POST UTME WELLSPRING UNIVERSITY 2024 Commerce | Objective

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Question 1
A firm's production function is given by Q = 2L^0.5H^0.5, where Q is the quantity produced, L is the number of labor hours, and H is the number of hours of capital. If the firm wants to increase its production by 20%, what percentage increase in labor hours is required, assuming that the number of hours of capital remains constant?
A. 10%
B. 15%
Correct C. 20%
D. 25%

Correct Answer: C

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Question 2
A company has two warehouses, A and B, with capacities of 1000 and 500 units, respectively. Warehouse A has 800 units of stock, while Warehouse B has 200 units. If the company receives an order for 1200 units, how many units should be shipped from Warehouse A, assuming that the company wants to minimize the total distance traveled?
A. 400
Correct B. 500
C. 600
D. 800

Correct Answer: B

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Question 3
A firm's revenue function is given by R(x) = 2x^2 + 10x, where x is the number of units sold. If the firm wants to maximize its revenue, what is the optimal number of units to sell?
A. 5
Correct B. 10
C. 15
D. 20

Correct Answer: B

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Question 4
A company has two production lines, A and B, with production costs of 100 and 150 per unit, respectively. If the company produces 1000 units, what is the total production cost?
A. 100,000
B. 120,000
Correct C. 150,000
D. 180,000

Correct Answer: C

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Question 5
A firm's profit function is given by P(x) = 2x^2 - 10x + 100, where x is the number of units sold. If the firm wants to maximize its profit, what is the optimal number of units to sell?
A. 5
Correct B. 10
C. 15
D. 20

Correct Answer: B

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Question 6
A company is considering two marketing strategies: one that targets a niche market with a high-end product and another that targets a mass market with a low-end product. Which strategy is more likely to result in higher sales and profits?
Correct A. Niche market strategy
B. Mass market strategy
C. Both strategies are equally effective
D. Neither strategy is effective

Correct Answer: A

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Question 7
A firm produces two products, A and B, using two inputs, labor and capital. The production functions are given by the following equations: Q_A = 2L^0.5K^0.5 and Q_B = 3L^0.25K^0.75. If the firm has 100 units of labor and 200 units of capital, how many units of product A and product B should it produce to maximize profit?
A. Q_A = 50, Q_B = 150
Correct B. Q_A = 100, Q_B = 100
C. Q_A = 150, Q_B = 50
D. Q_A = 200, Q_B = 0

Correct Answer: B

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Question 8
A country has a trade deficit of 100 billion and a current account deficit of 50 billion. What is the likely cause of the trade deficit?
Correct A. Overvaluation of the domestic currency
B. Undervaluation of the domestic currency
C. High interest rates in the domestic country
D. Low interest rates in the domestic country

Correct Answer: A

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Question 9
A consumer has a budget constraint of 100 and a demand curve for a product given by the equation Q = 2P - 10. If the price of the product is 20, how many units of the product should the consumer buy?
A. 5 units
Correct B. 10 units
C. 15 units
D. 20 units

Correct Answer: B

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Question 10
A firm has a production function given by Q = 2L^0.5K^0.5. If the firm has 100 units of labor and 200 units of capital, what is the marginal product of labor?
A. 0.5
Correct B. 1
C. 2
D. 4

Correct Answer: B

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Question 11
Under the Consumer Protection Act, what is the primary responsibility of the Consumer Protection Council?
A. To regulate consumer goods and services
B. To protect consumers from unfair business practices
C. To promote consumer education and awareness
Correct D. To investigate consumer complaints and resolve disputes

Correct Answer: D

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Question 12
A company is considering launching a new product. Which of the following marketing strategies would be most effective in creating a buzz around the product?
A. Social media advertising
Correct B. Influencer marketing
C. Content marketing
D. Event marketing

Correct Answer: B

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Question 13
A sole trader has a business income of ₦1,500,000 and expenses of ₦800,000. What is the profit before tax?
Correct A. ₦700,000
B. ₦1,000,000
C. ₦1,300,000
D. ₦1,500,000

Correct Answer: A

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Question 14
A company has a fleet of vehicles for transporting goods. Which of the following is a benefit of using a private car for business purposes?
A. Increased productivity
B. Reduced fuel costs
C. Improved customer service
Correct D. Tax benefits

Correct Answer: D

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Question 15
A bank has a reserve requirement of 10%. If the bank's deposits are ₦10,000,000, what is the minimum amount of reserves it must hold?
Correct A. ₦1,000,000
B. ₦1,500,000
C. ₦2,000,000
D. ₦2,500,000

Correct Answer: A

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Question 16
A company is considering exporting its products to a foreign market. Which of the following is a key factor to consider in the decision-making process?
A. Political stability of the foreign country
B. Economic conditions of the foreign country
Correct C. Cultural differences between the foreign country and the company's home country
D. Environmental regulations of the foreign country

Correct Answer: C

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Question 17
A sole trader is considering expanding its business by taking on a partner. What are the potential advantages of this decision?
A. Increased financial resources
B. Improved decision-making
C. Enhanced reputation
Correct D. All of the above

Correct Answer: D

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Question 18
A company has purchased an insurance policy to protect against business risks. What is the primary purpose of this policy?
Correct A. To reduce the financial impact of business risks
B. To increase the company's revenue
C. To improve the company's reputation
D. To reduce the company's tax liability

Correct Answer: A

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Question 19
A consumer has purchased a product that has been damaged in transit. What is the consumer's right under the Consumer Protection Act?
A. To return the product for a full refund
B. To exchange the product for a similar one
Correct C. To claim compensation for the damage
D. To cancel the contract

Correct Answer: C

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Question 20
A company has been sued by a consumer for breach of contract. What is the company's defense under the Sale of Goods Act?
A. That the consumer was aware of the defect
Correct B. That the defect was not a result of the company's negligence
C. That the consumer had breached the contract
D. That the contract was void ab initio

Correct Answer: B

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Question 21
A company's marketing strategy involves a mix of advertising, sales promotions, and public relations. Which of the following best describes the primary goal of this strategy?
A. To increase brand awareness
Correct B. To drive sales and revenue
C. To build customer loyalty
D. To reduce marketing costs

Correct Answer: B

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Question 22
A sole trader's business is considered a separate legal entity from its owner. What is the primary reason for this separation?
Correct A. To limit the owner's personal liability
B. To increase the owner's tax liability
C. To simplify the business's financial reporting
D. To reduce the owner's business registration costs

Correct Answer: A

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Question 23
A company's financial statements are prepared in accordance with the Generally Accepted Accounting Principles (GAAP). Which of the following is a key principle of GAAP?
Correct A. The matching principle
B. The revenue recognition principle
C. The cost principle
D. The going concern principle

Correct Answer: A

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Question 24
A consumer protection law requires businesses to provide clear and accurate information about their products. Which of the following is a key aspect of this law?
A. To ensure product safety
Correct B. To prevent false advertising
C. To promote fair competition
D. To reduce consumer complaints

Correct Answer: B

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Question 25
A company's marketing strategy involves a mix of advertising, sales promotions, and public relations. Which of the following best describes the primary goal of this strategy?
A. To increase brand awareness
Correct B. To drive sales and revenue
C. To build customer loyalty
D. To reduce marketing costs

Correct Answer: B

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