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Question 1 Report
Span of control is defined as the
Answer Details
Span of control refers to the number of subordinates that a manager or supervisor can effectively manage. This can vary
depending on the nature of the work, the skills of the manager or supervisor, and the skills of the subordinates. In this case, the
span of control is defined as the number of subordinates reporting directly to a supervisor.
Question 2 Report
Taxes imposed on locally made goods are known as
Answer Details
Taxes imposed on locally made goods are known as excise duties. Excise duties are taxes imposed on goods produced within the
country, as opposed to import duties which are taxes imposed on goods coming into the country. Ad valorem duties are taxes
based on the value of the goods, and export drawback is a refund of duties on exported goods, so these options are not correct.
Question 3 Report
Trade can be described as
Answer Details
Trade can be defined as the act of buying and selling goods and services. It involves the exchange of goods or services between
parties, which is a fundamental aspect of economic activity. While 'purchase of goods and services' and 'distribution of goods' are
related concepts, they do not encompass the full definition of trade, which specifically includes both buying and selling.
Question 4 Report
The selling of articles from place to place on foot is
Answer Details
Itinerant trading refers to a type of retailing where the retailer does not have a fixed place of business. Instead, they move from
place to place, selling their goods.
Question 5 Report
The production of goods in anticipation of demand is possible because of the existence of?
Answer Details
The production of goods in anticipation of demand is possible because of the existence of warehousing. Warehousing allows for
the storage of goods until they are needed. This means that production can occur in anticipation of future demand, with the
produced goods being stored in a warehouse until the demand arises.
Question 6 Report
In which of the following organizations are members entitled to one vote, irrespective of the number of shares held?
Answer Details
In a co-operative society, members are entitled to one vote, irrespective of the number of shares held. This is based on the
principle of 'one member, one vote' which is fundamental to the operation of co-operatives. In contrast, in public corporations,
partnerships, and limited companies, voting rights are usually determined by the number of shares a person holds.
Question 7 Report
The net profit is calculated as
Answer Details
Net profit is calculated as gross profit less expenses. Gross profit is the profit a company makes after deducting the costs
associated with making and selling its products, or the costs associated with providing its services. Expenses include items like
administrative costs, interest, taxes, and other costs not included in the cost of goods sold.
Question 8 Report
The mode of transport that conveys goods at low cost per unit is
Answer Details
Rail transport is the mode of transport that conveys goods at low cost per unit. This is because trains can carry a large amount of
goods at once, reducing the cost per unit. Additionally, trains are fuel-efficient and can travel long distances without needing to
refuel, further reducing costs.
Question 9 Report
A false statement made by one party with an intention of inducing the other party to enter into a contract with him is known as
Answer Details
A false statement made by one party with an intention of inducing the other party to enter into a contract with him is known as
misrepresentation.
Misrepresentation is a concept in contract law where a false or misleading statement is made that convinces
another party to enter into an agreement. The statement could be a fact that is not true, or could be a promise made without any
intention of performing it.
Question 10 Report
An example of in invisible item of trade is
Answer Details
Invisible items of trade refer to services and other non-tangible items that are traded internationally. Shipping is a service and
therefore an example of an invisible item of trade. Oil, machinery, and textiles are all tangible goods, so they are not considered
invisible items of trade.
Question 11 Report
A company which acquires more than 50% voting shares of another company is called?
Answer Details
A holding company is a company that owns the stocks of other companies. The term is usually used to refer to a company that
does not produce goods or services itself, but its purpose is to own shares of other companies. If a company acquires more than
50% voting shares of another company, it is called a holding company because it has controlling interest in the company.
Question 12 Report
The difference between a country's imports and exports of goods in a particular year is
Answer Details
The difference between a country's imports and exports of goods in a particular year is the balance of trade. If a country exports
more than it imports, it has a trade surplus. If it imports more than it exports, it has a trade deficit.
Question 13 Report
The exchange of goods for goods in foreign trade is known as?
Answer Details
Counter trade refers to the exchange of goods or services which are paid for, in whole or part, with other goods or services, rather
than with money. In the context of foreign trade, this would involve the exchange of goods for goods between different countries.
Question 14 Report
Which of the following is most appropriate for a "Cash with Order" terms of sale?
Answer Details
A proforma invoice is a preliminary bill of sale sent to buyers in advance of a shipment or delivery of goods. It is often used to
declare the value of the trade. It is not a true invoice because it is not used to record accounts receivable for the seller and
accounts payable for the buyer. 'Cash with Order' means that the buyer pays when ordering the goods and they are dispatched
only after payment is received. Therefore, a proforma invoice is most appropriate for a 'Cash with Order' terms of sale.
