POST UTME FUTO 2020 Commerce | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A firm is considering expanding its production capacity to meet increasing demand. However, the expansion would require a significant investment in new equipment and labor. What is the opportunity cost of this expansion?
A. The opportunity cost is the cost of producing one more unit of the good.
B. The opportunity cost is the cost of producing the entire new capacity.
C. The opportunity cost is the cost of producing the entire new capacity plus the cost of producing one more unit.
D. The opportunity cost is the cost of producing the entire new capacity minus the cost of producing one more unit.
Question 2
A sole trader has a business income of ₦500,000 and expenses of ₦200,000. What is the sole trader's profit?
A. ₦300,000
B. ₦200,000
C. ₦500,000
D. ₦300,000
Question 3
A bank is considering offering a new credit product to its customers. Which of the following is a key consideration for the bank?
A. The bank's risk appetite and credit risk assessment.
B. The bank's pricing strategy and interest rates.
C. The bank's ability to manage and monitor the credit product.
D. The bank's decision to use a third-party credit scoring agency.
Question 4
In a perfectly competitive market, the law of diminishing marginal utility implies that the demand curve for a firm's product is likely to be
A. inelastic
B. elastic
C. unit elastic
D. perfectly inelastic
Question 5
The Consumer Protection Act of 1999 in Nigeria provides for the protection of consumers from unfair trade practices. Which of the following is a key provision of the Act?
A. The Act prohibits the use of false or misleading advertisements.
B. The Act requires businesses to provide clear and accurate information about their products and services.
C. The Act allows consumers to sue businesses for damages caused by unfair trade practices.
D. The Act establishes a consumer protection agency to regulate businesses and enforce consumer rights.
Question 6
In a perfectly competitive market, the law of supply states that as the price of a commodity increases, the quantity supplied will increase. However, this increase in quantity supplied is subject to a limit imposed by the law of diminishing marginal utility. Explain how the law of diminishing marginal utility affects the supply curve in a perfectly competitive market.
A. The law of diminishing marginal utility causes the supply curve to shift to the left.
B. The law of diminishing marginal utility causes the supply curve to shift to the right.
C. The law of diminishing marginal utility causes the supply curve to become perfectly elastic.
D. The law of diminishing marginal utility has no effect on the supply curve.
Question 7
A company's production function is given by Q = 2L^0.5 K^0.5. If the company wants to increase its output by 20% and the wage rate is ₦100 per hour, what is the minimum amount of capital it needs to invest?
A. ₦500
B. ₦1000
C. ₦2000
D. ₦5000
Question 8
A firm has the following cost function: C(x)=2x^2+3x+1. If the firm produces x units of the product, what is the marginal cost?
A. 4x+3
B. 2x+1
C. 6x+2
D. 8x+4
Question 9
A company is considering investing in a new project that has a high potential return but also carries a high level of risk. What is the primary consideration for the company when evaluating this investment?
A. The potential return on investment.
B. The level of risk associated with the investment.
C. The time horizon for the investment.
D. The cost of capital for the investment.
Question 10
A warehouse has a storage capacity of 10,000 units. If the warehouse is currently storing 8,000 units, what is the remaining storage capacity?
A. 2,000
B. 8,000
C. 10,000
D. 12,000
Question 11
A bank's financial statements are prepared in accordance with the Generally Accepted Accounting Principles (GAAP). Which of the following is a key principle of GAAP?
A. Accounting entity principle
B. Going concern principle
C. Matching principle
D. Materiality principle
Question 12
A sole trader's business is considered a separate legal entity from its owner. What is the primary reason for this separation?
A. To limit the owner's personal liability
B. To facilitate the transfer of ownership
C. To simplify tax compliance
D. To enhance business credibility
Question 13
A marketing campaign for a new product involves a combination of advertising, sales promotions, and public relations. Which of the following is a key objective of the campaign?
A. To increase brand awareness and create a buzz around the product.
B. To drive sales and revenue growth for the company.
C. To build customer loyalty and retention.
D. To launch a new product line and expand the company's offerings.
Question 14
A firm has the following revenue function: R(x)=3x^2+2x+1. If the firm produces x units of the product, what is the rate of change of revenue?
A. 6x+2
B. 4x+1
C. 8x+3
D. 10x+5
Question 15
A firm's revenue function is given by R = 100x - 2x^2. If the firm wants to maximize its revenue, what is the optimal level of production?
A. 20 units
B. 30 units
C. 40 units
D. 50 units

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