POST UTME JOSEPH AYO BABALOLA UNIVERSITY 2020 Commerce | Objective

Are you preparing for POST UTME JOSEPH AYO BABALOLA UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2020 Commerce (Objective) questions designed to simulate the real exam environment.

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Question 1
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 always greater than the market wage.
B. The marginal revenue product of labor is always less than the market wage.
Correct C. The marginal revenue product of labor is equal to the market wage.
D. The marginal revenue product of labor is inversely related to the market wage.

Correct Answer: C

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Question 2
A company's break-even point is the point at which its total revenue equals its total fixed costs and variable costs. What is the formula for calculating the break-even point?
A. Break-even point = Fixed costs / Variable costs
Correct B. Break-even point = Total revenue / Total fixed costs
C. Break-even point = Total fixed costs + Total variable costs
D. Break-even point = Total revenue - Total fixed costs

Correct Answer: B

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Question 3
A consumer has a budget constraint of ₦1000 and a preference for two goods: A and B. The prices of goods A and B are ₦200 and ₦300 respectively. What is the consumer's optimal bundle of goods?
Correct A. (A = 2, B = 3)
B. (A = 3, B = 2)
C. (A = 4, B = 1)
D. (A = 1, B = 4)

Correct Answer: A

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Question 4
A firm's production function is given by Q = 2L^2 + 3K, where Q is output, L is labor, and K is capital. If the firm's labor and capital are fixed at 5 and 10 respectively, what is the firm's output?
A. 20
Correct B. 30
C. 40
D. 50

Correct Answer: B

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Question 5
A company's marketing mix is given by the 4 Ps: Product, Price, Place, and Promotion. What is the primary objective of the marketing mix?
A. To maximize profits
B. To increase market share
Correct C. To satisfy customer needs
D. To reduce costs

Correct Answer: C

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Question 6
In a perfectly competitive market, the supply curve is determined by the marginal cost (MC) of production. If the MC curve intersects the average variable cost (AVC) curve at point E, and the MC curve intersects the average total cost (ATC) curve at point F, what is the likely outcome for the firm?
A. The firm will shut down because the AVC is greater than the price.
Correct B. The firm will operate at point E because the AVC is less than the price.
C. The firm will operate at point F because the ATC is less than the price.
D. The firm will operate at point E because the MC is less than the price.

Correct Answer: B

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Question 7
A firm is considering two investment projects, A and B. Project A has a higher initial investment but generates a higher expected return. Project B has a lower initial investment but generates a lower expected return. Which project should the firm choose?
Correct A. Project A because it has a higher expected return.
B. Project B because it has a lower initial investment.
C. Project A because it has a higher initial investment.
D. Project B because it has a lower expected return.

Correct Answer: A

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Question 8
A consumer has a budget constraint of 100 and a preference for two goods, X and Y. The prices of X and Y are 20 and 30, respectively. If the consumer spends all of their budget on good X, what is the likely outcome for good Y?
A. The consumer will buy 5 units of good Y.
B. The consumer will buy 3 units of good Y.
Correct C. The consumer will not buy any units of good Y.
D. The consumer will buy 2 units of good Y.

Correct Answer: C

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Question 9
A firm is considering two production processes, A and B. Process A is more labor-intensive but has a lower capital requirement. Process B is more capital-intensive but has a lower labor requirement. Which process should the firm choose?
A. Process A because it has a lower capital requirement.
Correct B. Process B because it has a lower labor requirement.
C. Process A because it is more labor-intensive.
D. Process B because it is more capital-intensive.

Correct Answer: B

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Question 10
A consumer has a utility function U(X, Y) = 2X + 3Y. If the prices of X and Y are 10 and 20, respectively, and the consumer's budget is 100, what is the likely outcome for the consumer's utility?
Correct A. The consumer's utility will increase.
B. The consumer's utility will decrease.
C. The consumer's utility will remain the same.
D. The consumer's utility will increase by 10 units.

Correct Answer: A

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Question 11
A company's marketing strategy involves a mix of advertising, sales promotions, and public relations. Which of the following is a key benefit of using a mix of these strategies?
A. Increased brand awareness
B. Improved customer engagement
Correct C. Enhanced product differentiation
D. Better return on investment

Correct Answer: C

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Question 12
A firm's foreign trade involves importing raw materials and exporting finished goods. Which of the following is a key advantage of this strategy?
A. Reduced production costs
B. Increased market share
C. Improved product quality
Correct D. Enhanced supply chain efficiency

Correct Answer: D

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Question 13
A consumer protection agency is responsible for enforcing laws related to consumer rights. Which of the following is a key responsibility of this agency?
A. Investigating consumer complaints
B. Providing consumer education
Correct C. Enforcing product safety standards
D. Regulating business practices

Correct Answer: C

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Question 14
A company's business law involves contracts, torts, and property law. Which of the following is a key principle of contract law?
A. The principle of privity
Correct B. The doctrine of consideration
C. The rule of promissory estoppel
D. The concept of undue influence

Correct Answer: B

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Question 15
A firm's insurance policy involves liability insurance, property insurance, and workers' compensation insurance. Which of the following is a key benefit of liability insurance?
A. Reduced business costs
B. Improved customer satisfaction
C. Enhanced reputation
Correct D. Protection against lawsuits

Correct Answer: D

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Question 16
The Central Bank of Nigeria (CBN) uses the following monetary policy tools to control inflation: Open Market Operations (OMO), Reserve Requirement, and Moral Suasion. Which of the following is NOT a monetary policy tool?
Correct A. Fiscal Policy
B. Monetary Policy
C. Supply-Side Policy
D. Demand-Side Policy

Correct Answer: A

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Question 17
A firm's production function is given by Q = 2L^(1/2)K^(1/2), where Q is output, L is labor, and K is capital. If the firm wants to increase output by 20% while keeping labor constant, what percentage increase in capital is required?
A. 10%
Correct B. 20%
C. 30%
D. 40%

Correct Answer: B

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Question 18
A consumer has a budget constraint of 100, with two goods: X and Y. The price of good X is 5, and the price of good Y is 10. If the consumer spends 80 on good X, how much is left for good Y?
A. 10
Correct B. 20
C. 30
D. 40

Correct Answer: B

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Question 19
A company is considering two investment projects: Project A and Project B. Project A has a 10% chance of success and a 90% chance of failure, with a payoff of 100 if successful. Project B has a 20% chance of success and an 80% chance of failure, with a payoff of 150 if successful. Which project should the company choose?
A. Project A
Correct B. Project B
C. Both projects are equally attractive
D. Neither project is attractive

Correct Answer: B

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Question 20
A firm's cost function is given by C = 2L + 3K, where C is cost, L is labor, and K is capital. If the firm wants to minimize cost while keeping labor constant, what is the optimal level of capital?
A. 0
Correct B. 10
C. 20
D. 30

Correct Answer: B

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Question 21
In a perfectly competitive market, the supply curve is upward-sloping and the demand curve is downward-sloping. What is the effect of an increase in the price of a complementary good on the demand for a product?
A. The demand for the product increases.
Correct B. The demand for the product decreases.
C. The demand for the product remains unchanged.
D. The demand for the product becomes perfectly inelastic.

Correct Answer: B

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Question 22
A company is considering the introduction of a new product. The product has a high fixed cost and a low variable cost. What type of market structure is this company likely to operate in?
A. Perfect competition
Correct B. Monopoly
C. Monopolistic competition
D. Oligopoly

Correct Answer: B

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Question 23
A consumer has a budget constraint of ₦1000 and a preference for two goods, A and B. The prices of the goods are ₦200 and ₦300 respectively. What is the consumer's optimal bundle of goods?
A. 1 unit of A and 2 units of B
Correct B. 2 units of A and 1 unit of B
C. 3 units of A and 0 units of B
D. 0 units of A and 3 units of B

Correct Answer: B

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Question 24
A firm is producing a good with a total revenue of ₦1200 and a total cost of ₦800. What is the firm's profit?
A. ₦200
Correct B. ₦400
C. ₦600
D. ₦800

Correct Answer: B

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Question 25
A company is considering the introduction of a new product. The product has a high fixed cost and a low variable cost. What type of market structure is this company likely to operate in?
A. Perfect competition
Correct B. Monopoly
C. Monopolistic competition
D. Oligopoly

Correct Answer: B

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