POST UTME AAUA 2020 Commerce | Objective

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Question 1
A company is considering the introduction of a new product line. The product line has a high fixed cost of ₦500 million and a variable cost of ₦50,000 per unit. The selling price of the product is ₦75,000 per unit. If the company expects to sell 10,000 units, what is the minimum revenue required to break even?
A. ₦500 million
B. ₦750 million
C. ₦1.25 billion
D. ₦1.5 billion
Question 2
A firm's transportation costs are typically a function of the distance between the supplier and the customer. Which of the following is a common transportation cost?
A. Fuel costs
B. Labor costs
C. Equipment costs
D. All of the above
Question 3
A firm is considering the introduction of a new product line. The product line has a high fixed cost of ₦500 million and a variable cost of ₦50,000 per unit. The selling price of the product is ₦75,000 per unit. If the company expects to sell 10,000 units, what is the minimum revenue required to break even?
A. ₦500 million
B. ₦750 million
C. ₦1.25 billion
D. ₦1.5 billion
Question 4
A consumer is considering purchasing a product that has a high price but also has a high quality. Which of the following is a correct consumer behavior?
A. The consumer is likely to purchase the product because of its high quality.
B. The consumer is likely to purchase the product because of its low price.
C. The consumer is likely to purchase the product because of its brand reputation.
D. The consumer is likely to purchase the product because of its advertising.
Question 5
A consumer is considering purchasing a product that has a high price but also has a high quality. Which of the following is a correct consumer behavior?
A. The consumer is likely to purchase the product because of its high quality.
B. The consumer is likely to purchase the product because of its low price.
C. The consumer is likely to purchase the product because of its brand reputation.
D. The consumer is likely to purchase the product because of its advertising.
Question 6
A company uses the following data to calculate its weighted average cost of capital (WACC):
A. Debt: 60%, Equity: 40%
B. Debt: 40%, Equity: 60%
C. Debt: 50%, Equity: 50%
D. Debt: 70%, Equity: 30%
Question 7
The concept of 'just-in-time' inventory system is most closely related to which of the following transportation modes?
A. Air Freight
B. Truckload
C. Intermodal
D. Rail
Question 8
A company is considering the introduction of a new product line. The product line has a high fixed cost of ₦500 million and a variable cost of ₦50,000 per unit. The selling price of the product is ₦75,000 per unit. If the company expects to sell 10,000 units, what is the minimum revenue required to break even?
A. ₦500 million
B. ₦750 million
C. ₦1.25 billion
D. ₦1.5 billion
Question 9
A company's financial statements are audited by an external auditor. What is the primary purpose of this audit?
A. To verify the company's financial performance
B. To ensure compliance with tax laws
C. To provide an opinion on the company's financial statements
D. To identify areas for cost reduction
Question 10
A company is considering the use of social media to promote its products. Which of the following is a correct social media marketing strategy?
A. The company should focus on creating engaging content to increase customer engagement.
B. The company should focus on increasing the number of followers to increase brand awareness.
C. The company should focus on increasing the number of likes to increase customer satisfaction.
D. The company should focus on increasing the number of shares to increase revenue.
Question 11
A company is considering the introduction of a new product. The product has a high demand, but the production costs are also high. Which of the following is a correct marketing strategy for this product?
A. The company should focus on reducing production costs to increase profit margins.
B. The company should focus on increasing the product's quality to increase customer satisfaction.
C. The company should focus on increasing the product's price to increase revenue.
D. The company should focus on increasing the product's advertising to increase demand.
Question 12
A consumer purchases a product for ₦5,000 and pays a 10% sales tax. If the consumer returns the product and receives a refund, what is the amount of refund?
A. ₦4,500
B. ₦4,750
C. ₦5,000
D. ₦5,250
Question 13
A warehouse manager is responsible for storing goods in a warehouse. Which of the following is a key principle of warehouse management?
A. First-in, first-out (FIFO) inventory management
B. Last-in, first-out (LIFO) inventory management
C. Just-in-time (JIT) inventory management
D. Economic order quantity (EOQ) inventory management
Question 14
A firm is considering two different pricing strategies for its new product. Strategy A involves a high initial price of ₦10,000 per unit and a discount of 10% for bulk purchases. Strategy B involves a low initial price of ₦5,000 per unit and a discount of 20% for bulk purchases. If the firm expects to sell 20,000 units, what is the total revenue for each strategy?
A. ₦80 million
B. ₦60 million
C. ₦100 million
D. ₦120 million
Question 15
A company is considering using a lean management approach to improve its operations. Which of the following is a key principle of lean management?
A. Elimination of waste
B. Continuous improvement
C. Employee involvement
D. All of the above

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