POST UTME UI 2024 Commerce | Objective

Are you preparing for POST UTME UI exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2024 Commerce (Objective) questions designed to simulate the real exam environment.

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Question 1
In a market with perfect competition, what is the relationship between the price elasticity of demand and the firm's ability to influence the market price?
A. The firm's ability to influence the market price increases as the price elasticity of demand decreases.
Correct B. The firm's ability to influence the market price decreases as the price elasticity of demand increases.
C. The firm's ability to influence the market price is unaffected by the price elasticity of demand.
D. The firm's ability to influence the market price increases as the price elasticity of demand increases.

Correct Answer: B

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Question 2
A company is considering two different marketing strategies: a high-low pricing strategy and a penetration pricing strategy. Which strategy is more likely to increase market share in the short run?
A. High-low pricing strategy
Correct B. Penetration pricing strategy
C. Both strategies are equally effective in increasing market share
D. Neither strategy is effective in increasing market share

Correct Answer: B

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Question 3
A consumer protection agency is considering a new regulation that would require all businesses to provide a clear and concise explanation of their pricing policies. Which of the following is a potential benefit of this regulation?
Correct A. Increased transparency in pricing policies
B. Reduced competition among businesses
C. Increased costs for businesses
D. Decreased consumer satisfaction

Correct Answer: A

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Question 4
A warehouse is using a first-in, first-out (FIFO) inventory management system. If the warehouse receives a new shipment of goods, what is the impact on the inventory levels?
A. Inventory levels decrease
Correct B. Inventory levels increase
C. Inventory levels remain unchanged
D. Inventory levels fluctuate

Correct Answer: B

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Question 5
A bank is considering a new loan product that would offer a variable interest rate tied to the prime lending rate. Which of the following is a potential risk associated with this loan product?
A. Increased competition among banks
B. Reduced credit risk for the bank
Correct C. Increased credit risk for the bank
D. Decreased demand for the loan product

Correct Answer: C

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Question 6
In a sole trade business, what is the primary advantage of using a sole trader structure?
A. Limited liability
B. Easy to set up
Correct C. Flexibility in decision-making
D. No tax benefits

Correct Answer: C

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Question 7
A company has a share capital of ₦1,000,000, divided into 100,000 ordinary shares of ₦10 each. If the company issues 20,000 shares to the public, what is the amount of share capital raised?
A. ₦200,000
Correct B. ₦400,000
C. ₦600,000
D. ₦800,000

Correct Answer: B

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Question 8
A consumer purchases a product with a price of ₦5,000. If the product is subject to a 10% discount, what is the amount the consumer pays?
Correct A. ₦4,500
B. ₦4,000
C. ₦4,500
D. ₦5,000

Correct Answer: A

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Question 9
A company uses the following transportation costs: ₦10,000 for land transport and ₦20,000 for air transport. If the company uses both modes of transport, what is the total transportation cost?
A. ₦30,000
B. ₦40,000
Correct C. ₦50,000
D. ₦60,000

Correct Answer: C

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Question 10
A foreign trade agreement between two countries involves the exchange of goods worth ₦1,000,000. If the exchange rate is 1 USD = ₦500, what is the equivalent value in USD?
A. 2,000
Correct B. 2,500
C. 3,000
D. 3,500

Correct Answer: B

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Question 11
In a perfectly competitive market, what is the relationship between the marginal revenue product of labor (MRPL) and the marginal factor cost (MFC)?
A. MRPL > MFC
B. MRPL < MFC
Correct C. MRPL = MFC
D. MRPL ≠ MFC

Correct Answer: C

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Question 12
A company is considering investing in a new project with an initial investment of ₦1,500,000 and expected annual cash flows of ₦500,000 for 5 years. What is the net present value (NPV) of the project using a discount rate of 10%?
Correct A. ₦1,200,000
B. ₦1,500,000
C. ₦1,800,000
D. ₦2,100,000

