Practice post utme joseph ayo babalola university commerce 2022 Past Questions

Question 1

A firm's production function is given by Q = 2L^0.5H^0.5, where Q is the quantity produced, L is the number of laborers, and H is the number of machines. If the firm wants to produce 16 units of output, and it has 4 laborers, how many machines (H) should it hire?

A. 4

B. 8

Correct C. 16

D. 32

Correct Answer: C

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Question 2

A company is considering two different production processes for manufacturing a product. Process A has a fixed cost of ₦100,000 and a variable cost of ₦50 per unit. Process B has a fixed cost of ₦150,000 and a variable cost of ₦30 per unit. If the company wants to produce 1,000 units, which process should it choose?

Correct A. Process A

B. Process B

C. Both processes are equally profitable

D. Neither process is profitable

Correct Answer: A

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Question 3

A firm's demand function is given by Q = 100 - 2P, where Q is the quantity demanded and P is the price. If the firm wants to maximize its revenue, what price should it charge?

A. ₦20

Correct B. ₦25

C. ₦30

D. ₦35

Correct Answer: B

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Question 4

A company is considering two different marketing strategies for promoting a new product. Strategy A involves a one-time advertising expenditure of ₦500,000, while Strategy B involves a monthly advertising expenditure of ₦50,000 for 12 months. If the company wants to minimize its total advertising expenditure, which strategy should it choose?

A. Strategy A

Correct B. Strategy B

C. Both strategies are equally expensive

D. Neither strategy is cost-effective

Correct Answer: B

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Question 5

A firm's production function is given by Q = 2L^0.5H^0.5, where Q is the quantity produced, L is the number of laborers, and H is the number of machines. If the firm wants to produce 16 units of output, and it has 4 laborers, how many machines (H) should it hire?

A. 4

B. 8

Correct C. 16

D. 32

Correct Answer: C

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Question 6

The concept of comparative advantage in international trade is based on the idea that countries should specialize in producing goods for which they have a lower opportunity cost. Which of the following is a correct example of comparative advantage?

A. Country A produces 100 units of wheat and 50 units of cloth, while Country B produces 50 units of wheat and 100 units of cloth.

B. Country A produces 100 units of wheat and 50 units of cloth, while Country B produces 50 units of wheat and 150 units of cloth.

Correct C. Country A produces 100 units of wheat and 50 units of cloth, while Country B produces 150 units of wheat and 50 units of cloth.

D. Country A produces 100 units of wheat and 50 units of cloth, while Country B produces 50 units of wheat and 50 units of cloth.

Correct Answer: C

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Question 7

A company has a warehouse with a capacity to store 1000 units of goods. The warehouse is currently storing 500 units of goods. If the company receives an order for 200 units of goods, what is the maximum number of units that can be stored in the warehouse?

Correct A. 600

B. 700

C. 800

D. 900

Correct Answer: A

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Question 8

A consumer protection agency has received a complaint about a company that is selling a product with a misleading label. The label claims that the product is 100% natural, but the agency has found that it contains 20% artificial ingredients. What is the maximum penalty that the agency can impose on the company?

A. ₦100,000

B. ₦500,000

C. ₦1,000,000

Correct D. ₦5,000,000

Correct Answer: D

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Question 9

A transport company has a fleet of 10 trucks, each with a capacity to carry 20 tons of goods. If the company receives an order for 200 tons of goods, how many trucks will be required to fulfill the order?

A. 5

Correct B. 6

C. 7

D. 8

Correct Answer: B

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Question 10

A communication company has a network of 1000 subscribers. If the company wants to increase its subscriber base by 20%, how many new subscribers will it need to add?

A. 100

Correct B. 200

C. 300

D. 400

Correct Answer: B

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Question 11

A company's sole trader is considering purchasing a liability insurance policy to cover potential losses from a lawsuit. The policy has a premium of ₦50,000 and a deductible of ₦20,000. If the company is sued and the lawsuit results in a judgment of ₦150,000, what is the company's net loss if it purchases the insurance policy?

Correct A. ₦30,000

B. ₦50,000

C. ₦70,000

D. ₦90,000

Correct Answer: A

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Question 12

A producer of goods uses a production function that exhibits increasing returns to scale. If the producer increases the quantity of labor from 100 units to 120 units, and the quantity of capital from 50 units to 60 units, what is the percentage change in output?

