POST UTME COVENANT UNIVERSITY 2022 Commerce | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A company is considering two different production processes for its new product. Process A requires an initial investment of ₦10 million and generates revenue of ₦5 million per unit sold. Process B requires an initial investment of ₦15 million and generates revenue of ₦7 million per unit sold. If the company expects to sell 10,000 units of the product, which process should it choose?
A. Process A
B. Process B
C. Both processes are equally profitable
D. Neither process is profitable
Question 2
A company is considering launching a new product. The market research indicates that the demand for the product will be 100 units in the first year, increasing by 20% each year for the next 5 years. If the company wants to maximize its profits, what should it do?
A. Launch the product immediately
B. Delay the launch for 2 years
C. Delay the launch for 5 years
D. Do not launch the product
Question 3
In a sole trade business, the owner's personal assets are not protected from business liabilities. What is the primary reason for this lack of protection?
A. The owner's personal assets are not registered as business assets.
B. The business is not registered as a separate legal entity.
C. The owner has not obtained business insurance.
D. The owner has not filed tax returns.
Question 4
A bank has a reserve requirement of 10% and a cash reserve ratio of 20%. If the bank has 100 million naira in deposits, how much cash and reserves should the bank hold?
A. ₦20 million cash and ₦10 million reserves
B. ₦30 million cash and ₦15 million reserves
C. ₦40 million cash and ₦20 million reserves
D. ₦50 million cash and ₦25 million reserves
Question 5
A firm's cost function is given by the equation ( C = 2L + 3K ), where C is the cost, L is the number of labor units, and K is the number of capital units. If the firm wants to minimize its cost, how many labor units should it use if the capital units are 4?
A. 2
B. 4
C. 6
D. 8
Question 6
A company uses a just-in-time (JIT) inventory system to manage its inventory. The company receives a shipment of 1,000 units and already has 500 units in stock. What is the new stock level?
A. 1,000
B. 1,500
C. 2,000
D. 2,500
Question 7
A company is considering two different production processes. Process A requires 2 hours of labor and 1 hour of capital, while Process B requires 1 hour of labor and 2 hours of capital. If the company has 10 hours of labor and 10 hours of capital available, how many units of output can it produce using Process A?
A. 5
B. 10
C. 15
D. 20
Question 8
A firm is considering two marketing strategies: one that involves a high level of advertising and another that involves a low level of advertising. If the firm's objective is to maximize its sales revenue, which marketing strategy should it adopt?
A. High advertising strategy
B. Low advertising strategy
C. Both strategies are equally effective
D. Neither strategy is effective
Question 9
A company has a production function given by ( Q = 2L^0.5K^{0.5} ), where Q is the quantity produced and L and K are the inputs labor and capital, respectively. If the company has 100 units of labor and 50 units of capital, how much should the company produce?
A. 20
B. 30
C. 40
D. 50
Question 10
A firm is considering exporting its product to a foreign market. The firm's marketing manager has identified a potential customer in the foreign market who is willing to pay a price of 10 per unit. The firm's production costs are ₦5 million per unit, and the exchange rate is 1 USD = 500 Naira. What should the firm do?
A. Export the product to the foreign market
B. Do not export the product to the foreign market
C. Negotiate a higher price with the customer
D. Increase production costs to match the foreign market price
Question 11
A company is considering two different production processes for its new product. Process A requires an initial investment of ₦10 million and generates revenue of ₦5 million per unit sold. Process B requires an initial investment of ₦15 million and generates revenue of ₦7 million per unit sold. If the company expects to sell 10,000 units of the product, which process should it choose?
A. Process A
B. Process B
C. Both processes are equally profitable
D. Neither process is profitable
Question 12
A bank is considering offering a new type of loan to its customers. The loan will have a variable interest rate that is tied to the prime lending rate. Which of the following is a potential risk associated with this type of loan?
A. The borrower may default on the loan.
B. The interest rate may increase rapidly.
C. The borrower may not be able to afford the loan payments.
D. The bank may not be able to recover the loan amount.
Question 13
A company has a fleet of vehicles that are used for transportation. The company's insurance policy has a deductible of ₦50,000. If the company incurs a loss of ₦200,000, what is the amount that the company will have to pay out of pocket?
A. ₦0
B. ₦50,000
C. ₦100,000
D. ₦150,000
Question 14
A company is considering outsourcing its logistics operations to a third-party provider. If the company's objective is to minimize its costs, what should it do?
A. Outsource the logistics operations
B. Do not outsource the logistics operations
C. Both options are equally cost-effective
D. Neither option is cost-effective
Question 15
A company uses a last-in-first-out (LIFO) inventory system to manage its inventory. The company receives a shipment of 1,000 units and already has 500 units in stock. What is the new stock level?
A. 1,000
B. 1,500
C. 2,000
D. 2,500

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