is ambiguous.

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 20

A country is experiencing a recession due to a decrease in aggregate demand. If the central bank increases the money supply, what will be the effect on the country's inflation rate?

A. The inflation rate will increase.

Correct B. The inflation rate will decrease.

C. The inflation rate will remain unchanged.

D. The effect on the inflation rate is ambiguous.

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 21

A perfectly competitive market structure is characterized by the presence of many firms producing a homogeneous product, with each firm having no control over the market price. Which of the following is a consequence of this market structure?

A. Firms are able to set their own prices.

Correct B. Firms are price-takers, meaning they have no control over the market price.

C. Firms are able to collude with each other to set prices.

D. Firms are able to produce differentiated products.

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 22

A government budget is a statement of the government's planned revenues and exp\enditures over a specific period of time. Which of the following is a type of government budget?

Correct A. Recurrent budget

B. Capital budget

C. Fiscal budget

D. Monetary budget

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 23

The opportunity \cost of a choice is the value of the next best alternative that is given up as a result of making that choice. Which of the following is an example of an opportunity \cost?

A. The \cost of producing a good or service

Correct B. The value of the next best alternative that is given up

C. The price of a good or service

D. The profit made from selling a good or service

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 24

A monopolistically competitive market structure is characterized by the presence of many firms producing differentiated products, with each firm having some degree of control over the market price. Which of the following is a consequence of this market structure?

A. Firms are able to set their own prices.

B. Firms are price-takers, meaning they have no control over the market price.

Correct C. Firms are able to produce differentiated products.

D. Firms are able to collude with each other to set prices.

Correct Answer: C

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 25

The money supply is the total amount of money available in an economy at any given time. Which of the following is a component of the money supply?

A. Currency in circulation

B. Deposits in commercial banks

C. Time deposits

Correct D. All of the above

Correct Answer: D

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

POST UTME UNIPORT 2019 Economics | Objective

Master the Exam!

Help others prepare! Share this practice hub: