POST UTME BELLS UNIVERSITY 2025 Commerce | Objective

Are you preparing for POST UTME BELLS UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2025 Commerce (Objective) questions designed to simulate the real exam environment.

Practice these randomly selected questions to test your readiness.

Question 1
In a perfectly competitive market, the demand curve for a firm's product is its
Correct A. marginal revenue curve
B. marginal cost curve
C. average revenue curve
D. average cost curve

Correct Answer: A

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Question 2
A firm's break-even point is the point at which its
A. total revenue equals its total fixed costs
B. total revenue equals its total variable costs
Correct C. total revenue equals its total fixed and variable costs
D. total revenue equals its total contribution margin

Correct Answer: C

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Question 3
A warehouse's inventory turnover ratio is calculated as
Correct A. Cost of goods sold ÷ Average inventory
B. Average inventory ÷ Cost of goods sold
C. Average inventory ÷ Sales
D. Sales ÷ Average inventory

Correct Answer: A

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Question 4
A bank's cash reserve ratio is the ratio of its
Correct A. total deposits to its total cash reserves
B. total cash reserves to its total deposits
C. total loans to its total deposits
D. total investments to its total deposits

Correct Answer: A

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Question 5
A firm's risk management strategy involves identifying and assessing
Correct A. all possible risks
B. only financial risks
C. only operational risks
D. only strategic risks

Correct Answer: A

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Question 6
A company is considering two different production methods for its new product. Method A involves a higher initial investment but lower production costs, while Method B involves a lower initial investment but higher production costs. Which method should the company choose if it expects to produce 10,000 units per year for the next 5 years?
Correct A. Method A
B. Method B
C. Method C
D. Method D

Correct Answer: A

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Question 7
A firm is considering launching a new product in a foreign market. The product has a high demand in the target market, but the firm is concerned about the high transportation costs. What is the best way for the firm to minimize its transportation costs?
A. Use a freight forwarder
B. Use a shipping company
C. Use a logistics company
Correct D. Use a combination of the above

Correct Answer: D

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Question 8
A company is considering two different marketing strategies for its new product. Strategy A involves a high level of advertising and promotion, while Strategy B involves a low level of advertising and promotion. Which strategy should the company choose if it expects to sell 10,000 units per year for the next 5 years?
Correct A. Strategy A
B. Strategy B
C. Strategy C
D. Strategy D

Correct Answer: A

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Question 9
A firm is considering launching a new product in a foreign market. The product has a high demand in the target market, but the firm is concerned about the high transportation costs. What is the best way for the firm to minimize its transportation costs?
A. Use a freight forwarder
B. Use a shipping company
C. Use a logistics company
Correct D. Use a combination of the above

Correct Answer: D

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Question 10
A company is considering two different production methods for its new product. Method A involves a higher initial investment but lower production costs, while Method B involves a lower initial investment but higher production costs. Which method should the company choose if it expects to produce 10,000 units per year for the next 5 years?
Correct A. Method A
B. Method B
C. Method C
D. Method D

Correct Answer: A

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Question 11
The concept of specialization in production is closely related to the idea of comparative advantage. Explain how specialization leads to increased productivity and efficiency in production.
A. Specialization leads to increased productivity and efficiency in production by allowing firms to focus on producing a specific good or service, thereby reducing production costs and increasing output.
B. Specialization leads to decreased productivity and efficiency in production by forcing firms to produce a limited range of goods or services, thereby reducing output and increasing costs.
C. Specialization has no impact on productivity and efficiency in production, as firms can still produce a wide range of goods or services.
Correct D. Specialization leads to increased productivity and efficiency in production by allowing firms to take advantage of economies of scale, thereby reducing production costs and increasing output.

Correct Answer: D

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Question 12
A firm is considering two different production processes for producing a particular good. Process A requires an initial investment of ₦10,000 and has a variable cost of ₦5 per unit produced. Process B requires an initial investment of ₦20,000 and has a variable cost of ₦3 per unit produced. If the firm produces 1,000 units of the good, which production process should it choose?
A. Process A, as it has a lower variable cost per unit produced.
Correct B. Process B, as it has a lower total cost for producing 1,000 units.
C. Process A, as it has a lower initial investment.
D. Process B, as it has a higher initial investment but a lower variable cost per unit produced.

