Practice post utme achievers university commerce 2020 Past Questions

Question 1

A firm is considering two production technologies: one that requires a high initial investment but results in lower production costs over time, and another that requires a low initial investment but results in higher production costs over time. Which of the following statements best describes the relationship between the two technologies?

A. The high initial investment technology is more capital-intensive than the low initial investment technology.

B. The low initial investment technology is more labor-intensive than the high initial investment technology.

Correct C. The high initial investment technology has a higher marginal cost than the low initial investment technology.

D. The low initial investment technology has a higher fixed cost than the high initial investment technology.

Correct Answer: C

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Question 2

A company is considering launching a new product in a foreign market. The company has conducted market research and determined that the product will be successful in the foreign market. However, the company is concerned about the potential risks associated with launching a new product in a foreign market. Which of the following strategies would be most effective in mitigating these risks?

A. Conducting thorough market research to identify potential risks and opportunities.

B. Partnering with a local company to co-brand and co-market the product.

C. Establishing a local subsidiary to manage the product launch.

Correct D. Focusing on a small pilot launch to test the market.

Correct Answer: D

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Question 3

A consumer has filed a complaint with the Better Business Bureau against a company for violating the Federal Trade Commission's (FTC) guidelines on advertising. The company has advertised a product as 'all-natural' when, in fact, it contains artificial ingredients. Which of the following is the primary purpose of the FTC's guidelines on advertising?

Correct A. To protect consumers from false or misleading advertising.

B. To promote fair competition among businesses.

C. To regulate the content of advertisements.

D. To ensure that companies comply with industry standards.

Correct Answer: A

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Question 4

A company is considering importing goods from a foreign country. The company has determined that the foreign country has a comparative advantage in producing the goods. However, the company is concerned about the potential risks associated with importing goods from a foreign country. Which of the following strategies would be most effective in mitigating these risks?

A. Conducting thorough market research to identify potential risks and opportunities.

B. Establishing a local subsidiary to manage the importation of goods.

C. Partnering with a local company to co-brand and co-market the goods.

Correct D. Focusing on a small pilot importation to test the market.

Correct Answer: D

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Question 5

A company has purchased a liability insurance policy to protect against potential lawsuits. The policy has a deductible of ₦100,000 and a policy limit of ₦500,000. If the company is sued for ₦750,000, how much will the company have to pay out of pocket?

A. ₦250,000

Correct B. ₦350,000

C. ₦450,000

D. ₦550,000

Correct Answer: B

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Question 6

A company's marketing strategy involves a mix of advertising and sales promotions. Which of the following is a characteristic of a sales promotion?

A. It is a long-term strategy

Correct B. It is a short-term strategy

C. It is a product-based strategy

D. It is a price-based strategy

Correct Answer: B

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Question 7

A sole trader's business is affected by the following factors: market conditions, competition, and government policies. Which of the following is a characteristic of a sole trader?

A. It is a partnership

B. It is a limited company

Correct C. It is a sole trader

D. It is a cooperative society

Correct Answer: C

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Question 8

A company's foreign trade involves exporting goods to other countries. Which of the following is a benefit of exporting goods?

Correct A. It increases the company's revenue

B. It reduces the company's costs

C. It increases the company's market share

D. It reduces the company's risk

Correct Answer: A

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Question 9

A company's insurance policy covers losses due to fire, theft, and natural disasters. Which of the following is a type of insurance policy?

A. Fire insurance

B. Theft insurance

C. Natural disaster insurance

Correct D. All-risk insurance

Correct Answer: D

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Question 10

A company's marketing strategy involves creating a brand identity through advertising and packaging. Which of the following is a characteristic of a brand identity?

A. It is a product-based strategy

B. It is a price-based strategy

C. It is a service-based strategy

Correct D. It is a unique combination of products, services, and experiences

Correct Answer: D

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Question 11

A company is considering launching a new product line. The marketing manager has identified three potential target markets: young adults, middle-aged adults, and seniors. The product development team has estimated the production costs and potential revenue for each target market. Which of the following marketing strategies would be most effective for the company?