A. 10%

Correct B. 15%

C. 20%

D. 25%

Correct Answer: B

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Question 13

A company's marketing manager is considering a new advertising campaign that will increase sales by 10% in the first year, 15% in the second year, and 20% in the third year. If the company's current sales are ₦1,000,000, what is the total sales revenue after three years?

A. ₦1,900,000

B. ₦2,100,000

Correct C. ₦2,300,000

D. ₦2,500,000

Correct Answer: C

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Question 14

A firm's production function is given by the equation Q = 2L^2 + 3K, where Q is output, L is labor, and K is capital. If the firm increases labor from 4 units to 6 units, and capital from 2 units to 3 units, what is the new level of output?

A. 40

B. 50

Correct C. 60

D. 70

Correct Answer: C

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Question 15

A firm's cost function is given by the equation C = 2L + 3K, where C is cost, L is labor, and K is capital. If the firm increases labor from 4 units to 6 units, and capital from 2 units to 3 units, what is the new level of cost?

A. ₦20

B. ₦30

Correct C. ₦40

D. ₦50

Correct Answer: C

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Question 16

A firm's production function is given by Q = 2L^0.5H^0.5, where Q is output, L is labor, and H is capital. If the firm wants to increase output by 20% while keeping labor constant at 100 units, what percentage increase in capital is required?

A. 10%

Correct B. 20%

C. 30%

D. 40%

Correct Answer: B

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Question 17

A consumer has a budget constraint of 1000, with two goods, A and B. The prices of A and B are 5 and 3 respectively. If the consumer's indifference curve is given by U = 2x^0.5y^0.5, where x is the quantity of A and y is the quantity of B, what is the consumer's optimal bundle?

A. x = 40, y = 60

B. x = 50, y = 50

Correct C. x = 60, y = 40

D. x = 70, y = 30

Correct Answer: C

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Question 18

A firm's cost function is given by C = 100 + 2L + 3H, where C is cost, L is labor, and H is capital. If the firm wants to minimize cost while producing 100 units of output, what is the optimal level of labor?

A. 20

B. 30

Correct C. 40

D. 50

Correct Answer: C

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Question 19

A consumer has a utility function given by U = 2x^0.5y^0.5, where x is the quantity of good A and y is the quantity of good B. The prices of A and B are 5 and 3 respectively. If the consumer's income is 1000, what is the consumer's optimal bundle?

A. x = 40, y = 60

B. x = 50, y = 50

Correct C. x = 60, y = 40

D. x = 70, y = 30

Correct Answer: C

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Question 20

A firm's production function is given by Q = 2L^0.5H^0.5, where Q is output, L is labor, and H is capital. If the firm wants to increase output by 20% while keeping labor constant at 100 units, what percentage increase in capital is required?

A. 10%

Correct B. 20%

C. 30%

D. 40%

Correct Answer: B

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Question 21

In a just-in-time (JIT) inventory system, what is the primary goal of the warehouse manager?

A. To minimize inventory costs

B. To maximize storage capacity

Correct C. To reduce lead times

D. To increase product variety

Correct Answer: C

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Question 22

A company has a warehouse with a capacity of 10,000 units. The current inventory level is 8,000 units. If the company receives a new shipment of 2,000 units, what is the new inventory level?

A. 6,000 units

B. 8,000 units

C. 10,000 units

Correct D. 12,000 units

Correct Answer: D

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Question 23

A bank offers a 5-year fixed deposit account with an interest rate of 10% per annum compounded annually. If the initial deposit is ₦100,000, what is the future value of the investment after 5 years?

Correct A. ₦163,918.62

B. ₦164,918.62

C. ₦165,918.62

D. ₦166,918.62

Correct Answer: A

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Question 24

A company uses the transportation cost model to determine the optimal shipping route. The model is based on the following equation: TC = f(Q) + c * Q, where TC is the total cost, f(Q) is the fixed cost, c is the variable cost per unit, and Q is the quantity shipped. If the fixed cost is ₦500, the variable cost per unit is ₦10, and the quantity shipped is 100 units, what is the total cost?

A. ₦1,500

Correct B. ₦1,600

C. ₦1,700

D. ₦1,800

Correct Answer: B

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Question 25

A firm exports 80% of its production to foreign markets. If the firm's total production is 10,000 units, how many units are exported?

Correct A. 8,000 units

B. 9,000 units

C. 10,000 units

D. 11,000 units

Correct Answer: A

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