Practice Post UTME IMS U commerce 2023 Past Questions

Question 1

A company is considering two investment options: Option A, which has a 5% annual return, and Option B, which has a 7% annual return. If the company invests ₦100,000 in each option, how much more money will it have after 5 years if it chooses Option B?

A. ₦122,976

B. ₦130,000

Correct C. ₦132,976

D. ₦140,000

Correct Answer: C

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Question 2

A firm is considering two marketing strategies: Strategy A, which involves a 10% increase in advertising expenditure, and Strategy B, which involves a 5% decrease in advertising expenditure. If the firm currently spends ₦500,000 on advertising, how much will it spend on advertising if it chooses Strategy B?

A. ₦475,000

Correct B. ₦475,000

C. ₦475,000

D. ₦475,000

Correct Answer: B

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Question 3

A sole trader has a business income of ₦500,000 and business expenses of ₦200,000. What is the sole trader's business profit?

Correct A. ₦300,000

B. ₦300,000

C. ₦300,000

D. ₦300,000

Correct Answer: A

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Question 4

A company is considering two export options: Option A, which involves exporting goods to a country with a 10% tariff, and Option B, which involves exporting goods to a country with a 5% tariff. If the company exports goods worth ₦100,000, how much more money will it lose if it chooses Option A?

Correct A. ₦10,000

B. ₦5,000

C. ₦10,000

D. ₦5,000

Correct Answer: A

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Question 5

A firm is considering two import options: Option A, which involves importing goods from a country with a 10% tariff, and Option B, which involves importing goods from a country with a 5% tariff. If the firm imports goods worth ₦100,000, how much more money will it pay if it chooses Option A?

Correct A. ₦10,000

B. ₦5,000

C. ₦10,000

D. ₦5,000

Correct Answer: A

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Question 6

A company is considering the purchase of a new machine that will cost ₦5,000,000. The machine is expected to last for 5 years and will save the company ₦1,200,000 per year in labor costs. However, the machine will also require an annual maintenance cost of ₦300,000. What is the net present value (NPV) of the machine, assuming a discount rate of 10%?

Correct A. ₦2,500,000

B. ₦3,500,000

C. ₦4,500,000

D. ₦5,500,000

Correct Answer: A

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Question 7

A consumer protection agency has received a complaint about a company that is selling a product with a misleading label. The label claims that the product is '100% natural' when, in fact, it contains 20% artificial ingredients. What is the legal consequence of this action, assuming the company is based in Nigeria?

A. The company will be fined ₦1,000,000

B. The company will be required to recall the product

Correct C. The company will be sued for damages

D. The company will be shut down

Correct Answer: C

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Question 8

A sole trader is considering the purchase of a new business. The business will require an initial investment of ₦2,000,000 and is expected to generate a profit of ₦500,000 per year for 5 years. What is the internal rate of return (IRR) of the investment, assuming a discount rate of 12%?

A. 12%

Correct B. 15%

C. 18%

D. 20%

Correct Answer: B

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Question 9

A company is considering the implementation of a new marketing strategy. The strategy involves creating a social media campaign that will target a specific demographic. What is the primary goal of this campaign, assuming the company is looking to increase sales?

A. To increase brand awareness

B. To generate leads

C. To drive website traffic

Correct D. To increase sales

Correct Answer: D

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Question 10

A company is considering the purchase of a new vehicle for its fleet. The vehicle will cost ₦10,000,000 and is expected to last for 5 years. What is the total cost of ownership (TCO) of the vehicle, assuming a fuel efficiency of 10 km/l and an annual fuel cost of ₦1,500,000?

A. ₦15,000,000

B. ₦20,000,000

Correct C. ₦25,000,000

D. ₦30,000,000

Correct Answer: C

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Question 11

A firm specializes in producing a single product. This specialization leads to economies of scale, which can result in lower costs per unit. However, it also limits the firm's ability to respond to changes in market demand. What is the primary advantage of specialization in production?

A. Increased flexibility in responding to market changes

Correct B. Lower costs per unit due to economies of scale

C. Improved product quality

D. Increased market share

Correct Answer: B

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Question 12

A company is considering two different transportation modes to move its products from the factory to the warehouse. Mode A involves using a truck, while Mode B involves using a train. If the company expects to move 500 units per day, and the cost of using a truck is ₦150 per unit, while the cost of using a train is ₦120 per unit, what is the total cost of using Mode A for 30 days?

