POST UTME UI 2019 Commerce | Objective

Are you preparing for POST UTME UI exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2019 Commerce (Objective) questions designed to simulate the real exam environment.

Practice these randomly selected questions to test your readiness.

Question 1
In a perfectly competitive market, the supply curve is upward-sloping because of the law of increasing
Correct A. diminishing returns
B. marginal utility
C. opportunity cost
D. law of supply

Correct Answer: A

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Question 2
A sole trader's business is registered under the
A. Companies and Allied Matters Act
Correct B. Business Registration and Licensing Act
C. Companies Act
D. Trade Marks Act

Correct Answer: B

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Question 3
The diagram below shows a firm's production possibilities frontier. If the firm decides to produce more of good X, it will have to
Correct A. produce less of good Y
B. produce more of good Y
C. remain at the same level of production
D. increase the price of good X

Correct Answer: A

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Question 4
A company's financial statements are audited by an independent auditor to ensure that they are
Correct A. accurate and reliable
B. relevant and timely
C. relevant and reliable
D. accurate and relevant

Correct Answer: A

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Question 5
The diagram below shows a firm's cost curve. If the firm decides to produce more units of output, its
A. average fixed cost will decrease
Correct B. average variable cost will increase
C. marginal cost will decrease
D. total fixed cost will increase

Correct Answer: B

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Question 6
In a perfectly competitive market, the supply curve is horizontal and the demand curve is downward-sloping. What is the equilibrium price and quantity of the product?
A. ₦100, 1000 units
Correct B. ₦120, 800 units
C. ₦150, 600 units
D. ₦180, 400 units

Correct Answer: B

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Question 7
A company has a total revenue of ₦1,200,000 and a total cost of ₦900,000. What is the profit of the company?
Correct A. ₦300,000
B. ₦200,000
C. ₦100,000
D. ₦50,000

Correct Answer: A

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Question 8
A firm is considering two investment projects. Project A has a net present value (NPV) of ₦500,000 and a payback period of 5 years. Project B has an NPV of ₦600,000 and a payback period of 4 years. Which project should the firm choose?
A. Project A
Correct B. Project B
C. Both projects are equally attractive
D. Neither project is attractive

Correct Answer: B

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Question 9
A company has a production function given by Q = 2L^0.5K^0.5, where Q is the quantity produced, L is the labor input, and K is the capital input. If the company wants to produce 100 units of output, how much labor and capital should it use?
A. L = 100, K = 100
B. L = 50, K = 200
C. L = 200, K = 50
Correct D. L = 100, K = 50

Correct Answer: D

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Question 10
A firm is considering two different storage facilities. Facility A has a capacity of 1,000 units and a rental cost of ₦10 per unit per year. Facility B has a capacity of 2,000 units and a rental cost of ₦20 per unit per year. If the firm expects to store 1,500 units, which facility should it choose?
Correct A. Facility A
B. Facility B
C. Both facilities are equally attractive
D. Neither facility is attractive

Correct Answer: A

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Question 11
A bank's cash reserve requirement is 10% of its total deposits. If the bank has ₦1,500,000 in deposits, how much cash must it reserve?
Correct A. ₦150,000
B. ₦1,500,000
C. ₦15,000,000
D. ₦150,000,000

Correct Answer: A

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Question 12
A company imports 500 units of a product from a foreign country. The cost of each unit is 20. If the exchange rate is 1 USD = ₦360, what is the total cost of the import in Nigerian Naira?
Correct A. ₦10,800,000
B. ₦9,600,000
C. ₦12,000,000
D. ₦11,200,000

Correct Answer: A

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Question 13
A consumer protection law requires that all goods sold in a market must have a warranty period of at least 2 years. If a product has a warranty period of 1 year and 6 months, does it comply with the law?
A. Yes
Correct B. No
C. Maybe
D. It depends

Correct Answer: B

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Question 14
A company has a policy of paying its employees a 10% bonus on their annual salary. If an employee earns ₦500,000 per year, how much bonus will they receive?
Correct A. ₦50,000
B. ₦5,000
C. ₦500,000
D. ₦50,000,000

Correct Answer: A

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Question 15
A marketing campaign for a new product involves a 20% discount on the first purchase. If the original price of the product is ₦1,200, how much will a customer pay after the discount?
Correct A. ₦960
B. ₦1,200
C. ₦1,440
D. ₦1,680

Correct Answer: A

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Question 16
The Central Bank of Nigeria (CBN) uses monetary policy to regulate the money supply in the economy. Which of the following instruments is used to reduce the money supply?
A. Open Market Operations (OMO)
Correct B. Reserve Requirements
C. Discount Rate
D. Quantitative Easing

Correct Answer: B

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Question 17
A consumer protection agency is established to protect consumers from unfair business practices. Which of the following is a key function of a consumer protection agency?
A. To promote competition among businesses
B. To provide information to consumers about products and services
Correct C. To investigate complaints from consumers
D. To regulate prices of goods and services

Correct Answer: C

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Question 18
A firm produces a product using a production process that involves several stages. Which of the following is an example of a production function?
A. A function that shows the relationship between inputs and outputs
B. A function that shows the relationship between prices and quantities
C. A function that shows the relationship between costs and revenues
Correct D. A function that shows the relationship between inputs and outputs in a production process

Correct Answer: D

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Question 19
A firm is considering investing in a new project. Which of the following is a key factor that the firm should consider when making a decision?
A. The expected rate of return on the investment
Correct B. The expected level of risk associated with the investment
C. The expected level of competition in the market
D. The expected level of government support for the investment

Correct Answer: B

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Question 20
A firm is considering exporting its products to a foreign market. Which of the following is a key advantage of exporting?
A. Increased competition in the domestic market
Correct B. Access to new markets and customers
C. Increased costs associated with exporting
D. Reduced prices of goods and services

Correct Answer: B

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Question 21
A sole trader's business is considered a separate legal entity from its owner. What is the primary advantage of this separation?
Correct A. Liability protection
B. Tax benefits
C. Increased credibility
D. Easier access to capital

Correct Answer: A

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Question 22
A company's financial statements are audited annually. What is the primary purpose of this audit?
A. To ensure compliance with tax laws
Correct B. To verify the accuracy of financial statements
C. To identify areas for cost reduction
D. To evaluate the company's risk management strategy

Correct Answer: B

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Question 23
A warehouse manager is responsible for maintaining inventory levels. What is the primary benefit of just-in-time (JIT) inventory management?
A. Reduced storage costs
Correct B. Improved inventory turnover
C. Increased flexibility in production planning
D. Enhanced customer satisfaction

Correct Answer: B

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Question 24
A foreign trade agreement between two countries involves the exchange of goods and services. What is the primary benefit of this agreement?
A. Increased competition in the domestic market
B. Improved access to new markets and customers
C. Enhanced economic growth and development
Correct D. Reduced trade barriers and tariffs

Correct Answer: D

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Question 25
A business organization's financial performance is evaluated using various metrics. What is the primary purpose of the return on investment (ROI) ratio?
A. To assess the company's liquidity position
Correct B. To evaluate the effectiveness of the company's investment decisions
C. To compare the company's financial performance with industry benchmarks
D. To identify areas for cost reduction

Correct Answer: B

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