POST UTME LEAD CITY UNIVERSITY 2025 Commerce | Objective

Practice these randomly selected questions to test your readiness.

Question 1
In the context of Risk Management, what is the primary purpose of a 'stop-loss' order?
A. To limit potential losses by selling a security at a specified price.
B. To lock in profits by buying a security at a specified price.
C. To speculate on the price movement of a security.
D. To diversify a portfolio by investing in different asset classes.
Question 2
A consumer protection law requires that all goods sold in the market must be accompanied by a warranty. Which of the following is a type of warranty?
A. Express warranty
B. Implied warranty
C. Statutory warranty
D. Consequential warranty
Question 3
A consumer protection agency receives a complaint about a company's misleading advertising. The agency's primary goal is to protect the consumer's right to truthful information. Which of the following is a key principle of consumer protection?
A. Consumer sovereignty
B. Free market competition
C. Truthful information
D. Consumer choice
Question 4
A company has a share capital of ₦1,000,000, divided into 100,000 ordinary shares of ₦10 each. If the company issues 50,000 shares at a premium of ₦5 per share, what is the total amount received from the issue of shares?
A. ₦500,000
B. ₦750,000
C. ₦1,250,000
D. ₦1,500,000
Question 5
A sole trader's business is affected by a natural disaster, resulting in a loss of ₦200,000. If the sole trader has a personal liability of ₦50,000, what is the amount of the loss that the sole trader must bear?
A. ₦150,000
B. ₦200,000
C. ₦250,000
D. ₦300,000
Question 6
A business owner wants to calculate the break-even point for a new product. The product's selling price is ₦20,000, and the fixed costs are ₦50,000 per month. If the variable costs are ₦10,000 per unit, what is the break-even point in units?
A. 1000
B. 2000
C. 3000
D. 4000
Question 7
A company has a warehouse with a capacity of 10,000 units. The company receives a shipment of 8,000 units and then sells 4,000 units. What is the new inventory level?
A. 4,000 units
B. 6,000 units
C. 8,000 units
D. 10,000 units
Question 8
A firm is considering two production processes: Process A, which involves a fixed cost of ₦100,000 and a variable cost of ₦50 per unit, and Process B, which involves a fixed cost of ₦150,000 and a variable cost of ₦30 per unit. If the firm produces 1,000 units, what is the total cost under Process A?
A. ₦150,000
B. ₦160,000
C. ₦170,000
D. ₦180,000
Question 9
A company is considering launching a new product. The company's marketing manager has estimated that the product's demand will follow a linear demand curve given by the equation: Q = 100 - 2P, where Q is the quantity demanded and P is the price. If the company wants to maximize its revenue, what price should it charge for the product?
A. ₦20
B. ₦30
C. ₦40
D. ₦50
Question 10
In a sole trade business, what is the primary advantage of adopting a sole proprietorship structure?
A. Limited liability
B. Easy to establish
C. Flexibility in decision-making
D. No tax benefits
Question 11
A company's warehouse is used for storing raw materials, work-in-progress, and finished goods. This is an example of which of the following types of warehouses?
A. Raw Material Warehouse
B. Work-in-Progress Warehouse
C. Finished Goods Warehouse
D. Multi-Product Warehouse
Question 12
A company's insurance policy covers losses due to fire, theft, and natural disasters. The policy has a deductible of ₦10,000 and a premium of ₦50,000 per year. If the company experiences a loss of ₦150,000 due to fire, what is the total amount the company must pay?
A. ₦40,000
B. ₦50,000
C. ₦60,000
D. ₦70,000
Question 13
A company's financial statements are prepared in accordance with the Generally Accepted Accounting Principles (GAAP). Which of the following is a characteristic of GAAP?
A. GAAP is based on the cash basis of accounting.
B. GAAP is based on the accrual basis of accounting.
C. GAAP is based on the historical cost basis of accounting.
D. GAAP is based on the current cost basis of accounting.
Question 14
A firm'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. ( BEP = rac{FC}{(P - V)} )
B. ( BEP = rac{FC + V}{P} )
C. ( BEP = rac{FC}{P} )
D. ( BEP = rac{FC - V}{P} )
Question 15
A firm is considering two marketing strategies: Strategy A, which involves a 10% increase in advertising expenditure, and Strategy B, which involves a 5% increase in sales promotion expenditure. If the firm's current advertising expenditure is ₦1,000,000 and its current sales promotion expenditure is ₦500,000, what is the total increase in expenditure under Strategy A?
A. ₦110,000
B. ₦120,000
C. ₦130,000
D. ₦140,000

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