POST UTME ESUT 2021 Commerce | Objective

Are you preparing for POST UTME ESUT 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.

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Question 1
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 2
A company has a production function given by Q = 2L^0.5K^0.5. If the price of labor (L) is ₦100 per unit and the price of capital (K) is ₦200 per unit, and the company wants to maximize its profit, what is the optimal level of labor (L) and capital (K)?
Correct A. L = 100, K = 50
B. L = 50, K = 100
C. L = 200, K = 100
D. L = 100, K = 200

Correct Answer: A

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Question 3
A consumer has a utility function given by U = 2x^2 + 3y^2, where x and y are the quantities of two different goods. If the price of good x is ₦50 per unit and the price of good y is ₦100 per unit, and the consumer's income is ₦1000, what is the optimal bundle of goods (x, y) that maximizes the consumer's utility?
Correct A. x = 10, y = 5
B. x = 5, y = 10
C. x = 20, y = 0
D. x = 0, y = 20

Correct Answer: A

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Question 4
A firm has a production function given by Q = 2L^0.5K^0.5. If the price of labor (L) is ₦100 per unit and the price of capital (K) is ₦200 per unit, and the firm wants to minimize its cost, what is the optimal level of labor (L) and capital (K)?
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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Question 5
A consumer has a budget constraint given by 2x + 3y = 1000, where x and y are the quantities of two different goods. If the price of good x is ₦50 per unit and the price of good y is ₦100 per unit, what is the optimal bundle of goods (x, y) that maximizes the consumer's utility?
A. x = 10, y = 5
Correct B. x = 5, y = 10
C. x = 20, y = 0
D. x = 0, y = 20

Correct Answer: B

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Question 6
The concept of 'market segmentation' in marketing refers to the process of dividing a market into distinct groups of consumers with similar needs, preferences, or behaviors. Which of the following is NOT a common method of market segmentation?
A. Demographic segmentation
B. Geographic segmentation
C. Psychographic segmentation
Correct D. Product-based segmentation

Correct Answer: D

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Question 7
A company is considering exporting its products to a foreign market. Which of the following is a key advantage of exporting?
A. Increased competition
B. Reduced market share
Correct C. Access to new customers
D. Lower production costs

Correct Answer: C

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Question 8
A consumer is considering purchasing a product online. Which of the following is a key factor in their decision-making process?
A. Price
B. Quality
Correct C. Convenience
D. Brand reputation

Correct Answer: C

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Question 9
A company is considering entering into a contract with a supplier. Which of the following is a key provision that the company should include in the contract?
A. Payment terms
B. Delivery schedule
Correct C. Warranty and liability
D. Termination clause

Correct Answer: C

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Question 10
A consumer is considering filing a complaint against a company for a defective product. Which of the following is a key step in the complaint process?
Correct A. Contacting the company's customer service department
B. Filing a lawsuit
C. Seeking mediation
D. Posting a negative review online

Correct Answer: A

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Question 11
In a perfectly competitive market, the supply curve is downward sloping because of the law of increasing marginal opportunity cost. What is the primary reason for this downward slope?
A. The law of diminishing marginal returns
Correct B. The law of increasing marginal opportunity cost
C. The law of supply and demand
D. The law of diminishing marginal utility

Correct Answer: B

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Question 12
A firm's production function is given by Q = 2L^(1/2)K^(1/2). If the firm's current input levels are L = 16 and K = 9, what is the marginal product of labor?
A. 1/4
Correct B. 1/2
C. 1
D. 2

Correct Answer: B

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Question 13
A company's cash flow statement shows a net income of ₦1,000,000, depreciation of ₦200,000, and a change in working capital of ₦300,000. What is the company's operating cash flow?
Correct A. ₦1,200,000
B. ₦1,500,000
C. ₦2,000,000
D. ₦2,500,000

Correct Answer: A

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Question 14
A firm's demand function is given by Q = 100 - 2P. If the firm's current price is P = 20, what is the firm's consumer surplus?
A. ₦1,000
Correct B. ₦2,000
C. ₦3,000
D. ₦4,000

Correct Answer: B

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Question 15
A company's production function is given by Q = 2L^(1/2)K^(1/2). If the firm's current input levels are L = 25 and K = 16, what is the marginal product of capital?
A. 1/4
B. 1/2
C. 1
Correct D. 2

Correct Answer: D

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Question 16
The concept of risk management in commerce involves identifying, assessing, and mitigating potential losses. Which of the following is a key characteristic of a risk management strategy?
A. It involves transferring risk to a third party.
B. It involves diversifying investments to reduce risk.
Correct C. It involves identifying and assessing potential losses.
D. It involves ignoring potential losses.

Correct Answer: C

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Question 17
A company is considering exporting its products to a foreign market. Which of the following is a key factor to consider when determining the feasibility of this decision?
A. The company's production costs.
Correct B. The demand for the product in the foreign market.
C. The company's marketing strategy.
D. The company's financial resources.

Correct Answer: B

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Question 18
A sole trader is considering expanding its business by hiring additional staff. Which of the following is a key advantage of this decision?
A. Increased profits.
B. Improved customer service.
Correct C. Reduced workload for the owner.
D. Increased risk of business failure.

Correct Answer: C

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Question 19
A company is considering investing in a new transport system. Which of the following is a key factor to consider when determining the feasibility of this decision?
A. The cost of the new system.
Correct B. The potential return on investment.
C. The impact on the environment.
D. The impact on the company's reputation.

Correct Answer: B

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Question 20
A company is considering importing goods from a foreign supplier. Which of the following is a key factor to consider when determining the feasibility of this decision?
A. The cost of the goods.
Correct B. The quality of the goods.
C. The availability of the goods.
D. The impact on the company's reputation.

Correct Answer: B

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Question 21
A firm specializes in producing a single product, which is a type of commodity. The production process involves a series of stages, each with its own set of inputs and outputs. If the firm's production function is given by the equation ( Q = 2L^2 + 5K ), where Q is the quantity produced, L is the labor input, and K is the capital input, what is the marginal product of labor (MPL) when L = 4 and K = 3?
Correct A. 8
B. 12
C. 16
D. 20

Correct Answer: A

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Question 22
A company's inventory management system uses a first-in, first-out (FIFO) method to track its stock levels. If the company has 100 units of a product in stock, and 20 units are sold, what is the new stock level?
Correct A. 80
B. 90
C. 100
D. 120

Correct Answer: A

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Question 23
A sole trader has a business income of ₦500,000 and expenses of ₦200,000. What is the net profit?
Correct A. ₦300,000
B. ₦400,000
C. ₦500,000
D. ₦600,000

Correct Answer: A

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Question 24
A company uses a just-in-time (JIT) inventory system to manage its stock levels. If the company has a daily demand of 50 units of a product, and it wants to maintain a safety stock of 10 units, what is the reorder point?
A. 40
Correct B. 50
C. 60
D. 70

Correct Answer: B

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Question 25
A firm is considering investing in a new project that has a net present value (NPV) of ₦1,000,000. If the firm's cost of capital is 10%, what is the internal rate of return (IRR) of the project?
Correct A. 10%
B. 12%
C. 15%
D. 18%

Correct Answer: A

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