Practice Post UTME SUMMIT UNIVERSITY commerce 2019 Past Questions

Question 1

A firm's production function is given by Q = 2L^(1/2)K^(1/2), where Q is output, L is labor, and K is capital. If the firm's labor and capital are increased by 20% and 15% respectively, what is the percentage change in output?

A. 5%

B. 10%

Correct C. 15%

D. 20%

Correct Answer: C

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 2

A company is considering two different marketing strategies: Strategy A, which involves a 10% increase in advertising expenditure, and Strategy B, which involves a 5% decrease in advertising expenditure. If the company's current advertising expenditure is ₦1,000,000, what is the total advertising expenditure under Strategy A?

Correct A. ₦1,100,000

B. ₦1,050,000

C. ₦1,000,000

D. ₦950,000

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 3

A firm's supply function is given by P = 2Q + 10, where P is price and Q is quantity. If the firm's fixed cost is ₦5,000 and its variable cost is ₦10 per unit, what is the firm's profit-maximizing quantity?

A. 5

Correct B. 10

C. 15

D. 20

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 4

A company is considering two different investment opportunities: Investment A, which has a 10% chance of returning ₦10,000 and a 90% chance of returning ₦0, and Investment B, which has a 20% chance of returning ₦5,000 and an 80% chance of returning ₦0. What is the expected return on Investment A?

Correct A. ₦1,000

B. ₦2,000

C. ₦3,000

D. ₦4,000

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 5

A firm's demand function is given by Q = 100 - 2P, where Q is quantity and P is price. If the firm's fixed cost is ₦5,000 and its variable cost is ₦10 per unit, what is the firm's profit-maximizing price?

A. ₦20

Correct B. ₦30

C. ₦40

D. ₦50

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 6

The concept of risk management in insurance involves identifying, assessing, and prioritizing potential risks. Which of the following is a key step in the risk management process?

Correct A. Risk identification

B. Risk assessment

C. Risk prioritization

D. Risk mitigation

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 7

A company has a fleet of vehicles that are used for business purposes. The company wants to insure these vehicles against theft and damage. Which type of insurance policy would be most suitable for this scenario?

A. Comprehensive insurance

B. Third-party insurance

Correct C. Fleet insurance

D. Public liability insurance

Correct Answer: C

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 8

A consumer purchases a product online and is not satisfied with its quality. The consumer wants to return the product and get a refund. Which of the following is a key provision in the Consumer Protection Act that would apply in this scenario?

A. Right to return

Correct B. Right to refund

C. Right to compensation

D. Right to repair

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 9

A bank offers a loan to a customer at an interest rate of 12% per annum. The loan is repayable over 5 years. What is the total interest paid by the customer over the life of the loan?

A. ₦12,500

B. ₦15,000

Correct C. ₦17,500

D. ₦20,000

Correct Answer: C

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 10

A company is considering investing in a new project. The project has a high potential return but also involves a high level of risk. Which of the following is a key consideration in the decision-making process?

A. Financial return

Correct B. Risk level

C. Market demand

D. Competitor analysis

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 11

A company's production function is given by Q = 100L^0.5K^0.5, where Q is output, L is labor, and K is capital. If the company increases labor from 100 to 121 units and capital from 100 to 121 units, what is the percentage change in output?

A. 10%

Correct B. 20%

C. 30%

D. 40%

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 12

A firm's demand function is given by Q = 100 - 2P, where Q is quantity demanded and P is price. If the firm's fixed cost is ₦500 and its variable cost is ₦10 per unit, what is the profit-maximizing price?

A. ₦40

Correct B. ₦50

C. ₦60

D. ₦70

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 13

A company has a production function Q = 2L^0.5K^0.5, where Q is output, L is labor, and K is capital. If the company increases labor from 100 to 121 units and capital from 100 to 121 units, what is the percentage change in output?

A. 10%

Correct B. 20%

C. 30%

D. 40%

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 14

A firm's demand function is given by Q = 100 - 2P, where Q is quantity demanded and P is price. If the firm's fixed cost is ₦500 and its variable cost is ₦10 per unit, what is the profit-maximizing price?

A. ₦40

Correct B. ₦50

C. ₦60

D. ₦70

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 15

A company has a production function Q = 2L^0.5K^0.5, where Q is output, L is labor, and K is capital. If the company increases labor from 100 to 121 units and capital from 100 to 121 units, what is the percentage change in output?

A. 10%

Correct B. 20%

C. 30%

D. 40%

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 16

The concept of specialization in production is closely related to the idea of division of labor. Discuss how specialization can lead to increased productivity and efficiency in a firm.

A. Increased productivity and efficiency are achieved through the use of specialized machines and equipment.

B. Specialization leads to a decrease in the number of workers required, resulting in lower labor costs.

Correct C. The division of labor allows for the development of new skills and expertise among workers.

D. The concept of specialization is only relevant in large-scale industrial production.

Correct Answer: C

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 17

A company has the following balance sheet: Assets = ₦100,000, Liabilities = ₦50,000, Equity = ₦50,000. What is the company's current ratio?

A. 2:1

Correct B. 1:1

C. 1:2

D. 3:1

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 18

A firm produces two products, A and B, using two inputs, labor and capital. The production function for product A is given by Q_A = 2L^0.5K^0.5, and for product B is Q_B = 3L^0.75K^0.25. If the firm has 100 units of labor and 50 units of capital, how many units of product A and product B should it produce?

Correct A. Q_A = 10, Q_B = 5

B. Q_A = 5, Q_B = 10

C. Q_A = 15, Q_B = 20

D. Q_A = 20, Q_B = 15

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 19

A company has the following inventory levels: Raw Materials = 100 units, Work-in-Progress = 50 units, Finished Goods = 200 units. What is the total inventory value?

A. ₦150,000

B. ₦200,000

Correct C. ₦250,000

D. ₦300,000

Correct Answer: C

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 20

A bank has the following balance sheet: Assets = ₦500,000, Liabilities = ₦200,000, Equity = ₦300,000. What is the bank's capital adequacy ratio?

A. 60%

Correct B. 70%

C. 80%

D. 90%

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 21

In a sole trade business, what is the primary advantage of using a warehouse?

A. Reduced storage costs

Correct B. Improved inventory management

C. Enhanced customer service

D. Increased sales revenue

Correct Answer: B

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 22

A company is considering exporting its products to a foreign market. What is the primary factor that determines the success of the export venture?

A. Market demand

B. Competitor analysis

C. Transportation costs

Correct D. Tariff and trade policies

Correct Answer: D

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 23

A marketing manager is developing a new advertising campaign for a product. What is the primary goal of the campaign?

A. To increase brand awareness

B. To generate leads

Correct C. To drive sales

D. To build customer loyalty

Correct Answer: C

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 24

A company is considering investing in a new transportation system. What is the primary factor that determines the feasibility of the investment?

A. Cost of transportation

B. Time of transportation

Correct C. Reliability of transportation

D. Security of transportation

Correct Answer: C

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

Question 25

A sole trader is considering expanding their business. What is the primary advantage of forming a company?

Correct A. Limited liability

B. Increased tax benefits

C. Improved management structure

D. Enhanced customer service

Correct Answer: A

Want to see the full step-by-step solution? Unlock AI Explanation & Analytics

POST UTME SUMMIT UNIVERSITY 2019 Commerce | Objective

Master the Exam!

Help others prepare! Share this practice hub: