POST UTME ABU 2021 Commerce | Objective

Are you preparing for POST UTME ABU exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2021 Commerce (Objective) questions designed to simulate the real exam environment.

Practice these randomly selected questions to test your readiness.

Question 1
A company specializing in the production of motor vehicles has a production process that involves the assembly of various components. If the company's production process can be represented by the following flowchart, what is the probability that the production process will be completed within 8 hours?
Correct A. 0.5
B. 0.6
C. 0.7
D. 0.8

Correct Answer: A

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Question 2
A company has two warehouses, A and B, located 100 km apart. Warehouse A has a stock of 500 units of a product, while warehouse B has a stock of 300 units. If the company wants to transfer 100 units from warehouse A to warehouse B, and the transportation cost is ₦10 per km, what is the total cost of transportation?
A. ₦1000
Correct B. ₦1200
C. ₦1500
D. ₦1800

Correct Answer: B

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Question 3
A company has a production process that involves the use of a machine that can produce 100 units of a product per hour. If the company wants to produce 500 units of the product, and the machine is available for 5 hours, what is the probability that the production process will be completed within the specified time?
A. 0.8
B. 0.9
Correct C. 0.95
D. 0.99

Correct Answer: C

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Question 4
A company has a stock of 1000 units of a product, and the demand for the product is 500 units per month. If the company wants to maintain a stock level of at least 500 units, what is the minimum number of units that the company should order each month?
A. 200
Correct B. 250
C. 300
D. 350

Correct Answer: B

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Question 5
A company has a production process that involves the use of a machine that can produce 200 units of a product per hour. If the company wants to produce 1000 units of the product, and the machine is available for 4 hours, what is the probability that the production process will be completed within the specified time?
A. 0.8
B. 0.9
Correct C. 0.95
D. 0.99

Correct Answer: C

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Question 6
The concept of comparative advantage in international trade suggests that countries should specialize in producing goods for which they have a lower opportunity cost. What is the opportunity cost of producing a good?
Correct A. The value of the good in terms of other goods that could be produced instead
B. The price of the good in the market
C. The quantity of the good produced
D. The quality of the good produced

Correct Answer: A

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Question 7
A company is considering expanding its operations into a new market. The company has identified three potential markets: Market A, Market B, and Market C. Market A has a large population, but the company's product is not well-known in this market. Market B has a moderate population, but the company's product is moderately well-known in this market. Market C has a small population, but the company's product is very well-known in this market. Which market should the company choose to expand into?
A. Market A
B. Market B
Correct C. Market C
D. Market D

Correct Answer: C

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Question 8
A firm is producing two goods, X and Y, using two inputs, labor and capital. The production function for good X is given by Q_X = 2L^0.5K^0.5, where Q_X is the quantity of good X produced, L is the amount of labor used, and K is the amount of capital used. The production function for good Y is given by Q_Y = 3L^0.2K^0.8, where Q_Y is the quantity of good Y produced. If the firm uses 100 units of labor and 200 units of capital, how many units of good X and good Y will the firm produce?
Correct A. Q_X = 100, Q_Y = 200
B. Q_X = 200, Q_Y = 100
C. Q_X = 50, Q_Y = 150
D. Q_X = 150, Q_Y = 50

Correct Answer: A

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Question 9
A company is considering launching a new product. The company has estimated that the demand for the product will be 100 units per month at a price of ₦100 per unit. The company's cost of production is ₦50 per unit. If the company wants to make a profit of ₦10 per unit, what should be the price of the product?
A. ₦120
Correct B. ₦130
C. ₦140
D. ₦150

Correct Answer: B

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Question 10
A firm is producing a good using two inputs, labor and capital. The production function for the good is given by Q = 2L^0.5K^0.5, where Q is the quantity of the good produced, L is the amount of labor used, and K is the amount of capital used. If the firm uses 100 units of labor and 200 units of capital, what is the quantity of the good produced?
A. 50
Correct B. 100
C. 200
D. 300

Correct Answer: B

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Question 11
A firm specializes in producing only one product. This specialization leads to economies of scale in production. However, it also means that the firm is vulnerable to fluctuations in demand for that product. What is the name of this phenomenon?
A. Risk
B. Uncertainty
Correct C. Economies of scale
D. Diversification

