POST UTME REDEEMERS UNIVERSITY 2018 Commerce | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A company has the following budget constraint: X + 2Y = 8. If the price of X is ₦2 and the price of Y is ₦3, what is the opportunity cost of producing one more unit of Y?
A. ₦1
B. ₦2
C. ₦3
D. ₦4
Question 2
A sole trader's business is registered under which of the following?
A. Partnership
B. Sole Proprietorship
C. Limited Liability Company
D. Cooperative Society
Question 3
A company is considering the introduction of a new product line. The product has a high fixed cost of ₦500,000 and a variable cost of ₦200 per unit. The selling price of the product is ₦300 per unit. If the company expects to sell 2,000 units, what is the minimum price at which the product must be sold to break even?
A. ₦250
B. ₦275
C. ₦300
D. ₦325
Question 4
A company is considering the introduction of a new product line. The product has a high fixed cost of ₦500,000 and a variable cost of ₦200 per unit. The selling price of the product is ₦300 per unit. If the company expects to sell 2,000 units, what is the minimum price at which the product must be sold to break even?
A. ₦250
B. ₦275
C. ₦300
D. ₦325
Question 5
A firm's risk management strategy involves diversification, hedging, and insurance. Which of the following is a benefit of diversification?
A. Reduced risk
B. Increased risk
C. Improved liquidity
D. Enhanced profitability
Question 6
A firm is considering the introduction of a new product line. The product has a high fixed cost of ₦500,000 and a variable cost of ₦200 per unit. The selling price of the product is ₦300 per unit. If the company expects to sell 2,000 units, what is the minimum price at which the product must be sold to break even?
A. ₦250
B. ₦275
C. ₦300
D. ₦325
Question 7
In a perfectly competitive market, the supply curve is upward-sloping because
A. Firms are willing to supply more of the good as its price increases.
B. Firms are willing to supply less of the good as its price increases.
C. Firms are willing to supply the same quantity of the good regardless of its price.
D. Firms are unwilling to supply any of the good at any price.
Question 8
A company's sole trader is considering the purchase of a new warehouse to store its inventory. The warehouse has a capacity of 10,000 units and costs ₦5 million to purchase. The company's current warehouse has a capacity of 5,000 units and costs ₦2 million to rent. If the company expects to increase its sales by 20% in the next year, what is the minimum amount of money the company should save each month to afford the new warehouse?
A. ₦125,000
B. ₦150,000
C. ₦175,000
D. ₦200,000
Question 9
A firm's cost of capital is the minimum return required by investors for
A. Investing in the firm's equity
B. Investing in the firm's debt
C. Investing in the firm's retained earnings
D. Investing in the firm's preferred stock
Question 10
A bank offers a loan of ₦1 million to a customer at an interest rate of 15% per annum. The loan is repayable in 5 years. What is the total amount the customer will pay to the bank at the end of the loan period?
A. ₦1.5 million
B. ₦1.6 million
C. ₦1.7 million
D. ₦1.8 million
Question 11
A company's warehouse has a capacity of 10,000 units. If the current stock level is 8,000 units, what is the percentage of the warehouse that is currently occupied?
A. 80%
B. 85%
C. 90%
D. 95%
Question 12
In a perfectly competitive market, the law of diminishing marginal utility implies that the demand curve for a firm's product is
A. inelastic
B. elastic
C. unit elastic
D. perfectly inelastic
Question 13
A bank offers a 5-year fixed deposit account with an interest rate of 10% per annum. If the initial deposit is ₦100,000, what will be the total amount after 5 years?
A. ₦163,922
B. ₦164,000
C. ₦164,100
D. ₦164,200
Question 14
A company has a share capital of ₦1,000,000, divided into 100,000 ordinary shares of ₦10 each. What is the company's issued share capital?
A. ₦500,000
B. ₦1,000,000
C. ₦1,500,000
D. ₦2,000,000
Question 15
A company's articles of association is a document that outlines the rules and regulations of the company. Which of the following is NOT a part of the articles of association?
A. Objects of the company
B. Management structure
C. Dividend policy
D. Auditor's report

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