POST UTME VERITAS UNIVERSITY 2020 Economics | Objective
Practice these randomly selected questions to test your readiness.
Question 1
A firm is considering investing in a new project with the following cash flows: Year 1: ₦100, Year 2: ₦120, Year 3: ₦150. If the discount rate is 10%, what is the present value of the project?
Question 2
Consider a production function \( Q = f\( L, K \ \) ) where ( Q ) is the quantity of output, ( L ) is labor, and ( K ) is capital. If the marginal product of labor is \( MP_L = \frac{partial Q}{partial L} = 10 \) and the marginal product of capital is \( MP_K = \frac{partial Q}{partial K} = 5 \), what is the value of the elasticity of substitution between labor and capital?
Question 3
U\sing the concept of elasticity of demand, determine the price elasticity of demand for a good when the quantity demanded is 100 units and the price elasticity of demand is 2.
Question 4
A firm's demand for labor is given by the equation L = 100 - 2W, where W is the wage rate. If the firm's supply of labor is given by L = 2W - 10, find the equilibrium wage rate and quantity of labor.
Question 5
The concept of scarcity in economics implies that the production of one good is limited by the availability of resources, which can be allocated to other goods. This leads to an opportunity \cost, which is the value of the next best alternative foregone as a result of choo\sing one option over another. Which of the following is an example of an opportunity \cost?
Question 6
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, what is the balance of payments?
Question 7
A firm's demand for a product is given by the equation Qd = 100 - 2P and the supply is given by Qs = 2P - 10. If the market is in equilibrium, find the elasticity of demand.
Question 8
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 - 100, what is the equilibrium price?
Question 9
A firm's revenue function is given by R(x) = 2x^2 + 10x. If the firm's marginal revenue function is MR(x) = 4x + 10, what is the value of x that maximizes revenue?
Question 10
A country has a production possibility frontier given by the equation 2Y + 3X = 100, where Y is the quantity of wheat produced and X is the quantity of rice produced. U\sing the concept of opportunity \cost, determine the opportunity \cost of producing 20 units of wheat.
Question 11
Suppose the demand for a product is given by the equation Qd = 100 - 2P and the supply is given by Qs = 2P - 10. Find the equilibrium price and quantity. Assume that the market is in equilibrium.
Question 12
A government imposes a tax of $5 on a firm's output. If the firm's supply function is given by Q = 2P - 5, what is the new supply function?
Question 13
A firm is producing a product u\sing a production function given by Q = 2L^0.5K^0.5, where Q is the output, L is the labor, and K is the capital. If the labor is 100 units and the capital is 200 units, what is the output?
Question 14
A country's trade balance is given by TB = X - M, where X is exports and M is imports. If the country's exports are $100 million and imports are $150 million, what is the value of the trade balance?
Question 15
A firm's production function is given by Q = 100L^0.5K^0.5. If the price of labor increases by 20% and the price of capital increases by 15%, calculate the new value of the marginal product of capital.
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