Correct Answer: C

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Question 12
A bank offers a 5-year fixed deposit account with an interest rate of 8% per annum compounded annually. If a customer deposits ₦100,000 at the beginning of the first year, how much will the customer have at the end of the fifth year?
Correct A. ₦164,848.10
B. ₦164,848.20
C. ₦164,848.30
D. ₦164,848.40

Correct Answer: A

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Question 13
A company has a sole proprietorship business structure. What is the primary advantage of this business structure?
Correct A. Easy to set up
B. Limited liability
C. Unlimited liability
D. Tax benefits

Correct Answer: A

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Question 14
A firm is considering launching a new product. The marketing manager has identified two target markets: Market A and Market B. Market A has a larger population but lower disposable income, while Market B has a smaller population but higher disposable income. Which market should the firm target?
A. Market A
Correct B. Market B
C. Both markets
D. Neither market

Correct Answer: B

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Question 15
A company has a business insurance policy that covers losses due to fire, theft, and natural disasters. What type of insurance policy is this?
A. Liability insurance
Correct B. Property insurance
C. Casualty insurance
D. Workers' compensation insurance

Correct Answer: B

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Question 16
A company's production function is given by Q = 100L^0.5K^0.25, where Q is output, L is labor, and K is capital. If labor increases by 20% and capital remains constant, what is the percentage change in output?
A. 10%
Correct B. 20%
C. 30%
D. 40%

Correct Answer: B

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Question 17
A firm's revenue function is given by R(x) = 2x^2 + 5x - 3, where x is the number of units sold. If the firm sells 10 units, what is the marginal revenue?
A. 29
Correct B. 31
C. 33
D. 35

Correct Answer: B

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Question 18
A company has a warehouse with a capacity of 1000 units. The warehouse is currently 75% full. If 200 units are added to the warehouse, what is the new percentage of capacity?
A. 80%
Correct B. 85%
C. 90%
D. 95%

Correct Answer: B

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Question 19
A firm's production function is given by Q = 2L^0.5K^0.25, where Q is output, L is labor, and K is capital. If labor increases by 20% and capital remains constant, what is the percentage change in output?
A. 10%
Correct B. 20%
C. 30%
D. 40%

Correct Answer: B

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Question 20
A company has a warehouse with a capacity of 1000 units. The warehouse is currently 75% full. If 200 units are added to the warehouse, what is the new percentage of capacity?
A. 80%
Correct B. 85%
C. 90%
D. 95%

Correct Answer: B

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Question 21
A company's marketing strategy involves creating a brand identity that appeals to a specific demographic. Which of the following is a characteristic of this demographic?
Correct A. Young adults aged 18-35
B. Middle-aged adults aged 45-60
C. Retirees aged 65 and above
D. Children under the age of 18

Correct Answer: A

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Question 22
A bank's financial statement shows a net income of ₦1.2 billion. If the bank's total assets are ₦5.5 billion and its total liabilities are ₦3.8 billion, what is the bank's equity?
A. ₦1.8 billion
B. ₦2.2 billion
Correct C. ₦2.5 billion
D. ₦3.0 billion

Correct Answer: C

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Question 23
A country's foreign trade balance is calculated by subtracting its imports from its exports. If the country's imports are ₦2.5 billion and its exports are ₦4.8 billion, what is the country's trade balance?
A. ₦2.3 billion
B. ₦2.5 billion
Correct C. ₦4.3 billion
D. ₦6.3 billion

Correct Answer: C

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Question 24
A company's insurance policy covers losses due to fire, theft, and natural disasters. If the company's annual premium is ₦1.5 million and it experiences a loss of ₦2.8 million due to a fire, what is the company's deductible?
A. ₦500,000
B. ₦750,000
Correct C. ₦1.0 million
D. ₦1.2 million

Correct Answer: C

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Question 25
A country's GDP is calculated by adding its consumption, investment, government spending, and net exports. If the country's consumption is ₦3.2 billion, its investment is ₦2.1 billion, its government spending is ₦1.9 billion, and its net exports are ₦1.5 billion, what is the country's GDP?
A. ₦9.7 billion
B. ₦10.2 billion
Correct C. ₦10.7 billion
D. ₦11.2 billion

Correct Answer: C

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