POST UTME VERITAS UNIVERSITY 2024 Commerce | Objective

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Question 1
In a perfectly competitive market, the demand curve for a firm's product is its
Correct A. marginal revenue curve
B. marginal cost curve
C. average revenue curve
D. average cost curve

Correct Answer: A

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Question 2
A firm's revenue is maximized when its marginal revenue equals its
Correct A. marginal cost
B. average cost
C. marginal revenue
D. average revenue

Correct Answer: A

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Question 3
A consumer's indifference curve is a graphical representation of the various combinations of two goods that yield the same level of
Correct A. utility
B. satisfaction
C. happiness
D. pleasure

Correct Answer: A

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Question 4
A firm's supply curve is upward-sloping because as the price of its product increases, it becomes more
A. profitable
B. expensive
Correct C. difficult to produce
D. attractive

Correct Answer: C

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Question 5
A perfectly competitive market is characterized by a large number of firms producing a homogeneous product, free entry and exit, and
A. a single buyer
B. a single seller
Correct C. free entry and exit
D. barriers to entry

Correct Answer: C

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Question 6
In the context of home and foreign trade, what is the primary objective of a country's trade policy?
A. To maximize exports and minimize imports
B. To balance trade deficits and surpluses
Correct C. To promote economic growth and development
D. To protect domestic industries and jobs

Correct Answer: C

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Question 7
A firm's cost of capital is the minimum return required by investors for a given level of risk. What is the primary factor that affects a firm's cost of capital?
A. The firm's size and market share
Correct B. The firm's financial leverage and debt-to-equity ratio
C. The firm's industry and market conditions
D. The firm's management team and corporate governance

Correct Answer: B

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Question 8
A company is considering investing in a new project with an initial investment of ₦1,000,000 and expected annual cash flows of ₦500,000 for 5 years. What is the net present value (NPV) of the project, assuming a discount rate of 10%?
Correct A. ₦1,250,000
B. ₦1,500,000
C. ₦1,750,000
D. ₦2,000,000

Correct Answer: A

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Question 9
A firm's supply curve is given by the equation Q = 2P + 10, where Q is the quantity supplied and P is the price. What is the slope of the supply curve?
A. -2
Correct B. 2
C. -10
D. 10

Correct Answer: B

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Question 10
A firm's demand curve is given by the equation Q = 100 - 2P, where Q is the quantity demanded and P is the price. What is the price elasticity of demand?
Correct A. -0.5
B. 0.5
C. -1
D. 1

Correct Answer: A

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Question 11
A company's financial statements are audited annually by an independent auditor. The auditor's report is presented to the shareholders at the annual general meeting. Which of the following is the primary purpose of the auditor's report?
A. To provide an opinion on the company's financial position
B. To identify any material weaknesses in internal control
Correct C. To express an opinion on the fairness of the financial statements
D. To provide an opinion on the company's compliance with laws and regulations

Correct Answer: C

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Question 12
A consumer purchases a product online and receives a defective item. The consumer contacts the seller and requests a replacement. The seller agrees to replace the item but requires the consumer to pay for return shipping. Which of the following is the consumer's legal right?
A. To request a full refund for the defective item
Correct B. To request a replacement item without paying for return shipping
C. To request a partial refund for the defective item
D. To request a store credit for the defective item

Correct Answer: B

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Question 13
A bank offers a credit card with an annual interest rate of 18% and a minimum monthly payment of ₦500. If the customer's outstanding balance is ₦10,000, how much will the customer pay in interest over the first year?
Correct A. ₦1,800
B. ₦1,900
C. ₦2,000
D. ₦2,100

Correct Answer: A

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Question 14
A sole trader operates a business from a rented shop. The sole trader's business is not registered with the Corporate Affairs Commission. Which of the following is the sole trader's legal obligation?
Correct A. To register the business with the Corporate Affairs Commission
B. To obtain a business license from the local government
C. To pay taxes on the business income
D. To maintain accurate financial records

Correct Answer: A

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Question 15
A company issues 1,000 shares of stock at a price of ₦100 per share. If the company receives ₦120,000 from the sale of the shares, what is the company's total revenue?
A. ₦120,000
Correct B. ₦125,000
C. ₦130,000
D. ₦135,000

Correct Answer: B

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Question 16
In a perfectly competitive market, the law of diminishing marginal utility is most relevant to the production of which of the following goods?
A. Giffen Goods
B. Normal Goods
Correct C. Inferior Goods
D. Substitutes

Correct Answer: C

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Question 17
A firm's production function is given by Q = 2L^0.5 + 3K^0.5. If the firm's current inputs are L = 4 and K = 9, what is the marginal product of labor?
Correct A. 1
B. 2
C. 3
D. 4

Correct Answer: A

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Question 18
A country's trade balance is given by TB = X - M, where X is the value of exports and M is the value of imports. If the country's current trade balance is TB = 100 and the value of imports is M = 150, what is the value of exports?
A. 200
Correct B. 250
C. 300
D. 350

Correct Answer: B

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Question 19
A firm's cost function is given by C = 2L + 3K. If the firm's current inputs are L = 4 and K = 9, what is the total cost?
A. 20
Correct B. 30
C. 40
D. 50

Correct Answer: B

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Question 20
A country's current account balance is given by CAB = TB + NI, where TB is the trade balance and NI is the net investment income. If the country's current trade balance is TB = 100 and the net investment income is NI = 50, what is the current account balance?
A. 100
Correct B. 150
C. 200
D. 250

Correct Answer: B

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Question 21
In a sole trader business, what is the primary advantage of using a separate business bank account?
A. Easy accounting and tax compliance
B. Improved business credibility and reputation
Correct C. Enhanced financial security and reduced risk
D. Increased business flexibility and adaptability

Correct Answer: C

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Question 22
A company has a capital structure consisting of 60% equity and 40% debt. What is the cost of capital for this company?
A. 8%
Correct B. 9%
C. 10%
D. 11%

Correct Answer: B

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Question 23
A consumer purchases a product with a price of ₦1,500 and a 10% discount. What is the amount of the discount?
Correct A. ₦150
B. ₦200
C. ₦250
D. ₦300

Correct Answer: A

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Question 24
A company exports 500 units of a product to a foreign country. The selling price per unit is 20, and the exchange rate is 1 USD = 400 NGN. What is the total revenue in Naira?
A. ₦4,000,000
B. ₦4,500,000
Correct C. ₦5,000,000
D. ₦5,500,000

Correct Answer: C

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Question 25
A sole trader business has a profit of ₦200,000 and a capital of ₦500,000. What is the return on investment (ROI) for this business?
A. 40%
Correct B. 50%
C. 60%
D. 70%

Correct Answer: B

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