All practice questions

In a non-collusive oligopolistic market, a leading firm faces a kinked demand curve with two distinct price-demand relationships: for price increases above the current equilibrium, the demand curve is $P_1 = 280 - 2Q$; for price cuts below the current equilibrium, the demand curve is $P_2 = 400 - 5Q$, where $P$ is price in Naira (₦) and $Q$ is output in units. What is the value of the vertical discontinuity (gap) in the firm's marginal revenue curve at the kink equilibrium quantity?

In an economy operating under Fisher's Quantity Theory of Money ($MV = PT$), the initial stock of money ($M$) is ₦500 million, the velocity of money circulation ($V$) is 4, and the total volume of transactions ($T$) is 100 million units. If the money supply increases by $25\%$, the velocity of circulation decreases by $10\%$, and the volume of transactions increases by $25\%$, what is the new price level ($P$)?

A consumer's maximum willingness to pay for successive packets of milk in a retail market is given in the schedule below:

If the market price of a packet of milk is fixed at ₦200, what is the total consumer surplus (in Naira) enjoyed by the consumer when purchasing 4 packets?

The table below shows the output of Cocoa (bags) and Solar Panels (units) produced per unit of labor in Country A and Country B:

Before trade, each country possesses 10 units of labor and allocates 5 units of labor to Cocoa production and 5 units of labor to Solar Panel production. If both countries decide to specialize completely according to the principle of comparative advantage, what is the net increase in total world output of Cocoa?

An economy recorded the following macroeconomic expenditure components during a fiscal year: Personal Consumption Expenditure ($C$) of $\$650$ million, Gross Private Domestic Investment ($I$) of $\$220$ million, Government Purchase of Goods and Services ($G$) of $\$310$ million, Exports ($X$) of $\$140$ million, and Imports ($M$) of $\$160$ million. Additionally, Net Factor Income from Abroad ($NFIA$) was $\$25$ million. Calculate the Gross National Product at market price ($GNP_{mp}$) of this economy in millions of dollars.

In a competitive market for cassava flour, the weekly demand function is given by $Q_d = 320 - 15P$ and the supply function is $Q_s = -40 + 10P$, where $P$ is the price in Naira per kilogram, $Q_d$ is the quantity demanded in kilograms, and $Q_s$ is the quantity supplied in kilograms. What is the magnitude of the excess demand (shortage) in kilograms when the market price is fixed at $₦12$ per kilogram?

A consumer's demand function for petrol in a local Nigerian market is given by the linear equation $P = 200 - 8Q$, where $P$ represents the price per liter in Naira and $Q$ represents the quantity demanded in liters. If the current market price of petrol is established at $\text{N}80$ per liter, calculate the consumer surplus in Naira.

The central monetary authority of an economy published the following financial statistics (in billions of Naira):

- Currency notes and coins held by the non-bank public: $380$
- Vault cash inside commercial bank tills: $70$
- Demand deposits of the non-bank public at commercial banks: $620$
- Savings and fixed time deposits at commercial banks: $950$
- Government deposits held at the central bank: $150$

Calculate the total value of narrow money supply ($M_1$) in billions of Naira.

A West African nation records the following international transactions during a financial year:

Based on the table, calculate the country's Current Account Balance in millions of US dollars ($ million).

In an economic statistics report of a country, the total currency in circulation outside commercial banks is $\text{N}300\text{ billion}$ and demand deposits held in commercial banks total $\text{N}500\text{ billion}$. In addition, savings deposits stand at $\text{N}250\text{ billion}$. What is the value of the narrow money supply ($M_1$) in billions of Naira?

In a national economy, the initial money supply ($M$) is $\text{N}800$ billion and the velocity of circulation ($V$) is $5$. The total volume of physical transactions ($T$) is $200$ million units. If the monetary authority increases the money supply by $25\%$ while the velocity of circulation declines by $10\%$, assuming the general price level ($P$) remains constant, what is the new total volume of transactions ($T$) in millions of units?

If the foreign exchange rate of the US Dollar ($) against the Nigerian Naira (₦) changes from$ 1 = ₦400 to $1 = ₦500, what is the percentage depreciation of the Naira against the US Dollar?

An individual earns a taxable annual income of $\text{N}500,000$. Under a proportional tax system with a fixed tax rate of $15\%$, calculate the total tax paid in Naira.

A consumer is willing to pay a maximum of ₦8,500 for a new textbook, but purchases it in the market for ₦5,800. What is the value of the consumer surplus in Naira?

An individual consumer's weekly demand function for sugar is expressed as $Q_d = 120 - 4P$, where $Q_d$ represents the quantity demanded in bags and $P$ represents the price per bag in Naira ($\text{₦}$). According to the law of demand, by how many bags does the quantity demanded decrease when the price per bag increases from $\text{₦}10$ to $\text{₦}15$?

Apex Plc has an issued share capital of $800,000$ ordinary shares of $\text{₦}0.50$ each. The company announces a bonus issue of $1$ new ordinary share for every $4$ shares held. Following the completion of the bonus issue, the company makes a rights issue of $1$ new ordinary share for every $5$ existing shares held at an issue price of $\text{₦}1.20$ per share. What is the total value of the company's issued ordinary share capital in Naira ($\text{₦}$) after both the bonus issue and rights issue are fully executed?

A firm operating in the short run employs labor as a variable input while keeping capital fixed. When the firm employs $4$ workers, total output is $120$ units. When a $5$ th worker is added, total output increases to $145$ units. What is the marginal product of the $5$ th worker in units?

A textile manufacturing firm operating in Kano State increases all of its factor inputs by $50\%$ in order to expand its scale of production. Following this scale expansion, the firm's total weekly output of fabric rises from $20,000\text{ meters}$ to $35,000\text{ meters}$. What is the percentage increase in the firm's total output?

What is the volume of chlorine gas produced at s.t.p., in $\text{dm}^3$, when $8.7\text{ g}$ of manganese(IV) oxide ($MnO_2$) reacts completely with excess concentrated hydrochloric acid ($HCl$)? [Molar volume of gas at s.t.p. = $22.4\text{ dm}^3\text{mol}^{-1}$, $Mn = 55$, $O = 16$]

In an international trade model involving two nations, Country X and Country Y, the labor-hours required to produce one unit of Machinery and one unit of Fertilizer are shown in the table below:

Assuming both countries trade according to the principle of comparative advantage, what is the maximum number of units of Fertilizer that Country X is willing to exchange for $1$ unit of Machinery?