POST UTME COVENANT UNIVERSITY 2024 Commerce | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A bank's balance sheet is given by Assets = Liabilities + Equity. If the bank's assets are worth ₦1,000,000, its liabilities are ₦500,000, and its equity is ₦200,000, what is the bank's return on equity (ROE)?
A. 0.20
B. 0.25
C. 0.30
D. 0.35
Question 2
A firm specializes in producing a single product, and its production function is given by Q = 100L^0.5K^0.25. If the firm's current labor and capital inputs are L = 16 and K = 25, respectively, what is the firm's current output level?
A. 400
B. 500
C. 600
D. 700
Question 3
A company has a fleet of 10 vehicles, each with a capacity of 5 tons. If the company is transporting goods that weigh an average of 2 tons per vehicle, what is the total weight of goods being transported?
A. 20 tons
B. 30 tons
C. 40 tons
D. 50 tons
Question 4
A bank has a minimum balance requirement of ₦5,000 for its savings account. If a customer has a balance of ₦3,000, what is the minimum amount the customer must deposit to meet the requirement?
A. ₦2,000
B. ₦2,500
C. ₦3,000
D. ₦3,500
Question 5
A firm is considering the use of a letter of credit to facilitate an international trade transaction. Which of the following is a key benefit of this arrangement?
A. Reduced risk of non-payment
B. Improved cash flow
C. Increased flexibility
D. Enhanced customer service
Question 6
A company's warehouse is experiencing a high rate of stock loss due to inadequate storage facilities. Which of the following warehousing techniques would be most effective in reducing stock loss?
A. First-In-First-Out (FIFO)
B. Last-In-First-Out (LIFO)
C. Just-In-Time (JIT)
D. Economic Order Quantity (EOQ)
Question 7
A firm is considering two different investment options. Option A has a 60% chance of success and will generate a return of ₦100 million if successful. Option B has a 40% chance of success and will generate a return of ₦150 million if successful. What is the expected return on investment for each option?
A. ₦60 million
B. ₦80 million
C. ₦120 million
D. ₦140 million
Question 8
In a perfectly competitive market, the demand curve for a firm's product is its?
A. Supply Curve
B. Demand Curve
C. Marginal Revenue Curve
D. Average Cost Curve
Question 9
A company is considering a new investment opportunity in a foreign market. The investment requires an initial outlay of ₦400 million and is expected to generate a return of 18% per annum. However, there is a 25% chance that the investment will fail and result in a loss of ₦200 million. What is the expected return on investment?
A. ₦72 million
B. ₦90 million
C. ₦108 million
D. ₦126 million
Question 10
A company uses a just-in-time (JIT) inventory system to manage its stock levels. Which of the following is a key benefit of JIT?
A. Reduced inventory costs
B. Improved product quality
C. Increased flexibility
D. Enhanced customer service
Question 11
A consumer is considering purchasing a product with a warranty. Which of the following is a key aspect of the warranty that the consumer should be aware of?
A. Duration of the warranty
B. Scope of the warranty
C. Exclusions from the warranty
D. Cost of the warranty
Question 12
A consumer has a budget of ₦1000 and a preference for two goods, A and B. The prices of the goods are ₦200 and ₦300 respectively. The consumer's indifference curves are given by the equation ( U = 2A + 3B ). Find the consumer's optimal consumption bundle.
A. A = 2, B = 1
B. A = 1, B = 2
C. A = 3, B = 1
D. A = 1, B = 3
Question 13
A firm's production function is given by Q = 2L^0.5K^0.5. If the firm wants to produce 16 units of output, and the wage rate is ₦100 per hour, and the rental rate of capital is ₦200 per hour, what is the minimum cost of production?
A. ₦800
B. ₦1600
C. ₦3200
D. ₦6400
Question 14
A company has a production function given by Q = 2L^0.5K^0.5, where Q is the output, L is the labor input, and K is the capital input. If the company wants to produce 100 units of output, how many units of labor should it hire?
A. 10 units of labor
B. 20 units of labor
C. 30 units of labor
D. 40 units of labor
Question 15
A company is considering two different production processes to manufacture a product. Process A has a fixed cost of ₦100,000 and a variable cost of ₦50 per unit. Process B has a fixed cost of ₦150,000 and a variable cost of ₦30 per unit. If the selling price of the product is ₦80 per unit, which process should the company choose?
A. Process A
B. Process B
C. Both processes are equally profitable
D. Neither process is profitable

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