Practice Post UTME ELIZADE UNIVERSITY commerce 2018 Past Questions

Question 1

In a just-in-time (JIT) inventory system, what is the primary goal of the reorder point (ROP)?

A. To minimize inventory costs

B. To maximize inventory turnover

Correct C. To ensure that stockouts are avoided

D. To optimize the lead time

Correct Answer: C

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Question 2

A bank's return on equity (ROE) is 12%. If the bank's net income is ₦120 million and its total equity is ₦1 billion, what is the bank's return on assets (ROA)?

Correct A. 8%

B. 10%

C. 12%

D. 15%

Correct Answer: A

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Question 3

A consumer protection agency has received a complaint about a company's misleading advertising. The agency's primary goal in investigating the complaint is to determine whether the company has engaged in:

A. Unfair competition

B. Deceptive trade practices

Correct C. False advertising

D. Unfair contract terms

Correct Answer: C

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Question 4

A company has purchased a liability insurance policy with a deductible of ₦50,000. If the company incurs a loss of ₦150,000, what is the company's net loss after deducting the deductible?

Correct A. ₦100,000

B. ₦50,000

C. ₦0

D. ₦150,000

Correct Answer: A

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Question 5

A marketing manager is developing a new product launch campaign. The manager wants to create a sense of urgency among potential customers. Which of the following marketing tactics would be most effective in achieving this goal?

Correct A. Limited-time offer

B. Free trial

C. Discounts

D. Guarantee

Correct Answer: A

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Question 6

In a perfectly competitive market, the law of supply states that as the price of a good increases, the quantity supplied will

A. increase

Correct B. decrease

C. remain constant

D. shift to the left

Correct Answer: B

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Question 7

A firm's production function is given by Q = 2L^0.5K^0.5. If the firm's current labor and capital inputs are 4 and 9 respectively, what is the marginal product of labor?

A. 2

B. 4

Correct C. 6

D. 8

Correct Answer: C

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Question 8

A consumer has a budget of ₦1000 and a utility function given by U = 2x + 3y. If the prices of x and y are ₦5 and ₦10 respectively, what is the consumer's optimal bundle?

A. (20, 10)

Correct B. (40, 5)

C. (60, 0)

D. (0, 100)

Correct Answer: B

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Question 9

A firm is considering two different modes of transportation: road and rail. The cost of transporting a unit of goods by road is ₦50, while the cost of transporting the same unit by rail is ₦30. If the firm can transport 100 units of goods per day, what is the total cost of transportation per day?

A. ₦5000

Correct B. ₦6000

C. ₦7000

D. ₦8000

Correct Answer: B

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Question 10

A country's trade balance is given by the equation TB = X - M, where X is the value of exports and M is the value of imports. If the country's exports are ₦1000 and its imports are ₦800, what is the trade balance?

Correct A. ₦200

B. ₦300

C. ₦400

D. ₦500

Correct Answer: A

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Question 11

A sole trader's business is considered a separate legal entity from its owner. However, the owner's personal assets are not protected in case of business debts. What is the name of this legal concept?

A. Separate Legal Entity

B. Limited Liability

Correct C. Personal Liability

D. Business Continuity

Correct Answer: C

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Question 12

A company's Memorandum of Association is a document that outlines the company's

A. Objectives and Goals

B. Share Capital and Ownership

C. Business Operations and Management

Correct D. All of the above

Correct Answer: D

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Question 13

A consumer protection law that prohibits unfair or deceptive business practices is known as a

A. Consumer Protection Act

B. Fair Trade Act

Correct C. Deceptive Business Practices Act

D. Unfair Competition Act

Correct Answer: C

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Question 14

A bank's primary function is to act as a

Correct A. Financial Intermediary

B. Investment Banker

C. Commercial Banker

D. Central Banker

Correct Answer: A

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Question 15

A risk management strategy that involves transferring risk to another party is known as

A. Risk Retention

Correct B. Risk Transfer

C. Risk Avoidance

D. Risk Mitigation

Correct Answer: B

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Question 16

In a perfectly competitive market, the supply curve is upward-sloping because of the law of increasing marginal opportunity costs. However, in a monopoly, the supply curve is downward-sloping due to the law of diminishing marginal returns. Which of the following best describes the relationship between the two laws?

A. The law of increasing marginal opportunity costs is a result of the law of diminishing marginal returns.

B. The law of diminishing marginal returns is a result of the law of increasing marginal opportunity costs.

Correct C. The law of increasing marginal opportunity costs is a separate concept from the law of diminishing marginal returns.

D. The law of diminishing marginal returns is a result of the law of increasing marginal opportunity costs in the short run, but not in the long run.

Correct Answer: C

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Question 17

A company has a production function given by Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the company wants to produce 100 units of output, and the wage rate is ₦100 per hour, and the rental rate of capital is ₦200 per hour, how many hours of labor should the company hire?

A. 10 hours

Correct B. 20 hours

C. 30 hours

D. 40 hours

Correct Answer: B

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Question 18

A firm has the following probability distribution of possible outcomes: P(X=1) = 0.2, P(X=2) = 0.3, P(X=3) = 0.5. What is the expected value of X?

A. 1.1

Correct B. 1.3

C. 1.5

D. 1.7

Correct Answer: B

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Question 19

A company has a portfolio of assets with the following returns: Asset A has a 20% chance of returning 10%, a 30% chance of returning 20%, and a 50% chance of returning 30%. Asset B has a 20% chance of returning 10%, a 30% chance of returning 20%, and a 50% chance of returning 30%. What is the expected return of the portfolio?

A. 15%

Correct B. 20%

C. 25%

D. 30%

Correct Answer: B

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Question 20

A firm has the following production function: Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the firm wants to produce 100 units of output, and the wage rate is ₦100 per hour, and the rental rate of capital is ₦200 per hour, what is the optimal combination of labor and capital?

A. L = 10, K = 20

B. L = 20, K = 10

Correct C. L = 30, K = 6

D. L = 6, K = 30

Correct Answer: C

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Question 21

A company has a portfolio of assets with the following returns: Asset A has a 20% chance of returning 10%, a 30% chance of returning 20%, and a 50% chance of returning 30%. Asset B has a 20% chance of returning 10%, a 30% chance of returning 20%, and a 50% chance of returning 30%. What is the standard deviation of the portfolio?

A. 5%

B. 10%

Correct C. 15%

D. 20%

Correct Answer: C

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Question 22

A firm has the following production function: Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the firm wants to produce 100 units of output, and the wage rate is ₦100 per hour, and the rental rate of capital is ₦200 per hour, what is the optimal level of labor?

A. 10 hours

Correct B. 20 hours

C. 30 hours

D. 40 hours

Correct Answer: B

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Question 23

A company has a portfolio of assets with the following returns: Asset A has a 20% chance of returning 10%, a 30% chance of returning 20%, and a 50% chance of returning 30%. Asset B has a 20% chance of returning 10%, a 30% chance of returning 20%, and a 50% chance of returning 30%. What is the expected return of the portfolio?

A. 15%

B. 20%

C. 25%

D. 30%

Correct Answer: VIEW ANSWER

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Question 24

In a perfectly competitive market, the supply curve is horizontal and the demand curve is downward-sloping. What is the equilibrium price and quantity of a product 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 25

A company has a production function of Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the price of labor is ₦100 per unit and the price of capital is ₦200 per unit, and the company wants to maximize its profit, what is the optimal level of labor and capital?

A. L = 100, K = 50

Correct B. L = 50, K = 100

C. L = 200, K = 100

D. L = 100, K = 200

Correct Answer: B

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