POST UTME WELLSPRING UNIVERSITY 2017 Economics | Objective

Are you preparing for POST UTME WELLSPRING UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2017 Economics (Objective) questions designed to simulate the real exam environment.

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Question 1
A firm's revenue function is given by R(x) = 100x - 2x^2. If the firm's marginal revenue is 50, find the value of x.
A. 10
Correct B. 20
C. 30
D. 40

Correct Answer: B

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Question 2
A consumer's utility function is given by 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.
Correct A. (10,20)
B. (20,10)
C. (30,5)
D. (5,30)

Correct Answer: A

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Question 3
A firm's \cost function is given by C(x) = 100 + 2x^2. If the firm's revenue function is R(x) = 100x - 2x^2, find the firm's profit function.
Correct A. R(x) - C(x)
B. C(x) - R(x)
C. R(x) + C(x)
D. C(x) - R(x)

Correct Answer: A

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Question 4
A country's balance of payments is given by BOP = X - M. If the country's exports are ₦1000 and its imports are ₦500, find the country's balance of payments.
A. ₦500
Correct B. ₦1000
C. ₦1500
D. ₦2000

Correct Answer: B

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Question 5
A firm's supply function is given by Q = 100 + 2P. If the firm's demand function is Q = 100 - 2P, find the firm's equilibrium price and quantity.
A. (₦50, 150)
Correct B. (₦75, 125)
C. (₦100, 100)
D. (₦125, 75)

Correct Answer: B

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Question 6
A firm's demand function is given by Qd = 100 - 2P, where Qd is the quantity demanded and P is the price. If the price elasticity of demand is -2, what is the percentage change in quantity demanded when the price increases by 10%?
Correct A. 20%
B. 30%
C. 40%
D. 50%

Correct Answer: A

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Question 7
A government imposes a tax of ₦10 on a firm's output. If the firm's supply function is given by Qs = 100 + 2P, where Qs is the quantity supplied and P is the price, what is the new supply function after the tax is imposed?
Correct A. Qs = 100 + 2P - 10
B. Qs = 100 + 2P + 10
C. Qs = 100 - 2P - 10
D. Qs = 100 - 2P + 10

Correct Answer: A

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Question 8
A firm's total revenue function is given by TR = 100P - P^2, where TR is the total revenue and P is the price. If the firm sells 100 units at a price of ₦20, what is the total revenue?
A. ₦1000
Correct B. ₦2000
C. ₦3000
D. ₦4000

Correct Answer: B

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Question 9
A firm's production function is given by Q = 2L^0.5K^0.5, where Q is the output, L is the labor, and K is the capital. If the firm uses 100 units of labor and 100 units of capital, what is the output?
A. 100
B. 200
Correct C. 300
D. 400

Correct Answer: C

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Question 10
A firm's budget constraint is given by 2L + 3K = 100, where L is the labor and K is the capital. If the firm uses 50 units of labor, what is the maximum amount of capital it can use?
A. 20
B. 30
Correct C. 40
D. 50

Correct Answer: C

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Question 11
The elasticity of demand for a commodity is measured by the percentage change in the quantity demanded in response to a 1% change in the price of the commodity. If the demand for a commodity is elastic, what will be the effect on the total revenue of the firm?
A. Total revenue will increase
Correct B. Total revenue will decrease
C. Total revenue will remain cons\tant
D. Total revenue will increase at a decrea\sing rate

Correct Answer: B

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Question 12
A firm is producing a commodity at a point where the marginal revenue product of labor is equal to the wage rate. If the firm increases the wage rate, what will be the effect on the quantity of labor employed?
A. The quantity of labor employed will increase
Correct B. The quantity of labor employed will decrease
C. The quantity of labor employed will remain cons\tant
D. The quantity of labor employed will increase at a decrea\sing rate

Correct Answer: B

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Question 13
A country's GDP is ₦100 billion. The government imposes a 10% tax on all goods and services. What will be the effect on the country's GDP?
Correct A. GDP will decrease by ₦10 billion
B. GDP will increase by ₦10 billion
C. GDP will remain cons\tant
D. GDP will increase by ₦1 billion

