Practice Post UTME LAUTECH commerce 2022 Past Questions

Question 1

A firm specializes in producing high-quality leather goods. It has a production capacity of 10,000 units per month. The firm sells its products at a price of ₦2,500 per unit. If the fixed costs are ₦150,000 and the variable costs are ₦1,500 per unit, what is the firm's break-even point in units?

A. 5,000 units

Correct B. 6,000 units

C. 7,000 units

D. 8,000 units

Correct Answer: B

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Question 2

A company has two production plants, A and B. Plant A produces 60% of the company's output, and plant B produces the remaining 40%. If the total output is 10,000 units, how many units are produced by plant B?

A. 4,000 units

Correct B. 5,000 units

C. 6,000 units

D. 7,000 units

Correct Answer: B

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Question 3

A firm has a production capacity of 10,000 units per month. The firm sells its products at a price of ₦2,500 per unit. If the fixed costs are ₦150,000 and the variable costs are ₦1,500 per unit, what is the firm's profit per unit?

A. ₦500 per unit

Correct B. ₦750 per unit

C. ₦1,000 per unit

D. ₦1,250 per unit

Correct Answer: B

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Question 4

A company has two production plants, A and B. Plant A produces 60% of the company's output, and plant B produces the remaining 40%. If the total output is 10,000 units, what is the total fixed cost of the company?

Correct A. ₦150,000

B. ₦200,000

C. ₦250,000

D. ₦300,000

Correct Answer: A

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Question 5

A firm has a production capacity of 10,000 units per month. The firm sells its products at a price of ₦2,500 per unit. If the fixed costs are ₦150,000 and the variable costs are ₦1,500 per unit, what is the firm's total revenue per month?

A. ₦25,000,000

Correct B. ₦30,000,000

C. ₦35,000,000

D. ₦40,000,000

Correct Answer: B

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Question 6

A firm specializes in producing a single product, which is a type of commodity. The production process involves a series of sequential stages, each of which adds value to the commodity. The firm's production function can be represented as Q = f(L, K), where Q is the quantity of the commodity produced, L is the labor input, and K is the capital input. If the firm's production function is homogeneous of degree 2, what is the relationship between the marginal product of labor (MPL) and the marginal product of capital (MPK)?

A. MPL = MPK

B. MPL > MPK

Correct C. MPL < MPK

D. MPL = -MPK

Correct Answer: C

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Question 7

A company is considering two different marketing strategies for its new product. Strategy A involves a high level of advertising and promotion, while Strategy B involves a low level of advertising and promotion. The company's marketing manager has estimated the following costs for each strategy: Strategy A: ₦100,000 per month, Strategy B: ₦50,000 per month. If the company's sales revenue is ₦500,000 per month, which strategy should the company choose?

A. Strategy A

Correct B. Strategy B

C. Both strategies are equally profitable

D. Neither strategy is profitable

Correct Answer: B

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Question 8

A firm is considering investing in a new project that has a required rate of return of 12%. The project's expected cash flows are as follows: Year 1: ₦100,000, Year 2: ₦120,000, Year 3: ₦150,000. What is the net present value (NPV) of the project?

A. ₦50,000

B. ₦75,000

Correct C. ₦100,000

D. ₦125,000

Correct Answer: C

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Question 9

A company is considering two different modes of transportation for its goods: road transport and rail transport. The company's logistics manager has estimated the following costs for each mode: Road transport: ₦50 per kilometer, Rail transport: ₦30 per kilometer. If the company's goods need to be transported 100 kilometers, what is the total cost of transportation using each mode?

Correct A. Road transport: ₦5,000, Rail transport: ₦3,000

B. Road transport: ₦3,000, Rail transport: ₦5,000

C. Road transport: ₦4,000, Rail transport: ₦4,000

D. Road transport: ₦6,000, Rail transport: ₦6,000

Correct Answer: A

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Question 10

A firm is considering two different types of insurance policies for its employees: life insurance and health insurance. The firm's HR manager has estimated the following costs for each policy: Life insurance: ₦10,000 per employee per year, Health insurance: ₦5,000 per employee per year. If the firm has 100 employees, what is the total cost of each policy?

Correct A. Life insurance: ₦1,000,000, Health insurance: ₦500,000

B. Life insurance: ₦500,000, Health insurance: ₦1,000,000

C. Life insurance: ₦1,500,000, Health insurance: ₦1,500,000

D. Life insurance: ₦2,000,000, Health insurance: ₦2,000,000

Correct Answer: A

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Question 11

A bank's cash reserve ratio is 20%. If the bank has ₦100 million in cash reserves, what is the total amount of deposits it can make?

