POST UTME SUMMIT UNIVERSITY 2017 Commerce | Objective

Practice these randomly selected questions to test your readiness.

Question 1
A company's memorandum of association may provide for the issue of preference shares. What are the characteristics of preference shares?
A. Preference shares have a fixed dividend rate.
B. Preference shares have a variable dividend rate.
C. Preference shares have a higher claim on assets than ordinary shares.
D. Preference shares have a lower claim on assets than ordinary shares.
Question 2
In a market economy, the law of supply and demand determines the price of a product. However, in a command economy, the government sets the price. Which of the following is a characteristic of a command economy?
A. The government controls the means of production
B. The price is determined by the law of supply and demand
C. The government sets the price
D. The market is free to operate
Question 3
In a perfectly competitive market, the supply curve is upward-sloping because of the law of increasing
A. diminishing returns
B. increasing opportunity costs
C. decreasing marginal utility
D. constant returns to scale
Question 4
A firm's demand function is given by Q = 100 - 2P. If the firm's current price is P = 20, what is the firm's current quantity demanded?
A. 40
B. 60
C. 80
D. 100
Question 5
A company's insurance policy covers losses due to fire, theft, and natural disasters. The policy has a deductible of ₦50,000 and a premium of ₦200,000 per annum. Calculate the expected loss ratio for the company, assuming an average annual loss of ₦150,000.
A. 0.75
B. 0.80
C. 0.85
D. 0.90
Question 6
A sole trader's business is considered a separate legal entity from its owner. Discuss this statement, highlighting the advantages and disadvantages of this arrangement.
A. The sole trader's business is not a separate legal entity from its owner.
B. The sole trader's business is a separate legal entity from its owner, but with limited liability.
C. The sole trader's business is a separate legal entity from its owner, with no liability.
D. The sole trader's business is not a separate legal entity from its owner, with unlimited liability.
Question 7
A firm's revenue function is given by R = 100x - 2x^2. If the firm's current price is ₦50 per unit, what is the maximum revenue it can earn?
A. ₦2500
B. ₦3000
C. ₦3500
D. ₦4000
Question 8
A marketing manager is responsible for launching a new product in the Nigerian market. The product is a premium smartphone with advanced features. Identify the target market for this product and explain the marketing mix (4 Ps) that would be used to promote it.
A. Young professionals aged 25-40, with a focus on the 4 Ps of product, price, promotion, and place.
B. Middle-aged individuals aged 40-60, with a focus on the 4 Ps of product, price, promotion, and place.
C. Older adults aged 60+, with a focus on the 4 Ps of product, price, promotion, and place.
D. Children aged 10-18, with a focus on the 4 Ps of product, price, promotion, and place.
Question 9
A sole trader's business is considered a separate legal entity from its owner. Discuss this statement with reference to the Companies and Allied Matters Act (CAMA) 2020.
A. True, as a sole trader is a legal entity separate from its owner.
B. False, as a sole trader is not a legal entity separate from its owner.
C. It depends on the circumstances.
D. The statement is irrelevant to CAMA 2020.
Question 10
In a perfectly competitive market, the supply curve is upward-sloping because of the law of increasing
A. diminishing returns
B. increasing costs
C. decreasing marginal revenue
D. constant returns to scale
Question 11
A consumer has a budget of ₦500 and a preference for two goods, A and B. The prices of A and B are ₦100 and ₦200 respectively. If the consumer spends all of their budget, what is the maximum amount of good A that the consumer can buy?
A. 2 units
B. 3 units
C. 4 units
D. 5 units
Question 12
A company's articles of association may provide for the appointment of a managing director. What are the implications of this provision?
A. The managing director has absolute authority over the company.
B. The managing director has limited authority over the company.
C. The provision is irrelevant to the company's operations.
D. The provision is only applicable in certain circumstances.
Question 13
A company's articles of association may provide for the appointment of a secretary. What are the duties of a company secretary?
A. The company secretary is responsible for the company's financial affairs.
B. The company secretary is responsible for the company's legal affairs.
C. The company secretary is responsible for the company's administrative affairs.
D. The company secretary is responsible for the company's marketing affairs.
Question 14
In a perfectly competitive market, the law of supply states that as the price of a commodity increases, the quantity supplied will
A. decrease
B. increase
C. remain constant
D. become elastic
Question 15
In a monopolistically competitive market, a firm's demand curve is downward-sloping, but the firm still experiences a high degree of price flexibility. What is the primary reason for this price flexibility?
A. The presence of close substitutes for the firm's product
B. The firm's ability to influence the market price through advertising and other promotional activities
C. The firm's ability to adjust its production levels in response to changes in market demand
D. The firm's ability to set a price that is significantly higher than its marginal cost

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