POST UTME WELLSPRING UNIVERSITY 2023 Commerce | Objective

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Question 1
In a perfectly competitive market, the supply curve is downward sloping because
A. Firms can increase production to meet increased demand
B. Firms can decrease production to meet decreased demand
Correct C. Firms can increase production to meet increased demand, but at a higher cost
D. Firms can decrease production to meet decreased demand, but at a lower cost

Correct Answer: C

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Question 2
A firm's revenue is maximized when the price elasticity of demand is
A. Unit elastic
B. Inelastic
Correct C. Elastic
D. Perfectly elastic

Correct Answer: C

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Question 3
A firm's cost of production can be minimized when the price elasticity of supply is
A. Unit elastic
Correct B. Inelastic
C. Elastic
D. Perfectly elastic

Correct Answer: B

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Question 4
A firm's profit is maximized when the price elasticity of demand is
A. Unit elastic
B. Inelastic
Correct C. Elastic
D. Perfectly elastic

Correct Answer: C

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Question 5
A firm's revenue is maximized when the price elasticity of demand is
A. Unit elastic
B. Inelastic
Correct C. Elastic
D. Perfectly elastic

Correct Answer: C

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Question 6
Determine the value of x in the equation ( log_{10} (x^2) = 4 ).
Correct A. 10
B. 100
C. 1000
D. 10000

Correct Answer: A

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Question 7
A company has 500 units of a product in stock. If 30% of the units are sold, and the remaining units are stored in a warehouse with a capacity of 2000 units, what is the percentage of the warehouse's capacity that is occupied?
A. 15%
B. 20%
Correct C. 25%
D. 30%

Correct Answer: C

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Question 8
A firm imports goods worth ₦1,500,000. If the government imposes a 10% duty on the imported goods, what is the amount of duty paid?
A. ₦150,000
Correct B. ₦200,000
C. ₦250,000
D. ₦300,000

Correct Answer: B

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Question 9
A sole trader has a capital of ₦500,000. If he invests ₦200,000 in a new business venture, what is the percentage increase in his capital?
A. 20%
B. 25%
Correct C. 30%
D. 35%

Correct Answer: C

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Question 10
A company has a warehouse with a capacity of 1000 units. If 75% of the warehouse is occupied, and the company wants to increase the capacity by 20%, what is the new capacity?
A. 1200
B. 1300
Correct C. 1400
D. 1500

Correct Answer: C

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Question 11
A firm specializes in producing a single product. If the firm's production function is given by Q = 2L^0.5, where Q is the quantity produced and L is the labor input, and the wage rate is ₦100 per hour, what is the marginal product of labor?
A. ₦50 per hour
Correct B. ₦100 per hour
C. ₦150 per hour
D. ₦200 per hour

Correct Answer: B

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Question 12
A company has two production plants, A and B. Plant A produces 100 units of a product per hour, while plant B produces 150 units per hour. If the company wants to produce a total of 500 units per hour, how many hours will it take to produce this quantity?
A. 2 hours
B. 3 hours
Correct C. 4 hours
D. 5 hours

Correct Answer: C

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Question 13
A bank has a reserve requirement of 10% and a cash reserve of ₦100,000. If the bank wants to increase its cash reserve by 20%, what will be the new cash reserve?
A. ₦120,000
B. ₦140,000
Correct C. ₦160,000
D. ₦180,000

Correct Answer: C

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Question 14
A sole trader has a business income of ₦500,000 and a business expense of ₦200,000. If the sole trader wants to save 20% of the business income, how much will be saved?
A. ₦50,000
B. ₦60,000
Correct C. ₦70,000
D. ₦80,000

Correct Answer: C

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Question 15
A company has a warehouse with a capacity of 10,000 units. If the company wants to store 8,000 units of a product, what is the storage capacity utilization rate?
A. 80%
Correct B. 90%
C. 95%
D. 98%

Correct Answer: B

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Question 16
A company is considering two different transportation modes to move its products from the factory to the warehouse. Mode A involves hiring a truck for a one-time delivery, while Mode B involves hiring a truck for a weekly delivery. If the cost of hiring a truck for a one-time delivery is ₦15,000, and the cost of hiring a truck for a weekly delivery is ₦10,000 per week, what is the minimum number of weeks the company must operate to make Mode B more cost-effective?
A. 4 weeks
B. 6 weeks
Correct C. 8 weeks
D. 10 weeks

Correct Answer: C

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Question 17
A firm is considering two different insurance policies to protect its assets. Policy A has a premium of ₦50,000 and a deductible of ₦20,000, while Policy B has a premium of ₦30,000 and a deductible of ₦10,000. If the firm expects to incur a loss of ₦40,000, which policy would provide the greatest protection?
Correct A. Policy A
B. Policy B
C. Policy A and Policy B
D. Neither Policy A nor Policy B

Correct Answer: A

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Question 18
A company is considering exporting its products to a foreign market. The company has a fixed cost of ₦100,000 and a variable cost of ₦50 per unit. If the company expects to sell 1,000 units at a price of ₦200 per unit, what is the minimum price the company must charge to break even?
A. ₦150
Correct B. ₦175
C. ₦200
D. ₦225

Correct Answer: B

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Question 19
A firm is considering investing in a warehouse to store its products. The firm expects to store 10,000 units of product, and the warehouse will cost ₦500,000 to build. If the firm expects to sell 1,000 units per week, what is the minimum number of weeks the firm must operate to recover its investment?
A. 5 weeks
B. 10 weeks
Correct C. 15 weeks
D. 20 weeks

Correct Answer: C

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Question 20
A company is considering launching a new product. The company expects to spend ₦500,000 on advertising and ₦200,000 on production. If the company expects to sell 1,000 units at a price of ₦200 per unit, what is the minimum price the company must charge to break even?
A. ₦150
Correct B. ₦175
C. ₦200
D. ₦225

Correct Answer: B

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Question 21
A firm specializes in producing a single product, which is a type of commodity. The firm's production function is given by Q = 100L^0.5, where Q is the quantity produced and L is the labor input. If the firm wants to produce 400 units of the commodity, how many units of labor are required?
A. 50
B. 100
Correct C. 200
D. 400

Correct Answer: C

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Question 22
A bank's balance sheet is given below. What is the bank's liquidity ratio?
A. 0.2
Correct B. 0.3
C. 0.4
D. 0.5

Correct Answer: B

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Question 23
A company's income statement is given below. What is the company's net profit?
A. 100,000
B. 200,000
Correct C. 300,000
D. 400,000

Correct Answer: C

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Question 24
A firm's production function is given by Q = 100L^0.5, where Q is the quantity produced and L is the labor input. If the firm wants to produce 400 units of the commodity, how many units of labor are required?
A. 50
B. 100
Correct C. 200
D. 400

Correct Answer: C

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Question 25
A company's balance sheet is given below. What is the company's total assets?
A. 500,000
B. 750,000
C. 1,000,000
Correct D. 1,500,000

Correct Answer: D

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