Question 15 Report
Commercial activities among West African countries are greatly hindered by
Answer Details
Commercial activities among West African countries are greatly hindered by the lack of an acceptable medium of exchange. This
is because different countries have different currencies, and the exchange rates between these currencies can fluctuate, making
trade more difficult and unpredictable. Nationalization decree, good road network, and too many commercial banks do not
directly hinder commercial activities among West African countries.
Question 16 Report
A trader's turnover was D36,000. Purchases was D28,000. The opening stock was D2,000 and the closing stock D3,000. The average
stock is
Answer Details
The average stock is calculated by adding the opening and closing stock and dividing by 2.
In this case, Average Stock = (D2,000 (Opening Stock) + D3,000 (Closing Stock)) / 2
= D2,500.
Question 17 Report
The part of issued share capital that the company has asked the subscribers to pay for
Answer Details
The part of issued share capital that the company has asked the subscribers to pay for is called the called-up capital. This is the
portion of a company's share capital that has been called for payment. It is the value of shares that a company has issued and
investors have promised to pay.
Question 18 Report
Which of the following is a source of capital to a sole proprietorship?
Answer Details
A source of capital for a sole proprietorship could be loans from friends. A sole proprietorship is a type of enterprise that is
owned and run by one person and in which there is no legal distinction between the owner and the business entity. The owner is
in direct control of all elements and is legally accountable for the finances of such business and this may include debts, loans, loss,
etc.
Question 19 Report
The difference between the cost price and selling price of an article is
Answer Details
The difference between the cost price and selling price of an article is known as the mark-up. Mark-up is the amount added to the
cost price of goods to cover overheads and profit. It is the difference between the cost of a product and its selling price.
Question 20 Report
Goods are usually classified into
Answer Details
In economics, goods are usually classified into producer goods and consumer goods. Producer goods, also known as capital goods,
are used in the production of either more complex capital goods or consumer goods. Consumer goods are the end result of
production and manufacturing and are what a consumer will see on the store shelf. Other classifications like saleable and non-
saleable, inferior and superior, luxurious and essential are not standard economic classifications of goods.
Question 21 Report
The fees charged on postal order by the post office is
Answer Details
The fees charged on postal orders by the post office is known as poundage. Poundage is a type of service charge that is levied to
cover the costs of processing the postal order. It is not interest, brokerage, or premium.
Question 22 Report
The charge paid by a speculator for non-settlement of his account within the specified period is
Answer Details
The charge paid by a speculator for non-settlement of his account within the specified period is known as contango. Contango is a
situation where the futures price of a commodity is higher than the spot price. It is a fee paid by the buyer to the seller when the
buyer wishes to defer settlement of the deal they have made.
Question 23 Report
Which of the following types of insurance is taken against claims made by staff who get injured while at work?
Answer Details
Employers' liability insurance is a policy that protects employers from financial loss if a worker has a job-related injury or illness
not covered by workers' compensation. Employers' liability insurance can be packaged with workers' compensation insurance to
further protect companies against the costs associated with workplace injuries, illnesses, and deaths not covered under workers'
compensation.
Question 24 Report
Use the following information below to answer the question
Ojo bought a bicycle for ₦20,000, and repaired it at a cost of ₦5,000. He then sold the bicycle for ₦30,000
What is the percentage of expenses over cost?
Answer Details
% of expenses over cost =
500/20,000 x 100
= 25%
Question 25 Report
A new offer of contract that terminates the original offer is
Answer Details
A counter offer is a response given to an initial offer. It means the original offer has been rejected and replaced by a new one.
Therefore, it terminates the original offer. A void contract is a contract that is not legally enforceable. An invalid offer is an offer
that does not meet the legal requirements for a valid contract. A quasi contract is a contract created by a court in the interests of
fairness and justice.
Question 26 Report
A contract to take possession of goods on installment
Answer Details
A hire purchase contract is a type of contract where the buyer takes possession of goods and pays in installments. The ownership
of the goods is transferred only after the full payment is made. Therefore, a contract to take possession of goods on installment is a
hire purchase contract.
Question 27 Report
An insurance policy that covers the body of the ship only is called
Answer Details
Hull insurance is a type of marine insurance that covers the hull and machinery of a ship. It provides indemnity for loss of or
damage to the ship itself, as opposed to the cargo (which would be covered by cargo insurance) or potential liabilities from
accidents (covered by P&I clubs).
Question 28 Report
The duty of an agent of necessity to a principal is based on?
Answer Details
The duty of an agent of necessity is based on trust. An agent of necessity acts on behalf of the principal in situations where
immediate action is required to protect the principal's interests, and the principal trusts the agent to act in their best interest
under those urgent circumstances.
