POST UTME MOUNTAIN TOP UNIVERSITY 2021 Commerce | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A firm's production function is given by Q = 2L^0.5K^0.5. If the price of labor is ₦100 per unit and the price of capital is ₦200 per unit, what is the optimal combination of labor and capital that minimizes the cost of production?
A. L = 4, K = 1
B. L = 2, K = 2
C. L = 1, K = 4
D. L = 0, K = 0
Question 2
A company is considering the introduction of a new product line. The product has a high fixed cost of production, but a low variable cost. The company expects to sell 1000 units of the product per month at a price of ₦500 per unit. Calculate the contribution margin per unit and the break-even point in units.
A. ₦400
B. ₦450
C. ₦500
D. ₦550
Question 3
A company is considering investing in a new project. The project has a net present value (NPV) of ₦750,000 and a payback period of 7 years. What is the internal rate of return (IRR) of the project?
A. 8%
B. 12%
C. 15%
D. 18%
Question 4
A firm is considering two different types of insurance policies: term life insurance and whole life insurance. The term life insurance policy costs ₦75,000 per year and provides a death benefit of ₦1,500,000. The whole life insurance policy costs ₦150,000 per year and provides a death benefit of ₦3,000,000. What is the difference in cost between the two policies over a 10-year period?
A. ₦750,000
B. ₦1,000,000
C. ₦1,250,000
D. ₦1,500,000
Question 5
A firm specializes in producing a single product, which is a type of commodity. What is the primary advantage of this specialization?
A. Economies of scale
B. Increased competition
C. Reduced production costs
D. Improved product quality
Question 6
A firm's revenue function is given by R(x) = 2x^2 + 5x - 3, where x is the number of units sold. If the firm sells 10 units, what is the marginal revenue?
A. 20
B. 30
C. 40
D. 50
Question 7
A company is considering entering a new market. What type of market research would be most appropriate for this situation?
A. Secondary research
B. Primary research
C. Market segmentation
D. Target market analysis
Question 8
A company is considering investing in a new project. The project has a net present value (NPV) of ₦1,000,000 and a payback period of 10 years. What is the internal rate of return (IRR) of the project?
A. 5%
B. 10%
C. 15%
D. 20%
Question 9
A consumer protection agency has received a complaint from a customer who was sold a defective product. The product was purchased for ₦10,000 and the customer is seeking a refund of ₦8,000. The agency has determined that the product was indeed defective and has ordered the seller to refund the customer. However, the seller is refusing to comply. What action can the agency take to enforce the refund?
A. The agency can issue a warning to the seller and monitor their compliance.
B. The agency can impose a fine on the seller and order them to refund the customer.
C. The agency can take the seller to court and seek a court order to enforce the refund.
D. The agency can negotiate a settlement with the seller and the customer.
Question 10
A consumer has a utility function given by U = 2x + 3y, where x and y are the quantities of two goods consumed. If the prices of the two goods are ₦50 and ₦75 respectively, and the consumer has a budget of ₦300, what is the optimal combination of x and y that maximizes utility?
A. x = 2, y = 2
B. x = 4, y = 1
C. x = 1, y = 4
D. x = 0, y = 0
Question 11
A company is considering two different types of insurance policies: term life insurance and whole life insurance. The term life insurance policy costs ₦50,000 per year and provides a death benefit of ₦1,000,000. The whole life insurance policy costs ₦100,000 per year and provides a death benefit of ₦2,000,000. What is the difference in cost between the two policies over a 10-year period?
A. ₦500,000
B. ₦750,000
C. ₦1,000,000
D. ₦1,500,000
Question 12
A firm's cost function is given by C(x) = 2x^2 + 5x, where x is the number of units produced. If the firm produces 4 units, what is its total cost?
A. ₦50
B. ₦60
C. ₦70
D. ₦80
Question 13
A consumer has a utility function given by U = 2x + 3y, where x and y are the quantities of two goods consumed. If the prices of the two goods are ₦50 and ₦75 respectively, and the consumer has a budget of ₦300, what is the optimal combination of x and y that maximizes utility?
A. x = 2, y = 2
B. x = 4, y = 1
C. x = 1, y = 4
D. x = 0, y = 0
Question 14
A firm is considering exporting its products to a foreign market. The firm has a production capacity of 10,000 units per month and a selling price of ₦500 per unit. The firm's costs include a fixed cost of ₦100,000 per month and a variable cost of ₦50 per unit. What is the firm's profit per unit of production?
A. ₦300
B. ₦350
C. ₦400
D. ₦450
Question 15
A consumer is considering purchasing a product that has a 10% sales tax. If the original price is ₦500, what is the new price after the tax?
A. ₦550
B. ₦500
C. ₦450
D. ₦400

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