Practice Post UTME KSU commerce 2025 Past Questions

Question 1

A firm specializes in producing a single product, and its production function is given by the equation ( Q = 100L^0.5K^0.25 ), where Q is the quantity produced, L is labor, and K is capital. If the firm wants to produce 400 units of the product, and it has 16 units of labor and 25 units of capital, what is the minimum amount of capital it needs to produce 400 units?

A. 10

B. 15

Correct C. 20

D. 25

Correct Answer: C

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Question 2

A consumer protection agency receives a complaint about a company's unfair business practices. The agency's lawyer argues that the company's actions violate the Consumer Protection Act, which states that a company must provide a clear and concise disclosure of all material terms and conditions of a contract. The company's lawyer argues that the disclosure is adequate and that the agency's complaint is frivolous. What is the most likely outcome of this dispute?

A. The agency's complaint is dismissed.

B. The company is ordered to provide additional disclosure.

Correct C. The agency's complaint is upheld, and the company is fined.

D. The dispute is referred to arbitration.

Correct Answer: C

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Question 3

A sole trader wants to expand its business by opening a new branch. The sole trader has the following financial information: initial investment of ₦100,000, monthly expenses of ₦20,000, and projected monthly sales of ₦150,000. What is the minimum amount of capital the sole trader needs to invest in the new branch?

A. ₦50,000

Correct B. ₦75,000

C. ₦100,000

D. ₦125,000

Correct Answer: B

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Question 4

A company wants to import goods from a foreign country. The company has the following information: the cost of the goods is 10,000, the shipping cost is 2,000, and the customs duty is 10% of the cost of the goods. What is the total cost of importing the goods?

A. 12,000

B. 12,500

Correct C. 13,000

D. 13,500

Correct Answer: C

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Question 5

A firm wants to produce a new product using a combination of labor and capital. The production function is given by the equation ( Q = 2L^0.5K^0.25 ), where Q is the quantity produced, L is labor, and K is capital. If the firm wants to produce 16 units of the product, and it has 4 units of labor and 9 units of capital, what is the minimum amount of capital it needs to produce 16 units?

A. 3

B. 4

Correct C. 5

D. 6

Correct Answer: C

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Question 6

A company's financial statements are prepared using the accrual accounting method. Which of the following accounts would be affected by the accrual accounting method?

A. Accounts Payable

Correct B. Accounts Receivable

C. Salaries Expense

D. Rent Expense

Correct Answer: B

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Question 7

A sole trader's business is affected by the following factors: market conditions, government policies, and consumer behavior. Which of the following is NOT a factor that affects a sole trader's business?

A. Market conditions

B. Government policies

C. Consumer behavior

Correct D. Weather conditions

Correct Answer: D

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Question 8

A company issues 1,000 shares of common stock at a price of ₦50 per share. If the company has a total of 5,000 shares outstanding, what is the total amount of cash received from the issuance of common stock?

A. ₦250,000

Correct B. ₦500,000

C. ₦750,000

D. ₦1,000,000

Correct Answer: B

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Question 9

A company's financial statements are prepared using the accrual accounting method. Which of the following accounts would be affected by the accrual accounting method?

A. Accounts Payable

Correct B. Accounts Receivable

C. Salaries Expense

D. Rent Expense

Correct Answer: B

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Question 10

A sole trader's business is affected by the following factors: market conditions, government policies, and consumer behavior. Which of the following is NOT a factor that affects a sole trader's business?

A. Market conditions

B. Government policies

C. Consumer behavior

Correct D. Weather conditions

Correct Answer: D

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Question 11

A company uses the Economic Order Quantity (EOQ) model to determine its optimal inventory level. The EOQ model is given by the formula: EOQ = √(2DS/C), where D is the annual demand, S is the ordering cost, and C is the holding cost. If the annual demand is 10,000 units, the ordering cost is ₦500, and the holding cost is ₦20 per unit, what is the optimal inventory level?

A. 1,000 units

B. 2,000 units

Correct C. 5,000 units

D. 10,000 units

Correct Answer: C

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Question 12

A firm's marketing strategy involves a mix of advertising and personal selling. If the advertising budget is ₦1,000,000 and the personal selling budget is ₦500,000, what is the total marketing budget?

Correct A. ₦1,500,000

B. ₦2,000,000

C. ₦2,500,000

D. ₦3,000,000

Correct Answer: A

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Question 13

A bank's cash management system involves the use of a cash forecasting model. The model is given by the formula: CF = (TR + ΔA - ΔC - ΔI) / (1 + r), where CF is the cash forecast, TR is the total revenue, ΔA is the change in accounts receivable, ΔC is the change in accounts payable, ΔI is the change in inventory, and r is the interest rate. If the total revenue is ₦10,000,000, the change in accounts receivable is ₦500,000, the change in accounts payable is ₦200,000, the change in inventory is ₦300,000, and the interest rate is 10%, what is the cash forecast?

