All practice questions

An economy is currently operating at point $A$ on its Production Possibility Curve, producing $120$ units of consumer goods and $50$ units of capital goods. To meet a new production target, the economy shifts resources to point $B$, increasing the production of capital goods to $80$ units, while consumer goods production drops to $90$ units. What is the opportunity cost of producing the additional capital goods, expressed in units of consumer goods?

An economy recorded the following national income components for a given fiscal year:

Using the income method of measuring national income, what is the Gross Domestic Product at factor cost (in ₦ million)?

The following financial data (in millions of dollars) was extracted from the national income accounting records of a nation for a given fiscal year:

Based on the information provided above, calculate the Net National Product at factor cost ($NNP_{FC}$) in millions of dollars.

The national accounts of the Republic of Zaria for a given fiscal year present the following macroeconomic components (in billions of Naira):

- Personal Consumption Expenditure ($C$): 850
- Gross Domestic Private Investment ($I$): 320
- Government Final Consumption Spending ($G$): 280
- Exports ($X$): 190
- Imports ($M$): 230
- Net Factor Income from Abroad ($NFIA$): -45
- Capital Consumption Allowance: 60
- Net Indirect Taxes (Indirect Taxes minus Subsidies): 35

Calculate the Net National Product at factor cost ($NNP_{fc}$) in billions of Naira.

In a local market economy, the total stock of money in circulation ($M$) is $\text{N}2,500,000$, and the velocity of circulation ($V$) is $6$. If the total volume of physical transactions ($T$) is $300,000$ units, what is the general price level ($P$) per unit in Naira?

A specific tax of $\text{₦}50$ per unit is imposed on a commodity whose initial equilibrium price is $\text{₦}200$. Following the introduction of the tax, the market price paid by consumers rises to $\text{₦}235$. What percentage of the total tax burden per unit is borne by the producer?

An economy recorded the following international transactions during a financial year (all figures in millions of US dollars):

Based on the table above, what is the overall balance of payments surplus or deficit (in millions of US dollars) before official reserves adjustments?

A shoe manufacturing workshop operates in the short run with a fixed building and machinery. When employing $5$ workers, the average product of labor is $28$ pairs of shoes per day. Adding a $6\text{th}$ worker brings total output to $168$ pairs per day. Upon hiring a $7\text{th}$ worker, the law of diminishing returns causes the marginal product of the $7\text{th}$ worker to be $50\%$ lower than the marginal product of the $6\text{th}$ worker. What is the average product of labor (in pairs of shoes per day) when $7$ workers are employed?

The price elasticity of demand for a manufactured commodity is $0.4$, while its price elasticity of supply is $1.6$. If the government imposes a specific excise tax of $\text{₦}250$ per unit on the commodity, what is the tax burden per unit borne by the consumer in Naira?

A consumer allocates a total income of ₦$15,000$ exclusively to buy Good $X$ and Good $Y$. The price of Good $X$ ($P_X$) is ₦$1,500$ per unit, and the price of Good $Y$ ($P_Y$) is ₦$1,000$ per unit. If the consumer buys $6$ units of Good $X$, what is the maximum number of units of Good $Y$ that can be purchased?

In a local market, the demand function for rice is given by $Q_d = 80 - 4P$ and the supply function is given by $Q_s = 20 + 6P$, where $P$ is the price in Naira per bag. What is the market equilibrium price (in Naira)?

A consumer allocating an income of $\text{₦}1,800$ between Good $X$ and Good $Y$ faces market prices of $P_x = \text{₦}40$ and $P_y = \text{₦}30$ per unit, respectively. The consumer's Marginal Rate of Substitution of Good $X$ for Good $Y$ is given by $MRS_{xy} = \frac{2Y}{X}$. Assuming the consumer maximizes satisfaction subject to their budget constraint, how many units of Good $X$ will be consumed at equilibrium?

A consumer achieves equilibrium under the ordinal utility framework while purchasing Good $X$ and Good $Y$. If the market price of Good $X$ is $\text{₦}150$ and the market price of Good $Y$ is $\text{₦}50$, calculate the Marginal Rate of Substitution of Good $X$ for Good $Y$ ($MRS_{xy}$) at the equilibrium point.

A consumer allocates a monthly income of $\text{₦}12,000$ between Good $X$ and Good $Y$. The market price of Good $Y$ is $\text{₦}400$ per unit. At consumer equilibrium under ordinal utility analysis, the consumer purchases $15$ units of Good $Y$. If the Marginal Rate of Substitution of Good $X$ for Good $Y$ ($MRS_{xy}$) at this equilibrium point is $1.5$, how many units of Good $X$ does the consumer purchase?

During a financial reporting period, a nation exported $640 million worth of physical merchandise and imported$ 810 million worth of physical merchandise. Over the same period, the country recorded +$115 million in net invisible trade (services) and received$ 50 million in net unilateral transfers from abroad. Calculate the nation's current account balance in millions of dollars (use a negative sign to indicate a deficit).

In an open four-sector economy, the circular flow of income is in equilibrium when total leakages (withdrawals) equal total injections. If planned savings ($S$) is $\$80\text{ million}$, imports ($M$) are $\$45\text{ million}$, planned investment ($I$) is $\$95\text{ million}$, government expenditure ($G$) is $\$60\text{ million}$, and exports ($X$) are $\$40\text{ million}$, what is the required value of government tax revenue ($T$) in millions of dollars?

The following financial statistics were extracted from the national income accounts of an economy for a given fiscal year:

Using the income method, calculate the Gross Domestic Product ($GDP$) at factor cost in ₦ million.

In a fiscal year, a government spent a total of $\text{N}1.20\text{ trillion}$ on public expenditure. If capital expenditure on development projects accounted for $\text{N}450\text{ billion}$, what percentage of the total public expenditure was allocated to recurrent expenditure?

The following table presents the macroeconomic accounts of a West African economy for a given fiscal year:

Using the expenditure method, what is the Net National Product at factor cost ($NNP_{fc}$) of the country in millions of Naira?