All practice questions

A manufacturing firm in Ibadan operates along its Production Possibility Curve (PPC) producing two goods: garments and shoes. Currently, when producing $150$ pairs of shoes, the firm can produce $400$ units of garments. To meet increased market demand for footwear, the firm reallocates its resources to produce $250$ pairs of shoes, causing garment output to fall to $150$ units.

Calculate the opportunity cost of producing one additional pair of shoes in terms of garments foregone.

A manufacturing enterprise operating in the short run incurs a Total Fixed Cost ($\text{TFC}$) of $\text{₦}250$. Its Average Variable Cost ($\text{AVC}$) function is expressed as $\text{AVC} = 3Q^2 - 24Q + 75$, where $Q$ represents the output level in units. What is the firm's Average Total Cost ($\text{ATC}$) in Naira ($\text{₦}$) at the output level where Average Variable Cost ($\text{AVC}$) reaches its minimum?

In an island economy, the physical volume of transactions ($T$) during a fiscal year is $40,000$ units and the average price level ($P$) is $15$ units of currency per transaction. If the total stock of money ($M$) in circulation is $50,000$ units of currency, what is the velocity of money circulation ($V$)?

A commercial farmer in Jos allocates all available agricultural resources to cultivate either Irish potatoes or maize. Using all resources for potatoes yields $100\text{ tonnes}$ of potatoes, while using all resources for maize yields $150\text{ tonnes}$ of maize. Assuming a constant rate of substitution along the production boundary, what is the opportunity cost of producing $1\text{ tonne}$ of potatoes in terms of tonnes of maize?

In Year 1, a country recorded a base price index of $100$. By Year 5, the country's Nominal Gross Domestic Product (GDP) reached $\text{₦}900\text{ billion}$, and its GDP deflator rose to $150$. If the total population in Year 5 stood at $40\text{ million}$, what is the nation's Real Per Capita Income for Year 5 in Naira?

In a foreign exchange market, the daily demand for US Dollars ($\text{USD}$) in Nigeria is represented by the function $Q_d = 250 - 0.25 E$, and the daily supply of US Dollars is represented by $Q_s = 50 + 0.25 E$, where $Q$ is the quantity in millions of US Dollars and $E$ is the exchange rate in Naira per Dollar ($\text{NGN/USD}$). If the monetary authority fixes the exchange rate at $\$1 = \text{NGN } 350$, how many millions of US Dollars must the central bank release from its foreign reserves daily to clear the market deficit and defend this pegged rate?

In a regional agricultural market for cashew nuts, total market demand consists of domestic processing demand ($Q_{dd} = 500 - 8P$) and export demand ($Q_{dx} = 300 - 4P$), where $P$ is the price per bag in thousands of Naira (\text{N}). The market supply from producer cooperatives is given by $Q_s = -100 + 8P$. What is the equilibrium market quantity of cashew nuts in bags?

A table water bottling factory operating in the short run produces $500$ bags of sachet water daily. At this output level, the factory incurs a Total Fixed Cost ($\text{TFC}$) of $\text{₦}12,000$ and an Average Variable Cost ($\text{AVC}$) of $\text{₦}40$ per bag. What is the Average Total Cost ($\text{ATC}$) per bag of sachet water in Naira ($\text{₦}$) at this output level?

The national economic accounts for the Republic of Kwararafa in a given fiscal year are as follows:

- Personal Consumption Expenditure ($C$): $\text{��}450\text{ billion}$
- Gross Private Domestic Investment ($I$): $\text{₦}180\text{ billion}$
- Government Spending ($G$): $\text{₦}220\text{ billion}$
- Exports ($X$): $\text{₦}95\text{ billion}$
- Imports ($M$): $\text{₦}115\text{ billion}$
- Net Factor Income from Abroad ($NFIA$): $-\text{₦}15\text{ billion}$
- Capital Consumption Allowance: $\text{₦}40\text{ billion}$

Based on the expenditure method, calculate the Gross National Product (GNP) at market prices in billions of Naira.

A small-scale garment factory operates in the short run with a fixed quantity of equipment and variable labor ($L$). When $3$ tailors are employed, total output ($TP$) is $45$ shirts per day. When $4$ tailors are employed, total output rises to $64$ shirts per day, and when $5$ tailors are employed, total output reaches $75$ shirts per day. What is the marginal product ($MP$) of the $5\text{th}$ tailor?

In a local agricultural market, the daily demand function for inorganic fertilizer is given by $Q_d = 600 - 15P$ and the supply function is given by $Q_s = -150 + 10P$, where $P$ represents the price per bag in Naira ($\text{N}$). What is the market equilibrium price in Naira?

A commercial printing enterprise operating in the short run produces $5$ thousand brochures at an Average Fixed Cost ($\text{AFC}$) of $\text{₦}160$ per thousand and an Average Variable Cost ($\text{AVC}$) of $\text{₦}120$ per thousand. When the firm expands output to $10$ thousand brochures, its Total Cost ($\text{TC}$) rises to $\text{₦}2,650$. What is the Marginal Cost ($\text{MC}$) per thousand brochures over this range of output?

An economy's balance of payments accounts for a financial year record the following transactions (in millions of US dollars):

Calculate the overall Balance of Payments position in millions of US dollars (use a negative sign to indicate a deficit).

In a given fiscal year, a government's budgetary projections are presented as follows:

Based on the table above, what is the magnitude of the government's budget deficit in billions of Naira?

A cooperative farm produced a total grain harvest of $1,200\text{ bags}$ in a farming season, consisting of $450\text{ bags}$ of maize, $350\text{ bags}$ of sorghum, and $400\text{ bags}$ of rice. What is the sectorial angle representing sorghum when this data is represented on a pie chart?

A palm oil processing mill operates in the short run with fixed processing machinery and variable labor ($L$). When $3$ workers are employed, the average product ($AP$) of labor is $16$ barrels per day. When a $4\text{th}$ worker is added, the total product ($TP$) increases to $64$ barrels per day. What is the marginal product ($MP$) of the $4\text{th}$ worker in barrels per day?

In 2025, Country Alpha recorded a Nominal Gross Domestic Product (GDP) of $\$600\text{ billion}$. The country's GDP deflator was $150$ (with base year index = $100$) and its total population was $80\text{ million}$. To assess living standards accurately, economists adjust national income figures for inflation and population size. What is the Real Per Capita GDP of Country Alpha in dollars?

A bakery in Benin City allocates its daily supply of flour to produce either 100 loaves of bread or 50 meat pies. Currently, the bakery produces 20 meat pies. If the baker decides to increase meat pie production to 35 meat pies, what is the opportunity cost of this decision in terms of loaves of bread foregone?

An economy's current equilibrium national income is $\$1,200\text{ billion}$, while its full-employment potential national income is $\$1,500\text{ billion}$. The consumption function is $C = 150 + 0.75Y_d$, where $Y_d$ is disposable income ($Y_d = Y - T$), and the tax function is $T = 40 + 0.20Y$, where $Y$ is national income. To achieve economic stabilization at full employment using fiscal policy, by how much (in billions of dollars) must the government increase its expenditure ($G$)?

A nation's total federal budget of $₦500\text{ billion}$ is allocated across four key sectors: Health ($₦125\text{ billion}$), Education ($₦175\text{ billion}$), Defense ($₦120\text{ billion}$), and Agriculture (the remainder). In a pie chart constructed to represent this budget distribution, what is the central angle (in degrees) representing the allocation for Agriculture?