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POST UTME UNN 2020 Economics | Objective

Are you preparing for POST UTME UNN exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2020 Economics (Objective) questions designed to simulate the real exam environment.

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Question 1

Consider a perfectly competitive market with 5 firms, each producing a homogeneous product. If the market demand curve is given by Qd = 100 - 2P and the market supply curve is given by Qs = 2P - 20, find the equilibrium price and quantity.

A. ₦50, 100 units

Correct B. ₦75, 50 units

C. ₦25, 150 units

D. ₦100, 25 units

Correct Answer: B

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Question 2

A government imposes a tax of ₦10 on a firm's output. If the firm's supply curve is given by Qs = 2P - 20, find the new supply curve and the deadweight loss.

Correct A. Qs = 2P - 30

B. Qs = 2P - 25

C. Qs = 2P - 20

D. Qs = 2P - 15

Correct Answer: A

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Question 3

Consider a monopolistically competitive market with 5 firms, each producing a differentiated product. If the market demand curve is given by Qd = 100 - 2P and the market supply curve is given by Qs = 2P - 20, find the equilibrium price and quantity.

A. ₦50, 100 units

Correct B. ₦75, 50 units

C. ₦25, 150 units

D. ₦100, 25 units

Correct Answer: B

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Question 4

A country's balance of payments is given by the following equation: BOP = $ X - M $ + $ F - I $. If the country's exports are ₦100 billion, imports are ₦80 billion, foreign investment is ₦20 billion, and domestic investment is ₦30 billion, find the balance of payments.

Correct A. ₦10 billion

B. ₦20 billion

C. ₦30 billion

D. ₦40 billion

Correct Answer: A

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Question 5

Consider a market with a demand curve given by Qd = 100 - 2P and a supply curve given by Qs = 2P - 20. If the government imposes a tax of ₦10 on the firm's output, find the new supply curve and the deadweight loss.

Correct A. Qs = 2P - 30

B. Qs = 2P - 25

C. Qs = 2P - 20

D. Qs = 2P - 15

Correct Answer: A

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Question 6

The demand for a product is given by the equation Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. If the price elasticity of demand is 0.5, what is the percentage change in quantity demanded when the price increases by 10%?

Correct A. 5%

B. 10%

C. 20%

D. 30%

Correct Answer: A

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Question 7

A firm produces two goods, X and Y, u\sing two inputs, labor (L) and capital (K). The production functions are given by X = 2L + 3K and Y = 4L + 2K. If the firm has 10 units of labor and 5 units of capital, what is the total output $ X + Y $?

A. 50

B. 60

Correct C. 70

D. 80

Correct Answer: C

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Question 8

A consumer has the following utility function: U = 2X + 3Y, where X and Y are the quantities of two goods. If the prices of X and Y are $2 and $3 respectively, and the consumer has a budget of $10, what is the optimal bundle of goods?

Correct A. X = 2, Y = 2

B. X = 3, Y = 1

C. X = 4, Y = 0

D. X = 0, Y = 3

Correct Answer: A

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Question 9

A firm is considering two investment projects, A and B. Project A has a \cost of $100,000 and a return of $120,000, while project B has a \cost of $150,000 and a return of $180,000. If the firm has a discount rate of 10%, which project should it choose?

Correct A. Project A

B. Project B

C. Both projects

D. Neither project

Correct Answer: A

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Question 10

A country has a production function given by Y = 2L^0.5 + 3K^0.5, where Y is the output, L is the labor and K is the capital. If the country has 100 units of labor and 200 units of capital, what is the output?

A. 200

B. 250

Correct C. 300

D. 350

Correct Answer: C

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Question 11

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 = 10 and MC = 8, what is the optimal quantity of output (Q) that the firm should produce?

A. 6 units

B. 8 units

Correct C. 10 units

D. 12 units

Correct Answer: C

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Question 12

A country's balance of payments (BOP) accounts can be affected by various factors. Which of the following factors is NOT a component of the current account?

A. Exports

B. Imports

Correct C. Foreign Direct Investment (FDI)

D. Remit\tances

Correct Answer: C

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Question 13

A firm's demand curve is given by the equation Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. If the firm's supply curve is given by the equation Qs = 2P - 50, where Qs is the quantity supplied, what is the equilibrium price (P) and quantity (Q) in the market?

A. P = 25, Q = 50

Correct B. P = 30, Q = 60

C. P = 35, Q = 70

D. P = 40, Q = 80

Correct Answer: B

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Question 14

Consider a country with a fixed exchange rate regime. If the country's central bank wants to increase the money supply, what is the most likely action it would take?

