POST UTME LEAD CITY UNIVERSITY 2021 Commerce | Objective

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Question 1 View Details
In a perfectly competitive market, the supply curve is typically represented by the law of supply, which states that as the price of a good increases, the quantity supplied also increases. However, this is not always the case. What is the name of the phenomenon that occurs when the quantity supplied decreases as the price increases?
A. Giffen Goods
Correct B. Inferior Goods
C. Normal Goods
D. Veblen Goods

Correct Answer: B

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Question 2 View Details
A company is considering two investment options: Option A, which has a 10% chance of returning 100,000 and a 90% chance of returning 0, and Option B, which has a 20% chance of returning 80,000 and a 80% chance of returning 0. Which option has a higher expected return?
Correct A. Option A
B. Option B
C. Option A and Option B are equally likely to return the highest amount
D. Neither option is likely to return a significant amount

Correct Answer: A

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Question 3 View Details
A firm is considering two production levels: Level A, which requires an initial investment of 100,000 and produces 100 units per day, and Level B, which requires an initial investment of 200,000 and produces 200 units per day. If the firm expects to sell the units at 50 each, which production level will result in the highest profit?
A. Level A
Correct B. Level B
C. Both production levels will result in the same profit
D. Neither production level will result in a significant profit

Correct Answer: B

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Question 4 View Details
A firm is considering two marketing strategies: Strategy A, which involves a 50,000 advertising campaign and is expected to increase sales by 10%, and Strategy B, which involves a 100,000 advertising campaign and is expected to increase sales by 20%. If the firm expects to sell the units at 50 each, which marketing strategy will result in the highest revenue?
A. Strategy A
Correct B. Strategy B
C. Both marketing strategies will result in the same revenue
D. Neither marketing strategy will result in a significant revenue

Correct Answer: B

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Question 5 View Details
A firm is considering two pricing strategies: Strategy A, which involves setting a price of 50 per unit and is expected to result in a demand of 100 units, and Strategy B, which involves setting a price of 75 per unit and is expected to result in a demand of 50 units. If the firm expects to sell the units at the price of 50 per unit, which pricing strategy will result in the highest revenue?
Correct A. Strategy A
B. Strategy B
C. Both pricing strategies will result in the same revenue
D. Neither pricing strategy will result in a significant revenue

Correct Answer: A

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Question 6 View Details
A bank's decision to increase interest rates on loans to control inflation is an example of a(n) _______ policy.
Correct A. Monetary policy
B. Fiscal policy
C. Supply-side policy
D. Demand-side policy

Correct Answer: A

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Question 7 View Details
A company's financial statements are audited by an independent auditor to ensure _______.
Correct A. Accuracy
B. Completeness
C. Reliability
D. Consistency

Correct Answer: A

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Question 8 View Details
A sole trader's business is not registered with the _______.
Correct A. Corporate Affairs Commission
B. Federal Inland Revenue Service
C. National Insurance Commission
D. Central Bank of Nigeria

Correct Answer: A

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Question 9 View Details
A consumer protection agency is responsible for enforcing the _______ Act.
A. Consumer Protection
B. Competition and Consumer Protection
Correct C. Federal Competition and Consumer Protection
D. National Consumer Protection

Correct Answer: C

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Question 10 View Details
A company's financial statements are prepared in accordance with the _______ Standards.
A. Generally Accepted Accounting Principles
Correct B. International Financial Reporting Standards
C. Financial Reporting Standards
D. Accounting Standards

Correct Answer: B

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Question 11 View Details
In a perfectly competitive market, the supply curve is upward-sloping because of the law of increasing
Correct A. marginal opportunity cost
B. marginal benefit
C. marginal utility
D. marginal revenue

Correct Answer: A

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Question 12 View Details
A company's break-even point is the point at which its total revenue equals its
A. total fixed costs
B. total variable costs
Correct C. total costs
D. net income

Correct Answer: C

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Question 13 View Details
A sole trader's business is not separate from their personal finances because they do not have a
A. business bank account
B. business license
C. business registration
Correct D. separate legal entity

Correct Answer: D

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Question 14 View Details
A company's marketing mix consists of the 4 Ps: product, price, place, and
Correct A. promotion
B. people
C. process
D. physical distribution

Correct Answer: A

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Question 15 View Details
A warehouse's inventory turnover ratio is calculated by dividing the cost of goods sold by the
Correct A. average inventory
B. total inventory
C. inventory turnover
D. days inventory outstanding

Correct Answer: A

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Question 16 View Details
A company's marketing strategy involves a mix of push and pull strategies. Which of the following best describes the primary objective of a pull strategy?
A. To increase the company's market share
B. To create awareness about the product among the target audience
Correct C. To persuade the target audience to buy the product
D. To reduce the cost of production

Correct Answer: C

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Question 17 View Details
A 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. If the firm wants to produce 100 units of output, and it has 20 units of labor available, how many units of capital should it hire?
A. 10
Correct B. 15
C. 20
D. 25

Correct Answer: B

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Question 18 View Details
A company's cost function is given by the equation C = 2L + 5K, where C is the total cost, L is the labor input, and K is the capital input. If the firm hires 10 units of labor and 20 units of capital, what is the total cost?
A. 50
B. 60
Correct C. 70
D. 80

Correct Answer: C

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Question 19 View Details
A firm's revenue function is given by the equation R = 2Q^2, where R is the total revenue and Q is the quantity sold. If the firm sells 10 units of output, what is the total revenue?
A. 20
B. 40
Correct C. 60
D. 80

Correct Answer: C

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Question 20 View Details
A company's profit function is given by the equation P = R - C, where P is the profit, R is the revenue, and C is the cost. If the firm's revenue is 100 and its cost is 50, what is the profit?
A. 20
B. 30
Correct C. 40
D. 50

Correct Answer: C

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Question 21 View Details
A company's marketing strategy involves creating a sense of urgency among its customers to purchase a product. This strategy 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 22 View Details
A bank's assets include its cash reserves, loans, and securities. Which of the following is NOT an asset of the bank?
A. Cash reserves
B. Loans
C. Securities
Correct D. Deposits

Correct Answer: D

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Question 23 View Details
A policyholder purchases a life insurance policy with a face value of ₦1,000,000. The policy has a premium of ₦50,000 per annum. If the policyholder dies after 5 years, the insurance company will pay the face value of the policy. Which of the following is the present value of the insurance policy?
A. ₦250,000
Correct B. ₦500,000
C. ₦750,000
D. ₦1,000,000

Correct Answer: B

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Question 24 View Details
A consumer purchases a product online and pays for it using a credit card. The consumer is protected by which of the following laws?
A. Consumer Protection Act
Correct B. Electronic Transactions Act
C. Banking and Other Financial Institutions Act
D. Insurance Act

Correct Answer: B

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Question 25 View Details
A company exports goods worth ₦5,000,000 to a foreign country. The company incurs a transportation cost of ₦200,000 and a customs duty of ₦300,000. What is the total cost of exporting the goods?
A. ₦5,500,000
B. ₦5,800,000
Correct C. ₦6,000,000
D. ₦6,200,000

Correct Answer: C

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