Correct Answer: A

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Question 13
A sole trader, Mr. A, has a business income of ₦2,000,000 and business expenses of ₦800,000. What is his business profit?
Correct A. ₦1,200,000
B. ₦1,600,000
C. ₦2,000,000
D. ₦2,400,000

Correct Answer: A

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Question 14
A company has a warehouse with a capacity of 10,000 units. The current stock level is 5,000 units, and the company receives a new shipment of 3,000 units. What is the new stock level?
A. 3,000
B. 5,000
Correct C. 7,000
D. 10,000

Correct Answer: C

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Question 15
A foreign trade agreement between two countries involves the exchange of goods worth ₦1,000,000 for goods worth 200,000. What is the exchange rate?
A. ₦5 = 1
Correct B. ₦10 = 1
C. ₦20 = 1
D. ₦50 = 1

Correct Answer: B

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Question 16
A firm's marketing strategy involves a mix of both push and pull strategies. Which of the following is a characteristic of a pull strategy?
Correct A. Creating awareness about the product among the target audience
B. Encouraging repeat purchases through loyalty programs
C. Providing incentives to intermediaries to push the product
D. Creating a sense of urgency among customers to make a purchase

Correct Answer: A

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Question 17
A bank's cash management system involves the following steps: cash forecasting, cash budgeting, cash flow management, and cash control. Which of the following is a key benefit of cash budgeting?
Correct A. Improved cash flow management
B. Reduced cash handling costs
C. Enhanced customer satisfaction
D. Increased profitability

Correct Answer: A

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Question 18
A firm's supply chain management involves the following activities: procurement, production, inventory management, and distribution. Which of the following is a key objective of inventory management?
A. To minimize inventory costs
Correct B. To maximize inventory turnover
C. To reduce lead times
D. To improve product quality

Correct Answer: B

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Question 19
A firm's marketing mix involves the following elements: product, price, promotion, and place. Which of the following is a key characteristic of a product?
Correct A. It must be unique and differentiated
B. It must be priced competitively
C. It must be promoted effectively
D. It must be placed conveniently

Correct Answer: A

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Question 20
A firm's financial management involves the following activities: financial planning, financial control, and financial reporting. Which of the following is a key benefit of financial planning?
A. Improved financial performance
B. Enhanced financial stability
C. Increased financial flexibility
Correct D. Better financial decision-making

Correct Answer: D

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Question 21
The concept of comparative advantage in international trade is based on the idea that countries should specialize in producing goods for which they have a lower opportunity cost. Which of the following is a correct example of comparative advantage?
A. Nigeria producing textiles and importing food
Correct B. Nigeria producing food and importing textiles
C. Nigeria producing both textiles and food
D. Nigeria producing neither textiles nor food

Correct Answer: B

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Question 22
A company's production function is given by the equation Q = 2L + 3K, where Q is the quantity produced, L is the number of labor hours, and K is the amount of capital invested. If the company wants to produce 100 units of output, how many labor hours are required if the amount of capital invested is 20?
A. 10
B. 20
Correct C. 30
D. 40

Correct Answer: C

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Question 23
A firm's revenue function is given by the equation R(x) = 2x^2 + 5x, where x is the number of units sold. If the firm wants to maximize its revenue, how many units should it sell?
A. 5
Correct B. 10
C. 15
D. 20

Correct Answer: B

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Question 24
A company's cost function is given by the equation C(x) = 3x^2 + 2x, where x is the number of units produced. If the company produces 10 units, what is the total cost?
A. 100
B. 150
Correct C. 200
D. 250

Correct Answer: C

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Question 25
A firm's profit function is given by the equation P(x) = R(x) - C(x), where R(x) is the revenue function and C(x) is the cost function. If the revenue function is R(x) = 2x^2 + 5x and the cost function is C(x) = 3x^2 + 2x, what is the profit function?
Correct A. -x^2 + 3x
B. x^2 + 3x
C. 2x^2 + 3x
D. 3x^2 + 2x

Correct Answer: A

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