POST UTME CALEB UNIVERSITY 2025 Commerce | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A bank is considering two different investment options. Option A has a return of 10% per annum and a risk level of 5. Option B has a return of 15% per annum and a risk level of 8. If the bank has a risk tolerance of 6, which option should it choose?
A. Option A
B. Option B
C. Both options are equally risky
D. Neither option is suitable
Question 2
A company uses the weighted average cost of capital (WACC) method to evaluate investment projects. If the WACC is 12% and the project's expected return is 15%, what is the expected return on investment?
A. 3%
B. 5%
C. 7%
D. 9%
Question 3
A firm is considering a new product launch. The product has a fixed cost of ₦500,000 and a variable cost of ₦200 per unit. If the firm expects to sell 10,000 units of the product, what is the total cost of production?
A. ₦2,500,000
B. ₦3,000,000
C. ₦3,500,000
D. ₦4,000,000
Question 4
A firm is considering two different production processes to produce a certain good. Process A requires an initial investment of ₦100,000 and has a fixed cost of ₦50,000 per unit produced. Process B requires an initial investment of ₦150,000 and has a fixed cost of ₦30,000 per unit produced. If the firm produces 10 units of the good, what is the total cost of production for each process?
A. Process A: ₦500,000; Process B: ₦350,000
B. Process A: ₦450,000; Process B: ₦320,000
C. Process A: ₦550,000; Process B: ₦380,000
D. Process A: ₦650,000; Process B: ₦480,000
Question 5
In a perfectly competitive market, what is the relationship between the marginal revenue product of labor and the market wage?
A. The marginal revenue product of labor is greater than the market wage.
B. The marginal revenue product of labor is less than the market wage.
C. The marginal revenue product of labor is equal to the market wage.
D. The marginal revenue product of labor is unrelated to the market wage.
Question 6
A sole trader is a type of business ownership where one person owns and operates the business. What is the main advantage of being a sole trader?
A. Easy to set up and operate
B. High level of control and decision-making
C. Limited financial risk
D. Ability to raise capital from investors
Question 7
A company is considering launching a new product line. The product's expected profit is ₦1,500,000, and the initial investment is ₦2,000,000. If the company's cost of capital is 12% per annum, what is the internal rate of return (IRR) of the project?
A. 15%
B. 12%
C. 18%
D. 20%
Question 8
A consumer is considering purchasing a product that has a warranty period of 2 years. However, the consumer is also considering the cost of repairing the product if it breaks down during the warranty period. What is the total cost of the product to the consumer?
A. The cost of the product plus the cost of repairing the product.
B. The cost of the product minus the cost of repairing the product.
C. The cost of the product plus the warranty period.
D. The cost of the product minus the warranty period.
Question 9
A company is considering expanding its operations to a new market. However, the company is concerned about the potential risks associated with entering a new market. What is the primary risk that the company should be concerned about?
A. The risk of losing market share to competitors.
B. The risk of not being able to adapt to the new market.
C. The risk of not being able to manage the company's finances effectively.
D. The risk of not being able to manage the company's human resources effectively.
Question 10
A company is considering two different marketing strategies. Strategy A involves a high level of advertising and a low level of sales promotion. Strategy B involves a low level of advertising and a high level of sales promotion. If the company has a budget of ₦100,000, which strategy should it choose?
A. Strategy A
B. Strategy B
C. Both strategies are equally effective
D. Neither strategy is suitable
Question 11
A company's break-even point is the point at which its total revenue equals its
A. fixed costs
B. variable costs
C. total costs
D. net income
Question 12
A firm's insurance policy has a deductible of ₦5,000. If the firm's annual premium is ₦50,000, what is the expected value of the insurance policy?
A. ₦45,000
B. ₦50,000
C. ₦55,000
D. ₦60,000
Question 13
A company's marketing mix consists of product, price, place, and promotion. Which of the following is NOT a component of the marketing mix?
A. Product
B. Price
C. Place
D. Research and Development
Question 14
A company's sole trader has a warehouse with a capacity of 10,000 units. If the company's average stock level is 8,000 units, what is the probability that the stock level will exceed 9,000 units?
A. 0.2
B. 0.4
C. 0.6
D. 0.8
Question 15
A firm is considering two investment projects, X and Y. Project X has a net present value (NPV) of ₦100,000 and a payback period of 5 years. Project Y has an NPV of ₦120,000 and a payback period of 4 years. Which project should the firm choose?
A. Project X
B. Project Y
C. Both projects are equally attractive
D. Neither project is attractive

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