POST UTME VERITAS UNIVERSITY 2019 Economics | Objective

Practice these randomly selected questions to test your readiness.

Question 1
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 ₦3 respectively, find the consumer's optimal bundle of x and y.
A. x = 40, y = 20
B. x = 30, y = 30
C. x = 20, y = 40
D. x = 10, y = 50
Question 2
The government of Nigeria has implemented a tax on imported goods. U\sing the concept of tax incidence, explain how this tax will affect the consumer and the producer.
A. The tax will increase the price of the good and reduce the quantity demanded.
B. The tax will decrease the price of the good and increase the quantity demanded.
C. The tax will have no effect on the price and quantity of the good.
D. The tax will increase the price of the good and increase the quantity demanded.
Question 3
A consumer's indifference curve is given by the equation U = 2x + 3y, where x and y are the quantities of two goods. If the consumer's budget constraint is 10x + 5y = 100, what is the optimal combination of x and y?
A. x = 5, y = 10
B. x = 10, y = 5
C. x = 15, y = 3
D. x = 20, y = 2
Question 4
A firm's production function is given by \( Q = 2L^2 + 3K^2 \). If the firm's \cost function is \( C = 10L + 20K \), what is the firm's profit-maximizing level of L and K?
A. \( L=5, K=10 \)
B. \( L=10, K=5 \)
C. \( L=15, K=15 \)
D. \( L=20, K=20 \)
Question 5
The Central Bank of Nigeria has increased the reserve requirement for commercial banks from 10% to 15%. U\sing the concept of money supply, explain how this change will affect the money supply in the economy.
A. The money supply will decrease.
B. The money supply will increase.
C. The money supply will remain unchanged.
D. The money supply will fluctuate.
Question 6
The government of Nigeria has implemented a policy to increase agricultural production by providing subsidies to farmers. However, the policy has led to an increase in the price of agricultural products. U\sing the concept of opportunity \cost, explain why the government's policy may not be effective in increa\sing agricultural production.
A. The policy has increased the opportunity \cost of farming, making it less attractive to farmers.
B. The policy has reduced the opportunity \cost of farming, making it more attractive to farmers.
C. The policy has had no effect on the opportunity \cost of farming.
D. The policy has increased the price of agricultural products, making them less competitive in the market.
Question 7
A firm is producing a good with the following \cost and revenue functions: C(x) = 2x^2 + 10x + 5 and R(x) = 3x^2 - 2x + 1. U\sing the concept of profit maximization, find the level of production that will maximize the firm's profit.
A. x = 1
B. x = 2
C. x = 3
D. x = 4
Question 8
A firm's supply curve is given by Q = 2P + 10. If the price elasticity of supply is calculated at a price of ₦20, the value of the elasticity is
A. 0.5
B. 1
C. 2
D. 3
Question 9
A government is considering a tax on a good with a price of ₦100 and a quantity demanded of 100 units. If the tax is ₦20 per unit, what is the deadweight loss?
A. ₦1,000
B. ₦2,000
C. ₦3,000
D. ₦4,000
Question 10
A firm is producing a good with a marginal revenue of ₦50 and a marginal \cost of ₦30. If the price elasticity of demand is 0.5, what is the optimal quantity?
A. 50
B. 75
C. 100
D. 125
Question 11
A farmer produces wheat and maize. The production functions are given by ( W(x,y) = 2x + 3y ) and ( M(x,y) = x^2 + 2y ). If the farmer has 100 units of labour and 50 units of capital, find the optimal input mix to maximize wheat production.
A. x = 20, y = 30
B. x = 30, y = 20
C. x = 40, y = 10
D. x = 50, y = 0
Question 12
The money multiplier is a measure of the change in the money supply resulting from a change in the reserve requirement. If the reserve requirement is increased from 10% to 15%, and the money multiplier is 5, what is the percentage change in the money supply?
A. 25%
B. 50%
C. 75%
D. 100%
Question 13
The national income of a country is given by Y = C + I + G. If the consumption function is given by C = ₦100 + 0.5Y, the marginal propensity to consume is
A. 0.5
B. 0.6
C. 0.7
D. 0.8
Question 14
A firm's \cost function is given by C = 100 + 2L + 3K, where C is the \cost, L is the labor and K is the capital. If the firm wants to minimize its \cost and the price of labor is 10, what is the optimal level of capital?
A. 10
B. 20
C. 30
D. 40
Question 15
A government is considering a budget that allocates 60% of its revenue to education, 20% to healthcare, and 20% to defense. If the total revenue is 100 billion naira, what is the budget for education?
A. 60 billion
B. 62.5 billion
C. 65 billion
D. 67.5 billion

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