POST UTME KSU 2020 Commerce | Objective

Are you preparing for POST UTME KSU 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.

Practice these randomly selected questions to test your readiness.

Question 1
A sole trader's business is registered under which of the following?
A. Partnership
B. Limited Liability Company
Correct C. Sole Proprietorship
D. Cooperative Society

Correct Answer: C

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Question 2
A bank's cash reserve ratio is 10%. If the bank has a total deposit of ₦100,000,000, how much cash must it reserve?
Correct A. ₦10,000,000
B. ₦9,000,000
C. ₦8,000,000
D. ₦7,000,000

Correct Answer: A

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Question 3
A company's inventory turnover ratio is 5 times. If its average inventory is ₦500,000, what is its total sales?
Correct A. ₦2,500,000
B. ₦2,000,000
C. ₦1,500,000
D. ₦1,000,000

Correct Answer: A

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Question 4
A marketing manager wants to increase sales by 20% using the 4 Ps of marketing. Which of the following is NOT one of the 4 Ps?
A. Product
B. Price
C. Promotion
Correct D. Distribution

Correct Answer: D

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Question 5
A company uses the just-in-time (JIT) inventory system. Which of the following is a characteristic of JIT?
A. High inventory levels
Correct B. Low inventory levels
C. Long lead times
D. Short production runs

Correct Answer: B

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Question 6
A company's production function is given by Q = 100L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the company increases its labor input from 4 to 9 units, and its capital input from 16 to 25 units, by how many percentage points will its quantity produced increase?
A. 10%
B. 15%
Correct C. 20%
D. 25%

Correct Answer: C

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Question 7
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's marginal revenue is 50, what is its price elasticity of demand?
A. -0.5
Correct B. -1
C. -2
D. -5

Correct Answer: B

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Question 8
A company's cost function is given by C = 100L + 200K, where C is the total cost, L is the labor input, and K is the capital input. If the company increases its labor input from 4 to 9 units, and its capital input from 16 to 25 units, by how much will its total cost increase?
A. ₦500
B. ₦1000
Correct C. ₦2000
D. ₦5000

Correct Answer: C

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Question 9
A firm's production function is given by Q = 100L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the firm's marginal product of labor is 10, what is its marginal product of capital?
A. 5
Correct B. 10
C. 15
D. 20

Correct Answer: B

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Question 10
A company's revenue function is given by R = 100Q - 2Q^2, where R is the total revenue and Q is the quantity sold. If the company sells 10 units, what is its marginal revenue?
A. ₦100
Correct B. ₦200
C. ₦300
D. ₦400

Correct Answer: B

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Question 11
The concept of risk management in insurance is closely related to the idea of diversification. Explain how diversification can help reduce risk in an insurance portfolio.
Correct A. Diversification can help reduce risk by spreading investments across different asset classes.
B. Diversification can help reduce risk by investing in a single asset class with a high potential for growth.
C. Diversification can help reduce risk by reducing the overall value of the portfolio.
D. Diversification can help reduce risk by increasing the overall value of the portfolio.

Correct Answer: A

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Question 12
A company has a cash reserve of ₦1,000,000 and wants to invest in a project that requires an initial investment of ₦500,000. If the project has a 20% chance of success and a 10% chance of failure, what is the expected value of the project?
A. ₦750,000
Correct B. ₦850,000
C. ₦950,000
D. ₦1,050,000

Correct Answer: B

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Question 13
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' when in fact it contains artificial ingredients. What is the legal consequence of this action?
A. The company can be fined up to ₦1,000,000.
B. The company can be sued for damages up to ₦5,000,000.
C. The company can be shut down for a period of 6 months.
Correct D. The company can be required to recall the product.

Correct Answer: D

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Question 14
A bank has a loan portfolio with a total value of ₦10,000,000. The bank wants to diversify its portfolio by investing in a new asset class. If the new asset class has a potential return of 15% and a standard deviation of 20%, what is the expected return on investment?
A. 15%
Correct B. 18%
C. 20%
D. 22%

Correct Answer: B

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Question 15
A company has a business plan to expand its operations into a new market. The company has identified a potential competitor that has a market share of 30%. If the company wants to increase its market share by 10%, what is the minimum number of customers it needs to acquire?
A. 10,000
B. 20,000
Correct C. 30,000
D. 40,000

Correct Answer: C

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Question 16
A company's risk management strategy involves diversification of its investments across various sectors. If the company invests ₦500 million in a technology firm, ₦300 million in a real estate company, and ₦200 million in a manufacturing firm, what is the total value of its investment portfolio?
Correct A. ₦1 billion
B. ₦1.2 billion
C. ₦1.5 billion
D. ₦2 billion

Correct Answer: A

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Question 17
A warehouse has a storage capacity of 10,000 square meters. If the warehouse is currently 70% occupied, and each pallet occupies 2 square meters, how many pallets can be stored in the remaining space?
A. 1,000 pallets
B. 1,500 pallets
C. 2,000 pallets
Correct D. 3,000 pallets

Correct Answer: D

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Question 18
A company's marketing strategy involves creating a viral video campaign. If the company spends ₦1 million on production and ₦500,000 on advertising, what is the total cost of the campaign?
A. ₦1.5 million
B. ₦1.8 million
Correct C. ₦2 million
D. ₦2.5 million

Correct Answer: C

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Question 19
A bank's interest rate on a savings account is 5% per annum. If a customer deposits ₦100,000 into the account, how much interest will the customer earn in one year?
A. ₦5,000
B. ₦5,500
Correct C. ₦6,000
D. ₦6,500

Correct Answer: C

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Question 20
A transportation company charges a base fare of ₦500 plus ₦2 per kilometer. If a customer travels 50 kilometers, how much will the customer pay?
A. ₦1,000
B. ₦1,200
C. ₦1,500
Correct D. ₦2,000

Correct Answer: D

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Question 21
A commercial bank's primary function is to act as a _______ between the surplus units of the economy and the deficit units.
A. banker
B. broker
C. agent
Correct D. intermediary

Correct Answer: D

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Question 22
The _______ of a firm's financial statements is a measure of its ability to pay its debts as they fall due.
A. liquidity
Correct B. solvency
C. profitability
D. efficiency

Correct Answer: B

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Question 23
A _______ is a contract between two or more parties where one party agrees to carry out a specific task or service for the other party.
A. agency agreement
Correct B. service contract
C. lease agreement
D. employment contract

Correct Answer: B

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Question 24
The _______ of a firm's financial statements is a measure of its ability to generate cash and cash equivalents.
Correct A. cash flow
B. profitability
C. efficiency
D. liquidity

Correct Answer: A

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Question 25
A _______ is a type of business organization where ownership is divided among a large number of shareholders.
A. sole proprietorship
B. partnership
Correct C. corporation
D. cooperative

Correct Answer: C

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