A. ₦9,500,000

Correct B. ₦10,000,000

C. ₦10,500,000

D. ₦11,000,000

Correct Answer: B

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Question 14

A firm's insurance policy covers the risk of damage to its property. The policy has a deductible of ₦50,000 and a maximum payout of ₦500,000. If the actual damage is ₦200,000, what is the insurance payout?

A. ₦0

B. ₦50,000

Correct C. ₦150,000

D. ₦200,000

Correct Answer: C

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Question 15

A company's transportation costs are given by the formula: TC = (Q x C) + (Q x D), where Q is the quantity transported, C is the cost per unit, and D is the distance traveled. If the quantity transported is 10,000 units, the cost per unit is ₦50, and the distance traveled is 500 km, what is the total transportation cost?

A. ₦500,000

B. ₦750,000

Correct C. ₦1,000,000

D. ₦1,250,000

Correct Answer: C

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Question 16

A company's marketing strategy involves creating a sense of urgency among potential customers to increase sales. This tactic is an example of which of the following?

Correct A. Scarcity principle

B. Loss aversion principle

C. Endowment effect principle

D. Anchoring effect principle

Correct Answer: A

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Question 17

A firm's warehousing and stock control system involves the use of a first-in-first-out (FIFO) inventory management method. What is the primary advantage of this method?

A. Reduced storage costs

Correct B. Improved inventory turnover

C. Enhanced customer satisfaction

D. Increased product quality

Correct Answer: B

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Question 18

A consumer protection agency receives a complaint from a customer who was sold a defective product. The agency's primary responsibility is to?

Correct A. Investigate the complaint and take action against the seller

B. Provide compensation to the customer

C. Educate the customer on consumer rights

D. Refer the complaint to a higher authority

Correct Answer: A

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Question 19

A company's home and foreign trade activities involve the export of goods to a foreign country. What is the primary benefit of this activity?

Correct A. Increased revenue

B. Improved market share

C. Enhanced brand reputation

D. Reduced production costs

Correct Answer: A

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Question 20

A firm's marketing strategy involves the use of social media platforms to promote its products. What is the primary advantage of this approach?

A. Increased brand awareness

Correct B. Improved customer engagement

C. Enhanced product visibility

D. Reduced marketing costs

Correct Answer: B

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Question 21

A company is considering two different insurance policies to cover its warehouse. Policy A has a premium of ₦120,000 and a deductible of ₦50,000. Policy B has a premium of ₦150,000 and a deductible of ₦20,000. If the company expects to incur an average loss of ₦80,000 per year, which policy should it choose?

Correct A. Policy A

B. Policy B

C. Policy A and B

D. Neither Policy A nor B

Correct Answer: A

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Question 22

A firm is considering exporting its products to a foreign market. The firm has estimated the following costs associated with exporting: transportation costs of ₦100,000, insurance costs of ₦50,000, and marketing costs of ₦200,000. If the firm expects to earn a profit of ₦500,000 from the export, what is the minimum price it should charge for its product?

Correct A. ₦1,250,000

B. ₦1,500,000

C. ₦1,750,000

D. ₦2,000,000

Correct Answer: A

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Question 23

A sole trader has the following assets: cash of ₦500,000, accounts receivable of ₦200,000, inventory of ₦300,000, and property of ₦1,000,000. If the sole trader's liabilities are ₦800,000, what is the sole trader's net worth?

Correct A. ₦1,200,000

B. ₦1,500,000

C. ₦1,800,000

D. ₦2,000,000

Correct Answer: A

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Question 24

A company has the following financial statements: revenue of ₦5,000,000, cost of goods sold of ₦3,000,000, operating expenses of ₦1,000,000, and net income of ₦1,000,000. If the company's tax rate is 25%, what is the company's net income after taxes?

Correct A. ₦750,000

B. ₦1,000,000

C. ₦1,250,000

D. ₦1,500,000

Correct Answer: A

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Question 25

A bank has the following balance sheet: cash of ₦1,000,000, loans of ₦2,000,000, deposits of ₦3,000,000, and equity of ₦1,500,000. If the bank's reserve requirement is 10%, what is the bank's required reserve?

Correct A. ₦150,000

B. ₦200,000

C. ₦250,000

D. ₦300,000

Correct Answer: A

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