Correct A. ₦22,500

B. ₦30,000

C. ₦37,500

D. ₦45,000

Correct Answer: A

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Question 13

A firm is considering two different insurance policies to protect its assets. Policy A has a premium of ₦10,000 per year, while Policy B has a premium of ₦5,000 per year. However, Policy B has a deductible of ₦20,000. If the firm expects to incur a loss of ₦30,000, what is the total cost of Policy B?

A. ₦25,000

B. ₦30,000

Correct C. ₦35,000

D. ₦40,000

Correct Answer: C

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Question 14

A company is considering two different trade agreements. Agreement A involves a tariff of 10% on imported goods, while Agreement B involves a tariff of 5% on imported goods. If the company expects to import goods worth ₦100,000, what is the total tariff paid under Agreement A?

Correct A. ₦10,000

B. ₦5,000

C. ₦12,500

D. ₦15,000

Correct Answer: A

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Question 15

A firm is considering two different warehousing options. Option A involves a fixed cost of ₦50,000 per year, while Option B involves a fixed cost of ₦30,000 per year. However, Option B has a variable cost of ₦5 per unit stored. If the firm expects to store 10,000 units per year, what is the total cost of Option B?

A. ₦350,000

B. ₦300,000

Correct C. ₦320,000

D. ₦380,000

Correct Answer: C

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Question 16

A company specializes in producing and selling a unique brand of chocolates. The production process involves several stages, including sourcing of raw materials, manufacturing, packaging, and distribution. Which of the following is an example of a cost that would be classified as a fixed cost in the production process?

Correct A. Rent paid for the factory

B. Cost of raw materials used in production

C. Salaries paid to production staff

D. Cost of packaging materials

Correct Answer: A

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Question 17

A consumer protection agency receives a complaint from a customer who claims that a company has sold a defective product. The agency decides to investigate the matter. Which of the following is a key principle of consumer protection law that the agency should apply in this case?

A. The principle of caveat emptor

B. The principle of consumer sovereignty

C. The principle of informed consent

Correct D. The principle of consumer protection

Correct Answer: D

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Question 18

A company is considering setting up a new warehouse to store its products. The company has identified several potential locations for the warehouse. Which of the following is an important factor that the company should consider when evaluating the potential locations?

A. Proximity to the company's manufacturing plant

B. Availability of transportation infrastructure

C. Accessibility to the company's target market

Correct D. All of the above

Correct Answer: D

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Question 19

A sole trader is considering expanding their business by hiring additional staff. Which of the following is an advantage of hiring additional staff?

A. Increased profit margins

B. Improved customer service

C. Reduced workload for the sole trader

Correct D. All of the above

Correct Answer: D

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Question 20

A company is considering entering into a contract with a supplier. The company wants to ensure that the contract is enforceable. Which of the following is a key requirement for a contract to be enforceable?

A. The contract must be in writing

B. The contract must be signed by both parties

C. The contract must be for a legitimate business purpose

Correct D. All of the above

Correct Answer: D

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Question 21

The Central Bank of Nigeria (CBN) uses the following monetary policy tools to control inflation: Open Market Operations (OMO), Reserve Requirements, and Moral Suasion. Which of the following is NOT a primary objective of the CBN's monetary policy?

A. Price stability

Correct B. Full employment

C. Financial stability

D. Economic growth

Correct Answer: B

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Question 22

A firm's production function is given by Q = 2L + 3K, where Q is output, L is labor, and K is capital. If the firm hires 5 units of labor and 3 units of capital, what is the output?

A. 15

B. 20

Correct C. 25

D. 30

Correct Answer: C

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Question 23

A company is considering two marketing strategies: a 10% discount on all products or a free gift with every purchase. Which strategy is more likely to increase sales?

A. Discount

Correct B. Free gift

C. Both are equally effective

D. Neither is effective

Correct Answer: B

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Question 24

A firm's cost function is given by C = 2L + 3K, where C is cost, L is labor, and K is capital. If the firm hires 5 units of labor and 3 units of capital, what is the cost?

A. 15

B. 20

Correct C. 25

D. 30

Correct Answer: C

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Question 25

A country's balance of payments (BOP) is given by BOP = X - M, where X is exports and M is imports. If the country's exports are 100 and imports are 80, what is the BOP?

Correct A. 10

B. 20

C. 30

D. 40

Correct Answer: A

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