Correct Answer: A

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Question 14
A firm is producing a commodity at a point where the marginal \cost of production is equal to the marginal revenue. If the firm increases the price of the commodity, what will be the effect on the quantity supplied?
Correct A. The quantity supplied will increase
B. The quantity supplied will decrease
C. The quantity supplied will remain cons\tant
D. The quantity supplied will increase at a decrea\sing rate

Correct Answer: A

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Question 15
A country's GNP is ₦120 billion. The country imports goods and services worth ₦20 billion. What will be the effect on the country's GDP?
A. GDP will increase by ₦20 billion
Correct B. GDP will decrease by ₦20 billion
C. GDP will remain cons\tant
D. GDP will increase by ₦10 billion

Correct Answer: B

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Question 16
A firm's production function is given by Q = 2L^0.5K^0.5, where Q is output, L is labor, and K is capital. If the firm's current labor and capital inputs are 4 and 9 units respectively, what is the marginal product of labor (MPL) when K = 9?
Correct A. 1/2
B. 1
C. 2
D. 3

Correct Answer: A

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Question 17
A consumer's budget constraint is given by P1X + P2Y = 100, where P1 and P2 are the prices of goods X and Y respectively, and X and Y are the quantities consumed. If the consumer's current consumption is (X, Y) = (20, 15), what is the consumer's marginal rate of substitution (MRS) of good X for good Y?
Correct A. -1/3
B. -1/2
C. -1
D. -2

Correct Answer: A

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Question 18
A country's GDP is given by the equation GDP = C + I + G + \( X - M \), where C is consumption, I is investment, G is government sp\ending, X is exports, and M is imports. If the country's current GDP is 100 billion, and the values of C, I, G, X, and M are 60, 20, 10, 15, and 5 respectively, what is the value of the country's net exports \( X - M \)?
A. 5
B. 10
Correct C. 15
D. 20

Correct Answer: C

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Question 19
A firm's production function is given by Q = 3L^0.5K^0.5, where Q is output, L is labor, and K is capital. If the firm's current labor and capital inputs are 9 and 4 units respectively, what is the marginal product of capital (MPK) when L = 9?
Correct A. 1/2
B. 1
C. 2
D. 3

Correct Answer: A

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Question 20
A country's GNP is given by the equation GNP = GDP + (net factor income from abroad). If the country's current GNP is 120 billion, and the value of GDP is 100 billion, what is the value of the country's net factor income from abroad?
A. 10
Correct B. 20
C. 30
D. 40

Correct Answer: B

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Question 21
Consider a consumer with a utility function ( U(x,y) = 2x + 3y - x^2 - 2y^2 ). If the consumer's income is ₦1000 and the prices of x and y are ₦5 and ₦3 respectively, find the optimal bundle of x and y.
Correct A. (20, 10)
B. (15, 5)
C. (10, 20)
D. (5, 15)

Correct Answer: A

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Question 22
A firm has a production function \( Q = 2L^2 + 3K^2 \). If the firm's output is 100 units and the price of labor is ₦10 per unit and the price of capital is ₦20 per unit, find the optimal combination of labor and capital.
Correct A. (10, 5)
B. (5, 10)
C. (15, 3)
D. (20, 2)

Correct Answer: A

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Question 23
Consider a country with a trade balance of ₦100 billion and a current account balance of ₦50 billion. If the country's GDP is ₦500 billion, what is the country's net foreign assets?
Correct A. ₦150 billion
B. ₦200 billion
C. ₦250 billion
D. ₦300 billion

Correct Answer: A

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Question 24
A firm is considering investing in a new project with a net present value of ₦100 million. If the firm's \cost of capital is 10%, what is the project's internal rate of return?
Correct A. 12%
B. 15%
C. 18%
D. 20%

Correct Answer: A

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Question 25
Consider a market with a demand function \( Q = 100 - 2P \) and a supply function \( Q = 2P - 10 \). If the market is in equilibrium, what is the price and quantity?
Correct A. P = ₦20, Q = 30
B. P = ₦30, Q = 40
C. P = ₦40, Q = 50
D. P = ₦50, Q = 60

Correct Answer: A

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