POST UTME RHEMA UNIVERSITY 2020 Commerce | Objective
Practice these randomly selected questions to test your readiness.
Question 1
A company is considering forming a partnership with another company to expand its business operations. The partnership agreement will require the companies to share profits and losses equally. What is the main advantage of forming a partnership?
Question 2
A company has a profit of ₦1 million, and its directors declare a dividend of 10% on the share capital. If the company has 100,000 ordinary shares of ₦100 each, what is the amount of dividend paid to each shareholder?
Question 3
A company is considering launching a new advertising campaign to promote its product. The company has estimated that the campaign will cost ₦1,000,000 and is expected to generate an additional ₦2,000,000 in revenue. What is the expected return on investment (ROI) for the company?
Question 4
A company is considering launching a new product in the Nigerian market. What type of market research would be most appropriate for this purpose?
Question 5
A bank offers a loan of ₦5 million at an interest rate of 15% per annum, compounded quarterly. If the loan is repaid in 5 years, what is the total amount paid by the borrower?
Question 6
A company is considering two marketing strategies for its new product. Strategy A involves a high initial investment in advertising, but the product will be priced low to attract a large market share. Strategy B involves a lower initial investment in advertising, but the product will be priced higher to target a niche market. Which strategy is more likely to result in higher profits in the long run?
Question 7
A company is considering exporting its products to a foreign market. The company's export manager estimates that the demand for the product in the foreign market will be 10,000 units per year, with a price of ₦500 per unit. If the company's production cost is ₦300 per unit, and the company wants to make a profit of 20% on its sales, what should be the minimum price at which the company should sell the product in the foreign market?
Question 8
A company is considering launching a new product in the Nigerian market. What type of marketing strategy would be most appropriate for this purpose?
Question 9
A sole trader is considering expanding his business to include a new product line. What type of business organization would be most suitable for this purpose?
Question 10
A firm is considering two mutually exclusive projects. Project A has a 60% chance of success and a 40% chance of failure, with a payoff of ₦1,000,000 if it succeeds and a loss of ₦500,000 if it fails. Project B has a 70% chance of success and a 30% chance of failure, with a payoff of ₦1,500,000 if it succeeds and a loss of ₦200,000 if it fails. Which project should the firm choose?
Question 11
A firm is considering two different transportation modes to deliver its products to customers. Mode A has a fixed cost of ₦10,000 and a variable cost of ₦5 per unit, while Mode B has a fixed cost of ₦20,000 and a variable cost of ₦3 per unit. If the firm needs to deliver 10,000 units, which mode is more cost-effective?
Question 12
A sole trader is selling a business to a limited company. The sole trader has assets worth ₦1 million and liabilities of ₦500,000. The limited company is willing to pay ₦1.2 million for the business. What is the profit that the sole trader will make from the sale?
Question 13
A sole trader has a business income of ₦1,000,000 and a business expense of ₦500,000. If the sole trader wants to pay a tax of 20% on its business income, how much tax will the sole trader pay?
Question 14
A company is considering investing in a new project that requires an initial investment of ₦5 million. The project is expected to generate an annual revenue of ₦2 million for 5 years, and then an annual revenue of ₦1.5 million for the next 5 years. What is the net present value of the project, assuming a discount rate of 10%?
Question 15
A firm's insurance policy covers it against losses due to fire. Which of the following is a type of insurance policy?
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