POST UTME COVENANT UNIVERSITY 2018 Commerce | Objective

Practice these randomly selected questions to test your readiness.

Question 1
The concept of 'Gross Domestic Product' (GDP) is a measure of a nation's economic activity, but it has some limitations. Which of the following is NOT a limitation of GDP?
A. It does not account for income inequality
B. It does not account for the value of unpaid household work
C. It does not account for the value of illegal activities
D. It does not account for the value of foreign aid
Question 2
A sole trader's business is registered under the sole trader's name. What is the primary advantage of this type of business registration?
A. Easy to set up and maintain
B. Limited liability protection
C. Flexibility in decision-making
D. No need for formal accounting records
Question 3
A firm's production function is given by Q = 2L^0.5K^0.5. If the price of labor increases by 20%, what is the effect on the firm's output?
A. Output increases by 10%.
B. Output decreases by 10%.
C. Output remains unchanged.
D. Output increases by 20%.
Question 4
A company's marketing strategy involves a mix of advertising, sales promotions, and public relations. Which of the following is a key advantage of using a mix of these strategies?
A. Increased brand awareness
B. Improved customer engagement
C. Enhanced product differentiation
D. Better return on investment
Question 5
A company is considering the use of a new insurance policy to reduce risk and increase financial stability. The company has identified several options, including a liability insurance policy and a business interruption insurance policy. Which of the following is a key feature of a liability insurance policy?
A. Protection against financial loss
B. Protection against physical damage
C. Protection against reputational damage
D. Protection against regulatory fines
Question 6
A firm's profit function is given by Φ = R - C. If the price of the firm's product increases by 15% and the price of labor increases by 10%, what is the effect on the firm's profit?
A. Profit increases by 12.5%.
B. Profit increases by 15%.
C. Profit increases by 17.5%.
D. Profit remains unchanged.
Question 7
A company has a production process that involves the use of a machine that costs ₦200,000 to purchase and ₦50,000 per year to maintain. If the machine is expected to last for 5 years and produce 10,000 units per year, what is the total cost of production for the first year?
A. ₦250,000
B. ₦300,000
C. ₦350,000
D. ₦400,000
Question 8
A bank has a loan portfolio that consists of 80% fixed-rate loans and 20% variable-rate loans. If the average interest rate on the fixed-rate loans is 12% per annum and the average interest rate on the variable-rate loans is 15% per annum, what is the average interest rate on the entire loan portfolio?
A. 12%
B. 13%
C. 14%
D. 15%
Question 9
A firm's marketing mix consists of four Ps: product, price, promotion, and place. Which of the following is NOT one of the four Ps?
A. Product
B. Price
C. Promotion
D. Packaging
Question 10
A company is considering the use of a new warehouse management system to improve inventory control and reduce costs. The company has identified several options, including a just-in-time system and a total inventory management system. Which of the following is a key feature of a just-in-time system?
A. Inventory reduction
B. Cost reduction
C. Improved forecasting
D. Increased flexibility
Question 11
A consumer protection agency has been established to regulate the activities of a company that has been accused of unfair business practices. The agency has the power to investigate the company's activities and impose penalties if necessary. Which of the following is a key feature of this agency?
A. Regulatory power
B. Investigative power
C. Penal power
D. Educational power
Question 12
A company is considering the purchase of a new machine that costs ₦1,500,000. The machine is expected to last for 5 years and reduce production costs by ₦200,000 per year. If the company's cost of capital is 12% per annum, what is the net present value (NPV) of the machine?
A. ₦750,000
B. ₦1,000,000
C. ₦1,200,000
D. ₦1,500,000
Question 13
A consumer protection agency has received a complaint from a customer who was sold a defective product. The product was sold for ₦50,000, and the customer is seeking a refund. If the product's market value is ₦30,000, what is the amount of compensation the customer is entitled to?
A. ₦10,000
B. ₦20,000
C. ₦30,000
D. ₦40,000
Question 14
A business is considering the purchase of a new machine to increase production capacity. What is the primary factor to consider when evaluating the cost-benefit analysis?
A. Initial purchase price and maintenance costs
B. Expected lifespan and residual value
C. Opportunity costs and alternative uses
D. Market demand and competition
Question 15
A firm's revenue function is given by R = 100P^2. If the price of the firm's product increases by 20%, what is the effect on the firm's revenue?
A. Revenue increases by 10%.
B. Revenue increases by 20%.
C. Revenue increases by 40%.
D. Revenue remains unchanged.

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