Correct Answer: B

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Question 13
A consumer is considering purchasing a product that has a price of ₦1,500. The consumer's budget for the product is ₦1,200. What is the consumer's opportunity cost of purchasing the product?
Correct A. ₦300
B. ₦500
C. ₦700
D. ₦900

Correct Answer: A

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Question 14
A firm is considering launching a new product in a market where there are already several established brands. The firm's marketing manager has estimated that the new product will have a market share of 10% in the first year, increasing to 20% in the second year. What is the firm's expected revenue from the new product in the second year?
A. ₦1,000,000
B. ₦1,200,000
Correct C. ₦1,500,000
D. ₦2,000,000

Correct Answer: C

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Question 15
A consumer is considering purchasing a product that has a price of ₦2,000. The consumer's budget for the product is ₦1,800. What is the consumer's opportunity cost of purchasing the product?
Correct A. ₦200
B. ₦400
C. ₦600
D. ₦800

Correct Answer: A

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Question 16
A firm is considering launching a new product in a market where there are already several established brands. The firm's marketing manager has estimated that the new product will have a market share of 15% in the first year, increasing to 25% in the second year. What is the firm's expected revenue from the new product in the second year?
A. ₦1,500,000
B. ₦1,800,000
Correct C. ₦2,200,000
D. ₦2,500,000

Correct Answer: C

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Question 17
A consumer is considering purchasing a product that has a price of ₦1,000. The consumer's budget for the product is ₦900. What is the consumer's opportunity cost of purchasing the product?
Correct A. ₦100
B. ₦200
C. ₦300
D. ₦400

Correct Answer: A

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Question 18
A firm is considering launching a new product in a market where there are already several established brands. The firm's marketing manager has estimated that the new product will have a market share of 20% in the first year, increasing to 30% in the second year. What is the firm's expected revenue from the new product in the second year?
A. ₦2,000,000
B. ₦2,500,000
Correct C. ₦3,000,000
D. ₦3,500,000

Correct Answer: C

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Question 19
In a perfectly competitive market, the supply curve is horizontal and the demand curve is downward-sloping. What is the equilibrium price and quantity of a commodity in this market?
Correct A. ₦100, 100 units
B. ₦120, 80 units
C. ₦150, 60 units
D. ₦180, 40 units

Correct Answer: A

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Question 20
A company's production function is given by Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the company uses 100 units of labor and 400 units of capital, what is the quantity produced?
A. 100
Correct B. 200
C. 300
D. 400

Correct Answer: B

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Question 21
A consumer has a budget of ₦1000 and a preference for two goods, A and B. The prices of the goods are ₦200 and ₦300 respectively. Using the budget constraint, what is the maximum quantity of good A that the consumer can buy?
A. 2
Correct B. 3
C. 4
D. 5

Correct Answer: B

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Question 22
A company is considering two different production processes to produce a product. Process A requires an initial investment of ₦100,000 and has a variable cost of ₦50 per unit produced. Process B requires an initial investment of ₦150,000 and has a variable cost of ₦30 per unit produced. If the company produces 1000 units of the product, what is the total cost of production for each process?
Correct A. Process A: ₦150,000, Process B: ₦120,000
B. Process A: ₦120,000, Process B: ₦150,000
C. Process A: ₦100,000, Process B: ₦100,000
D. Process A: ₦150,000, Process B: ₦150,000

Correct Answer: A

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Question 23
A company's marketing strategy involves a 10% discount on all products sold during a promotional period. If the original price of a product is ₦1000, what is the new price after the discount?
Correct A. ₦900
B. ₦950
C. ₦1000
D. ₦1050

Correct Answer: A

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Question 24
In a perfectly competitive market, the law of diminishing marginal utility leads to the production of a good at which point?
A. The point where marginal revenue equals marginal cost
Correct B. The point where marginal utility equals marginal cost
C. The point where marginal revenue equals average revenue
D. The point where marginal cost equals average revenue

Correct Answer: B

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Question 25
A company's financial statements show a decrease in its current ratio from 2.5 to 2.0 over the past year. What does this indicate?
A. The company's liquidity has improved
Correct B. The company's liquidity has decreased
C. The company's solvency has improved
D. The company's solvency has decreased

Correct Answer: B

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