POST UTME CRAWFORD UNIVERSITY 2018 Commerce | Objective

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Question 1
A consumer's budget constraint is given by P1X + P2Y = I, where P1 and P2 are the prices of the two goods, X and Y are the quantities consumed, and I is the consumer's income. If the consumer's income is ₦1000, the price of good X is ₦200, and the price of good Y is ₦300, what is the maximum amount of good Y the consumer can buy?
A. 1
B. 2
C. 3
D. 4
Question 2
A company is considering launching a new product in a market where there are already several similar products. What type of market structure is this?
A. Perfect competition, because there are many buyers and sellers.
B. Monopoly, because there is only one seller.
C. Oligopoly, because there are a few large sellers.
D. Monopolistic competition, because there are many sellers and each seller has some degree of market power.
Question 3
A firm's production function is given by Q = 2L^(1/2)K^(1/2). If the firm's current labor and capital inputs are L = 16 and K = 9, respectively, what is the firm's current output?
A. 32
B. 64
C. 128
D. 256
Question 4
The Insurance Act of 2003 provides a framework for the insurance industry in Nigeria. What is one of the types of insurance policies that can be issued under this Act?
A. Life insurance
B. General insurance
C. Health insurance
D. Travel insurance
Question 5
A foreign trade agreement between two countries involves the exchange of goods and services. Explain the concept of comparative advantage and how it applies to international trade.
A. Comparative advantage refers to a country's ability to produce a good or service at a lower opportunity cost than another country
B. Comparative advantage refers to a country's ability to produce a good or service at a higher opportunity cost than another country
C. Comparative advantage refers to a country's ability to produce a good or service at the same opportunity cost as another country
D. Comparative advantage refers to a country's ability to produce a good or service at a lower price than another country
Question 6
A company's insurance policy has a deductible of ₦1000. If a claim of ₦5000 is made, the amount paid by the insurer is
A. ₦4000
B. ₦3000
C. ₦2000
D. ₦1000
Question 7
In a perfectly competitive market, the law of supply states that as the price of a good increases, the quantity supplied will
A. increase
B. decrease
C. remain constant
D. move in the opposite direction
Question 8
A sole trader's business is considered a separate legal entity from its owner. Discuss.
A. True
B. False
C. Depends on the type of business
D. Not applicable
Question 9
In a sole trader business, what is the primary advantage of using a sole proprietorship structure?
A. Limited liability
B. Easy to set up
C. Flexibility in decision-making
D. No tax benefits
Question 10
A company's Memorandum of Association is a legal document that outlines the company's objectives and powers. Explain.
A. True
B. False
C. Depends on the type of company
D. Not applicable
Question 11
A firm's demand function is given by Q = 100 - 2P. If the firm's current price is ₦50, what is the maximum amount of revenue it can generate?
A. ₦1000
B. ₦2000
C. ₦3000
D. ₦4000
Question 12
A company has a capital structure consisting of 60% debt and 40% equity. If the company's cost of debt is 8% and the cost of equity is 12%, what is the company's weighted average cost of capital (WACC)?
A. 6%
B. 8%
C. 10%
D. 12%
Question 13
A consumer's indifference curve is given by U = 2X + 3Y. If the consumer's current consumption is X = 2 units and Y = 3 units, what is the maximum amount of utility the consumer can achieve?
A. 13
B. 15
C. 17
D. 19
Question 14
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. Limited liability
B. Unlimited liability
C. Easy to set up
D. Flexibility in decision-making
Question 15
A firm's revenue function is given by R = 100Q - 2Q^2. If the firm's current price is 10 per unit, what is the firm's current revenue?
A. 1000
B. 2000
C. 3000
D. 4000

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