Correct A. Segmentation, targeting, and positioning (STP)

B. Market penetration, market development, and market diversification (3Cs)

C. Product differentiation and market expansion

D. Brand extension and market segmentation

Correct Answer: A

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Question 12

A consumer protection agency has received complaints about a company's unfair business practices. The agency has gathered evidence of the company's actions and is considering taking legal action. Which of the following legal principles would be most relevant to this case?

A. Unfair competition

Correct B. Deceptive advertising

C. Breach of contract

D. Negligence

Correct Answer: B

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Question 13

A company is considering exporting its products to a foreign market. The company has identified several potential trade barriers, including tariffs, quotas, and non-tariff barriers. Which of the following trade agreements would be most effective in reducing these barriers?

Correct A. World Trade Organization (WTO)

B. General Agreement on Tariffs and Trade (GATT)

C. North American Free Trade Agreement (NAFTA)

D. Association of Southeast Asian Nations (ASEAN)

Correct Answer: A

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Question 14

A company is considering launching a new product line. The marketing manager has identified three potential target markets: young adults, middle-aged adults, and seniors. The product development team has estimated the production costs and potential revenue for each target market. Which of the following marketing strategies would be most effective for the company?

Correct A. Segmentation, targeting, and positioning (STP)

B. Market penetration, market development, and market diversification (3Cs)

C. Product differentiation and market expansion

D. Brand extension and market segmentation

Correct Answer: A

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Question 15

A consumer protection agency has received complaints about a company's unfair business practices. The agency has gathered evidence of the company's actions and is considering taking legal action. Which of the following legal principles would be most relevant to this case?

A. Unfair competition

Correct B. Deceptive advertising

C. Breach of contract

D. Negligence

Correct Answer: B

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Question 16

A bank's liquidity ratio is calculated as the ratio of its liquid assets to its total deposits. If a bank has liquid assets worth ₦1.2 billion and total deposits of ₦2.5 billion, what is its liquidity ratio?

Correct A. 0.48

B. 0.48

C. 0.48

D. 0.48

Correct Answer: A

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Question 17

A company's marketing strategy involves a 20% discount on all products sold during a promotional period. If a product originally costs ₦15,000, what is the selling price during the promotional period?

Correct A. ₦12,000

B. ₦12,000

C. ₦12,000

D. ₦12,000

Correct Answer: A

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Question 18

A ship's cargo capacity is 500 tons. If the ship is carrying a cargo of 300 tons of wheat and 200 tons of rice, what is the remaining capacity?

A. 0 tons

Correct B. 100 tons

C. 200 tons

D. 300 tons

Correct Answer: B

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Question 19

A company's profit is calculated as the difference between its revenue and cost. If a company has a revenue of ₦1.5 million and a cost of ₦1.2 million, what is its profit?

Correct A. ₦0.3 million

B. ₦0.3 million

C. ₦0.3 million

D. ₦0.3 million

Correct Answer: A

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Question 20

A bank's interest rate is 12% per annum. If a customer deposits ₦10,000 for 2 years, what is the interest earned?

Correct A. ₦2,400

B. ₦2,400

C. ₦2,400

D. ₦2,400

Correct Answer: A

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Question 21

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 22

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 premium?

A. ₦100,000

Correct B. ₦200,000

C. ₦300,000

D. ₦400,000

Correct Answer: B

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Question 23

A consumer purchases a product with a price of ₦5,000 and pays a 5% sales tax. What is the amount of sales tax paid?

A. ₦200

Correct B. ₦250

C. ₦300

D. ₦350

Correct Answer: B

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Question 24

A company has a fleet of 10 vehicles, including 5 cars and 5 trucks. If the company pays ₦50,000 per month for each car and ₦75,000 per month for each truck, what is the total monthly transportation cost?

A. ₦625,000

B. ₦675,000

Correct C. ₦725,000

D. ₦775,000

Correct Answer: C

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Question 25

A life insurance policy has a premium of ₦50,000 per annum. If the policyholder pays the premium for 5 years, what is the total premium paid?

A. ₦200,000

B. ₦250,000

Correct C. ₦300,000

D. ₦350,000

Correct Answer: C

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