POST UTME IMS U 2018 Commerce | Objective

Are you preparing for POST UTME IMS U exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2018 Commerce (Objective) questions designed to simulate the real exam environment.

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Question 1
A sole trader's business is registered under which of the following?
A. Partnership
B. Limited Liability Company
Correct C. Sole Proprietorship
D. Cooperative Society

Correct Answer: C

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Question 2
A company's articles of association can be amended by a majority vote of the shareholders at a general meeting. What is the primary purpose of this amendment?
A. To increase the company's capital
B. To change the company's name
Correct C. To alter the company's objects
D. To remove a director

Correct Answer: C

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Question 3
A producer specializes in the production of a single product. What is the primary advantage of this specialization?
Correct A. Increased efficiency
B. Reduced costs
C. Improved quality
D. Increased market share

Correct Answer: A

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Question 4
A company uses a just-in-time inventory system. What is the primary benefit of this system?
A. Reduced inventory costs
B. Improved customer service
Correct C. Increased efficiency
D. Enhanced product quality

Correct Answer: C

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Question 5
A company uses a market segmentation strategy to target a specific group of customers. What is the primary benefit of this strategy?
Correct A. Increased market share
B. Improved customer service
C. Enhanced product quality
D. Reduced marketing costs

Correct Answer: A

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Question 6
In a sole trader business, what is the primary advantage of using a sole proprietorship structure?
A. Limited liability
B. Easy to set up
Correct C. Flexibility in decision-making
D. No tax benefits

Correct Answer: C

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Question 7
A company has a share capital of ₦1,000,000, divided into 100,000 ordinary shares of ₦10 each. If the company issues 20,000 shares at a premium of ₦5 per share, what is the total amount received from the issue of shares?
A. ₦200,000
Correct B. ₦250,000
C. ₦300,000
D. ₦350,000

Correct Answer: B

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Question 8
A consumer protection law requires that all goods sold in a market must be accompanied by a warranty. Which of the following is a type of warranty?
Correct A. Express warranty
B. Implied warranty
C. Statutory warranty
D. Consequential warranty

Correct Answer: A

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Question 9
A business has a turnover of ₦500,000 and a profit of ₦100,000. What is the profit margin?
A. 20%
Correct B. 25%
C. 30%
D. 35%

Correct Answer: B

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Question 10
A company has a capital structure consisting of 70% equity and 30% debt. If the company's cost of equity is 12% and the cost of debt is 6%, what is the weighted average cost of capital (WACC)?
A. 8%
Correct B. 9%
C. 10%
D. 11%

Correct Answer: B

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Question 11
A sole trader's business is registered under which of the following?
A. Partnership
B. Limited Liability Company
Correct C. Sole Trader
D. Cooperative Society

Correct Answer: C

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Question 12
A company's articles of association is a document that outlines the?
A. Objectives of the company
Correct B. Rights and duties of shareholders
C. Rights and duties of directors
D. Rights and duties of employees

Correct Answer: B

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Question 13
A warehouse manager wants to store 500 boxes of goods in a warehouse with a capacity of 2000 boxes. The goods are packed in boxes of 10 kg each. If the warehouse has a maximum weight capacity of 1000 kg, how many boxes can be stored?
A. 50
Correct B. 75
C. 100
D. 125

Correct Answer: B

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Question 14
A consumer protection agency receives a complaint from a customer who was sold a defective product. The agency wants to investigate the matter further. Which of the following is the best course of action?
A. Send a letter to the customer asking for more information
B. Visit the customer's home to inspect the product
Correct C. Contact the manufacturer to request a replacement or refund
D. File a lawsuit against the seller

Correct Answer: C

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Question 15
A bank wants to offer a loan to a customer who has a credit score of 600. The bank's lending policy requires a minimum credit score of 700. What is the best course of action?
A. Approve the loan
Correct B. Deny the loan
C. Request additional information from the customer
D. Offer a higher interest rate

Correct Answer: B

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Question 16
A company specializes in producing high-quality leather goods. It has two production lines: one for shoes and the other for handbags. The company uses a just-in-time inventory system to manage its inventory. If the demand for shoes increases by 20% and the demand for handbags decreases by 15%, what is the expected change in the company's total production volume?
Correct A. 10% increase
B. 5% decrease
C. 15% increase
D. 20% decrease

Correct Answer: A

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Question 17
A firm uses a warehouse management system to track its inventory levels. The system uses a first-in-first-out (FIFO) inventory method. If the firm receives a new shipment of goods, what is the expected impact on the inventory levels of the existing goods?
A. Inventory levels will decrease
Correct B. Inventory levels will increase
C. Inventory levels will remain the same
D. Inventory levels will fluctuate

Correct Answer: B

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Question 18
A logistics company uses a transportation management system to optimize its delivery routes. The system uses a vehicle routing algorithm to minimize fuel consumption and reduce emissions. If the company adds a new delivery route, what is the expected impact on the overall fuel consumption?
A. Fuel consumption will increase
Correct B. Fuel consumption will decrease
C. Fuel consumption will remain the same
D. Fuel consumption will fluctuate

Correct Answer: B

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Question 19
A firm uses an insurance policy to mitigate its risks. The policy covers losses due to natural disasters. If the firm experiences a loss due to a natural disaster, what is the expected impact on its financial statements?
Correct A. Financial statements will show a loss
B. Financial statements will show a gain
C. Financial statements will remain unchanged
D. Financial statements will fluctuate

Correct Answer: A

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Question 20
A company operates as a sole proprietorship. The owner has unlimited personal liability for the business's debts. If the company incurs a debt, what is the expected impact on the owner's personal assets?
A. Personal assets will increase
Correct B. Personal assets will decrease
C. Personal assets will remain unchanged
D. Personal assets will fluctuate

Correct Answer: B

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Question 21
The concept of comparative advantage in international trade is based on the idea that countries should specialize in producing goods for which they have a lower opportunity cost. Which of the following statements best describes the opportunity cost of producing a good?
Correct A. The amount of another good that could be produced with the same resources
B. The amount of labor required to produce the good
C. The amount of capital required to produce the good
D. The amount of time required to produce the good

Correct Answer: A

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Question 22
A firm's production function is given by Q = 2L^0.5K^0.5, where Q is the quantity produced, L is labor, and K is capital. If the firm wants to produce 100 units of output, how much labor should it hire if it has 16 units of capital?
A. 8
Correct B. 16
C. 32
D. 64

Correct Answer: B

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Question 23
A consumer's budget constraint is given by P1X1 + P2X2 = I, where P1 and P2 are the prices of two goods, X1 and X2 are the quantities consumed, and I is the consumer's income. If the consumer's income is ₦1000, and the prices of the two goods are ₦10 and ₦20 respectively, how much of good 2 should the consumer buy if they want to buy 10 units of good 1?
A. 5
B. 10
Correct C. 15
D. 20

Correct Answer: C

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Question 24
A firm's demand function is given by Q = 100 - 2P, where Q is the quantity demanded and P is the price. If the firm wants to maximize its revenue, what price should it charge?
A. 20
Correct B. 30
C. 40
D. 50

Correct Answer: B

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Question 25
A consumer's indifference curve is given by U = 2X1 + 3X2, where U is the utility and X1 and X2 are the quantities consumed. If the consumer's income is ₦1000, and the prices of the two goods are ₦10 and ₦20 respectively, how much of good 2 should the consumer buy if they want to maximize their utility?
A. 5
B. 10
Correct C. 15
D. 20

Correct Answer: C

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