This trust is fundamental because the agent's actions are taken without prior approval or
explicit instructions from the principal, relying on the trust that they will make decisions in the principal's best interest.
Question 29 Report
Which of the following is the clearing house for all the banks in the country?
Answer Details
The Central Bank of Nigeria serves as the clearing house for all the banks in the country. A clearing house is a financial institution
formed to facilitate the exchange (i.e., clearance) of payments, securities, or derivatives transactions. The Central Bank of Nigeria
provides this service for all other banks in the country.
Question 30 Report
Unlimited liability in business implies that the
Answer Details
Unlimited liability implies that the owner's private property can be used to settle the business debts. In a business with unlimited
liability, the owner is personally responsible for all the business's debts, which means their personal assets can be used to pay off
the business's debts if the business itself doesn't have enough assets to cover them.
Question 31 Report
An open cheque is one
Answer Details
An open cheque is a cheque that is not crossed on the left corner and payable at the counter of the bank. An open cheque may be a
bearer cheque or an order one. It means the bank can pay the cheque amount to the person who presents it, even if he is not the
drawer or the payee.
Question 32 Report
The transfer of ownership of government business to individuals is
Answer Details
The transfer of ownership of government business to individuals is known as privatization. Privatization is the process of
transferring an enterprise or industry from the public sector to the private sector. The public sector is the part of the economic
system that is run by government agencies.
Question 33 Report
When a public company receives the certificate of incorporation, this implies that
Answer Details
When a public company receives the certificate of incorporation, it means that it is legally recognized and can start its business
operations.
The certificate of incorporation is a legal document relating to the formation of a company or corporation. It is a
license to form a corporation issued by the state government or, in some jurisdictions, by non-governmental entity/corporation.
Its precise meaning depends upon the legal system in which it is used.
Question 34 Report
Which of the following is not a principle of insurance?
Answer Details
The principles of insurance include indemnity, subrogation, insurable interest, utmost good faith, proximate cause, and
contribution. However, 'Insurable risk' is not a principle of insurance. It is a term used to describe a risk that meets the ideal
criteria for efficient insurance. The risk must be definable, financially measurable, and non-catastrophic, allowing the insurer to
charge a reasonable premium.
Question 35 Report
The expert who calculates premium for an insurance company is?
Answer Details
An actuary is a business professional who deals with the financial impact of risk and uncertainty. Actuaries use mathematics,
statistics, and financial theory to study uncertain future events, especially those of concern to insurance and pension programs.
They evaluate the likelihood of those events, design creative ways to reduce the likelihood and decrease the impact of adverse
events that actually do occur.
Question 36 Report
Use the information below to answer questions below
|
# |
|
|
Sales |
50,000.00 |
|
Debtors |
10,000.00 |
|
Cash in hand |
5,000.00 |
|
Opening stock |
30,000.00 |
|
Creditors |
8,000.00 |
|
Purchases |
16,000.00 |
|
Overdraft |
12,000.00 |
|
Closing stock |
10,000.00 |
Calculate the working capital
Answer Details
Working capital is calculated as Current Assets - Current Liabilities.
From the given data, Current Assets = Debtors + Cash in hand + Closing stock = 10,000 + 5,000 + 10,000 = 25,000.
Current Liabilities = Creditors + Overdraft -8,000 +12,000 -20,000.
Therefore, Working Capital = 25,000 - 20,000 = 5,000.
Question 37 Report
The transfer of risks already undertaken from one insurance company to another is?
Answer Details
Re-insurance is the practice where an insurance company transfers a part of its risk to another insurance company to protect
itself from large claims. It allows the insurer to remain solvent after major claims events.
Question 38 Report
The grading of products to satisfy different buyers is referred to as?
Answer Details
Product differentiation refers to a process where a business tries to distinguish its product from similar products in the market.
This can be achieved through unique branding, advertising, or even through the product design itself. In this case, grading of
products to satisfy different buyers is a form of product differentiation, as it involves creating different versions of a product to
appeal to different customer segments.
Question 39 Report
The job of the police in keeping law and order in the society is
Answer Details
While the police work to maintain law and order, their role is considered indirect because they are not directly providing a
tangible product or service to individuals. Instead, they create an environment where citizens can safely engage in commercial,
social, and other activities.
Question 40 Report
Which of the following describes the reason for international trade?
Answer Details
International trade is primarily driven by the concept of comparative cost advantage. This economic theory suggests that
countries should specialize in producing goods for which they have a lower opportunity cost and trade for goods that other
countries produce at a lower opportunity cost. This allows for efficient use of resources and increases the total output and
consumption.
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