A. Increase the reserve requirement

B. Decrease the discount rate

Correct C. Increase the money supply by buying government securities

D. Increase the exchange rate

Correct Answer: C

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Question 15

A firm's production function is given by the equation Q = 2L^0.5, where Q is the quantity produced and L is the labor input. If the firm's wage rate is $10 per hour, what is the optimal level of labor input (L) that the firm should hire to maximize profits?

A. 4 hours

Correct B. 6 hours

C. 8 hours

D. 10 hours

Correct Answer: B

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Question 16

The opportunity \cost of producing one more unit of a good is the value of the next best alternative that must be given up. If the production of a good increases the output of another good, the opportunity \cost is said to be _______________.

A. zero

Correct B. positive

C. negative

D. neutral

Correct Answer: B

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Question 17

The law of diminishing marginal utility states that as the consumption of a good increases, the marginal utility derived from each additional unit of the good _______________.

A. increases

Correct B. decreases

C. remains cons\tant

D. fluctuates

Correct Answer: B

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Question 18

A country's balance of payments is said to be in equilibrium when the value of its imports equals the value of its _______________.

Correct A. exports

B. imports

C. capital inflow

D. capital outflow

Correct Answer: A

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Question 19

The money supply in an economy is the total amount of money circulating in the economy, including _______________ and currency in circulation.

A. bank deposits

B. currency in circulation

C. checkable deposits

Correct D. all of the above

Correct Answer: D

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Question 20

The demand curve for a good is said to be elastic when the percentage change in the quantity demanded of the good is greater than the percentage change in the price of the good. This occurs when the demand curve is _______________.

Correct A. horizontal

B. vertical

C. inelastic

D. unit elastic

Correct Answer: A

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Question 21

Consider a perfectly competitive market with n firms, each producing a homogeneous product. If the market price is P = 10, and the marginal \cost (MC) of each firm is 5, what is the profit-maximizing quantity $ Q* $ for each firm?

Correct A. $ Q^* = \frac{P - MC}{2} $

B. $ Q^* = \frac{P + MC}{2} $

C. $ Q^* = \frac{P - MC}{MC} $

D. $ Q^* = \frac{P + MC}{MC} $

Correct Answer: A

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Question 22

A firm is producing a good u\sing a production function with the following characteristics: Q = 2L^0.5K^0.5. If the firm's current inputs are L = 4 and K = 9, what is the marginal product of labor (MPL) at this point?

Correct A. $ MPL = \frac{partial Q}{partial L} = \frac{K^{0.5}}{L^{0.5}} $

B. $ MPL = \frac{partial Q}{partial L} = \frac{L^{0.5}}{K^{0.5}} $

C. $ MPL = \frac{partial Q}{partial L} = \frac{2L^{0.5}K^{0.5}}{L} $

D. $ MPL = \frac{partial Q}{partial L} = \frac{2L^{0.5}K^{0.5}}{K} $

Correct Answer: A

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Question 23

A country is experiencing a trade deficit due to a decrease in exports and an increase in imports. If the country's GDP is 100 billion, and the trade deficit is 20 billion, what is the percentage change in the trade deficit?

Correct A. $ \frac{20}{100} \times 100 = 20% $

B. $ \frac{20}{100} \times 100 = 2% $

C. $ \frac{20}{100} \times 100 = 200% $

D. $ \frac{20}{100} \times 100 = 0.2% $

Correct Answer: A

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Question 24

A firm is considering investing in a new project with the following cash flows: Year 1: -10, Year 2: 20, Year 3: 30. If the firm's \cost of capital is 10%, what is the net present value (NPV) of the project?

Correct A. $ NPV = -10 + \frac{20}{1.1} + \frac{30}{1.1^2} $

B. $ NPV = -10 + \frac{20}{1.1^2} + \frac{30}{1.1} $

C. $ NPV = -10 + \frac{20}{1.1} + \frac{30}{1.1^2} - 10 $

D. $ NPV = -10 + \frac{20}{1.1^2} + \frac{30}{1.1} - 10 $

Correct Answer: A

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Question 25

A country is experiencing a recession due to a decrease in aggregate demand. If the country's GDP is 100 billion, and the recession is cau\sing a 10% decrease in GDP, what is the new GDP?

Correct A. $ 100 - 10 = 90 $

B. $ 100 + 10 = 110 $

C. $ 100 \times 0.9 = 90 $

D. $ 100 \times 1.1 = 110 $

Correct Answer: A

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