POST UTME COVENANT UNIVERSITY 2019 Commerce | Objective

Are you preparing for POST UTME COVENANT UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2019 Commerce (Objective) questions designed to simulate the real exam environment.

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Question 1
A firm specializes in producing a single product, which is a type of commodity. The production process involves a series of complex steps, including raw material extraction, processing, and manufacturing. What is the primary advantage of specialization in this context?
Correct A. Increased efficiency
B. Reduced production costs
C. Improved product quality
D. Enhanced market competition

Correct Answer: A

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Question 2
A company uses a combination of online and offline marketing strategies to promote its products. Which of the following is an example of an offline marketing strategy?
A. Social media advertising
B. Influencer marketing
Correct C. Trade show participation
D. Email marketing

Correct Answer: C

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Question 3
A logistics company uses a transportation management system to optimize its delivery routes. What is the primary benefit of using this system?
Correct A. Reduced transportation costs
B. Improved delivery times
C. Enhanced customer satisfaction
D. Increased fuel efficiency

Correct Answer: A

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Question 4
A warehouse manager is responsible for maintaining a high level of inventory accuracy. What is the primary method used to achieve this?
Correct A. Cycle counting
B. Physical inventory counts
C. Barcode scanning
D. Inventory management software

Correct Answer: A

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Question 5
A business owner is considering purchasing insurance to protect against potential losses. What is the primary benefit of purchasing insurance?
Correct A. Reduced financial risk
B. Increased business revenue
C. Improved employee morale
D. Enhanced market competitiveness

Correct Answer: A

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Question 6
In a perfectly competitive market, the supply curve is horizontal and the demand curve is downward-sloping. What is the equilibrium price and quantity in this market?
A. ₦100, 100 units
Correct B. ₦120, 80 units
C. ₦150, 60 units
D. ₦180, 40 units

Correct Answer: B

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Question 7
A company's financial statements show a net income of ₦500,000 and a total assets of ₦2,000,000. What is the company's return on assets (ROA)?
A. 0.25
Correct B. 0.30
C. 0.35
D. 0.40

Correct Answer: B

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Question 8
A firm is considering two investment projects. Project A has a net present value (NPV) of ₦100,000 and a payback period of 5 years. Project B has a NPV of ₦120,000 and a payback period of 4 years. Which project should the firm choose?
A. Project A
Correct B. Project B
C. Both projects are equally good
D. Neither project is good

Correct Answer: B

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Question 9
A company's marketing strategy involves a 10% discount on all products. If the original price of a product is ₦1,000, what is the new price after the discount?
Correct A. ₦900
B. ₦950
C. ₦1,000
D. ₦1,050

Correct Answer: A

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Question 10
A firm is considering a new product launch. The product has a fixed cost of ₦500,000 and a variable cost of ₦200 per unit. If the selling price is ₦300 per unit, what is the break-even point?
A. 2,500 units
Correct B. 5,000 units
C. 7,500 units
D. 10,000 units

Correct Answer: B

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Question 11
A company's sole trader is considering expanding its operations to a new market. The company's current profit is ₦1,500,000, and it expects to increase its profit by 20% in the new market. However, the company will also incur additional costs of ₦300,000. What is the expected profit of the company in the new market?
A. ₦1,800,000
B. ₦1,900,000
Correct C. ₦2,100,000
D. ₦2,200,000

Correct Answer: C

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Question 12
A consumer protection agency has received a complaint about a company's advertising practices. The company has been accused of making false claims about its product's benefits. Which of the following is a legal requirement for advertising in Nigeria?
A. The company must provide evidence to support its claims
B. The company must disclose any potential conflicts of interest
C. The company must obtain prior approval from the consumer protection agency
Correct D. The company must comply with the Advertising Standards Authority of Nigeria (ASAN) code

Correct Answer: D

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Question 13
A sole trader has a business that specializes in producing and selling handmade crafts. The business has a fixed cost of ₦50,000 per month and a variable cost of ₦10 per unit sold. The selling price of each unit is ₦20. What is the break-even point for the business?
A. 100 units
Correct B. 200 units
C. 500 units
D. 1000 units

Correct Answer: B

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Question 14
A company is considering entering into a contract with a supplier. The contract includes a clause that requires the company to pay a penalty of ₦100,000 if it fails to meet its delivery deadline. What type of contract is this?
A. Fixed-price contract
B. Cost-plus contract
Correct C. Penalty contract
D. Time-and-materials contract

Correct Answer: C

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Question 15
A marketing manager is developing a campaign to promote a new product. The campaign includes a social media advertising strategy that targets a specific demographic. What type of marketing strategy is this?
A. Segmented marketing
Correct B. Targeted marketing
C. Mass marketing
D. Positioning marketing

Correct Answer: B

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Question 16
A company's marketing strategy involves creating a sense of urgency among its customers. This is an example of which of the following marketing tactics?
Correct A. Scarcity
B. Exclusivity
C. Social Proof
D. Authority

Correct Answer: A

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Question 17
A firm's warehouse is designed to store goods in a way that minimizes the risk of damage. This is an example of which of the following warehousing strategies?
Correct A. First-In-First-Out (FIFO)
B. Last-In-First-Out (LIFO)
C. Just-In-Time (JIT)
D. Cross-Docking

Correct Answer: A

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Question 18
A consumer protection law requires businesses to provide clear and accurate information about their products. This is an example of which of the following consumer protection measures?
Correct A. Labeling
B. Packaging
C. Advertising
D. Warranty

Correct Answer: A

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Question 19
A company's marketing strategy involves creating a sense of exclusivity among its customers. This is an example of which of the following marketing tactics?
A. Scarcity
Correct B. Exclusivity
C. Social Proof
D. Authority

Correct Answer: B

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Question 20
A firm's warehouse is designed to store goods in a way that minimizes the risk of damage. This is an example of which of the following warehousing strategies?
Correct A. First-In-First-Out (FIFO)
B. Last-In-First-Out (LIFO)
C. Just-In-Time (JIT)
D. Cross-Docking

Correct Answer: A

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Question 21
In a perfectly competitive market, the law of supply states that as the price of a commodity increases, the quantity supplied will
A. decrease
Correct B. increase
C. remain constant
D. fluctuate

Correct Answer: B

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Question 22
A firm's revenue is calculated by multiplying the price per unit by the number of units sold. If a firm sells 100 units at 10 per unit, its revenue is
A. 1000
Correct B. 10000
C. 5000
D. 2000

Correct Answer: B

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Question 23
A firm's cost of production includes both fixed and variable costs. If a firm has a fixed cost of 1000 and a variable cost of 5 per unit, and it produces 200 units, its total cost is
A. 1500
Correct B. 2500
C. 3000
D. 4000

Correct Answer: B

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Question 24
A firm's profit is calculated by subtracting its total cost from its total revenue. If a firm has a total revenue of 10000 and a total cost of 5000, its profit is
Correct A. 5000
B. 10000
C. 15000
D. 20000

Correct Answer: A

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Question 25
A firm's break-even point is the point at which its total revenue equals its total cost. If a firm has a fixed cost of 1000 and a variable cost of 5 per unit, and it produces x units, its break-even point is
A. x = 100
Correct B. x = 200
C. x = 300
D. x = 400

Correct Answer: B

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