A. ₦500 million

B. ₦400 million

C. ₦300 million

Correct D. ₦200 million

Correct Answer: D

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Question 12

A company's stock control system uses a first-in-first-out (FIFO) inventory method. If the company has 100 units of a product with a cost of ₦50 each, and 50 units are sold, what is the total cost of the units sold?

Correct A. ₦2,500

B. ₦2,000

C. ₦1,750

D. ₦1,500

Correct Answer: A

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Question 13

A transport company uses a fleet of 20 trucks to deliver goods. If each truck has a capacity of 10 tons, and the company delivers 200 tons of goods in a day, what is the total number of trips the trucks made?

A. 10 trips

B. 15 trips

Correct C. 20 trips

D. 25 trips

Correct Answer: C

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Question 14

A company's insurance policy has a deductible of ₦10,000. If the company pays ₦50,000 for a claim, and the insurance company pays ₦40,000, what is the total amount the company paid?

A. ₦40,000

Correct B. ₦30,000

C. ₦20,000

D. ₦10,000

Correct Answer: B

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Question 15

A warehouse has a storage capacity of 1,000 square meters. If the warehouse is 50 meters long and 20 meters wide, what is the total height of the warehouse?

A. 10 meters

B. 20 meters

C. 30 meters

Correct D. 40 meters

Correct Answer: D

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Question 16

A company has a warehouse with a capacity to store 5000 units of goods. The warehouse is currently 70% full. If 1500 units of goods are received in a shipment, what is the new percentage of the warehouse that is full?

A. 60%

Correct B. 65%

C. 70%

D. 75%

Correct Answer: B

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Question 17

A sole trader has a business that generates an average annual income of ₦1,500,000. If the sole trader pays 25% of the income as tax, what is the amount of tax paid?

Correct A. ₦375,000

B. ₦375,000.00

C. ₦375,000.00

D. ₦375,000

Correct Answer: A

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Question 18

A company has a fleet of 10 vehicles, each with an average annual maintenance cost of ₦500,000. If the company pays 10% of the maintenance cost as insurance premium, what is the total amount of insurance premium paid?

Correct A. ₦50,000

B. ₦50,000.00

C. ₦50,000.00

D. ₦50,000

Correct Answer: A

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Question 19

A consumer protection agency receives a complaint from a customer who purchased a product for ₦20,000 but was given a defective product. The agency offers a refund of ₦15,000. What is the percentage of the refund?

Correct A. 75%

B. 80%

C. 85%

D. 90%

Correct Answer: A

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Question 20

A company has a warehouse with a capacity to store 5000 units of goods. The warehouse is currently 70% full. If 1500 units of goods are received in a shipment, what is the new percentage of the warehouse that is full?

A. 60%

Correct B. 65%

C. 70%

D. 75%

Correct Answer: B

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Question 21

Under the Consumer Protection Act, what is the primary responsibility of the Consumer Protection Council in Nigeria?

Correct A. To investigate consumer complaints and provide compensation to affected consumers

B. To regulate the activities of businesses and ensure compliance with consumer protection laws

C. To educate consumers on their rights and responsibilities under consumer protection laws

D. To prosecute businesses that engage in unfair trade practices

Correct Answer: A

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Question 22

A company is registered under the Companies and Allied Matters Act in Nigeria. What is the primary advantage of registering a company under this Act?

Correct A. Limited liability for shareholders

B. Easy transfer of ownership

C. Flexibility in management structure

D. Tax benefits

Correct Answer: A

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Question 23

A sole trader in Nigeria is required to keep records of all financial transactions. What is the primary purpose of these records?

A. To calculate tax liabilities

Correct B. To prepare financial statements

C. To identify areas for cost reduction

D. To track cash flow

Correct Answer: B

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Question 24

A company in Nigeria is planning to expand its operations into a new market. What is the primary consideration for the company when deciding on the new market?

Correct A. Market size and growth potential

B. Competitor analysis

C. Regulatory environment

D. Supply chain logistics

Correct Answer: A

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Question 25

A bank in Nigeria is required to maintain a minimum capital adequacy ratio of 10%. What is the primary purpose of this requirement?

Correct A. To ensure the bank has sufficient capital to meet its obligations

B. To prevent the bank from engaging in excessive risk-taking

C. To promote competition among banks

D. To reduce the risk of bank failures

Correct Answer: A

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