WAEC SSCE - Commerce - 2002

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The correct answer is "hire purchase". Hire purchase is an agreement between a buyer and a seller in which the buyer makes a down payment and then pays the remaining balance in instalments, typically with interest, until the full purchase price is paid. However, the buyer does not own the item until the final payment is made. This means that the seller can repossess the item if the buyer misses payments.

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The refund of a duty which had been paid on importation that are later re-exported is known as "customs drawback". This is a refund of duties paid on imported goods that are subsequently exported without being altered in any way. It is a way to promote international trade and allows exporters to recover the duties paid on imported goods that are used in the manufacture of products intended for export. The customs drawback system is used to help reduce the cost of goods, making them more competitive in foreign markets.

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Transforming raw materials into finished products is an example of secondary production. Secondary production refers to the process of converting raw materials into finished goods through manufacturing or construction activities. In secondary production, the raw materials undergo a transformation process to create a new product with a different shape, form, or function from the original raw material. For example, when iron ore is extracted from the ground and processed into steel, it undergoes a secondary production process. Similarly, when wood is cut and shaped into furniture, it undergoes secondary production. Secondary production is an important part of the economy, as it adds value to raw materials and creates jobs in manufacturing and construction industries. It is distinct from primary production, which involves the extraction of raw materials from natural resources, and tertiary production, which involves the provision of services.

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A cooperative society has no limit to its membership. A cooperative society is a type of organization that is owned and controlled by its members, who work together to achieve common goals. It is usually formed by a group of individuals who have a shared interest or purpose, such as a group of farmers who come together to market their produce or a group of consumers who want to purchase goods at a lower cost. One of the key features of a cooperative society is that there is no limit to the number of members who can join. This means that the organization can continue to grow and expand its membership as long as there are individuals or groups who are interested in joining. In contrast, other types of organizations, such as private limited companies and limited partnerships, may have restrictions on their membership. For example, a private limited company may have a limit on the number of shareholders it can have, while a limited partnership may require a certain number of general partners and limited partners. Overall, a cooperative society is a flexible and inclusive type of organization that allows individuals and groups to work together towards common goals, without any restrictions on membership.

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The function of money refers to the role that money plays in an economy. It has four main functions: medium of exchange, store of value, unit of account, and standard of deferred payment. The function that is not related to these four is that "it is easily recognizable". While it is important for money to be recognizable to prevent fraud and counterfeit, this is not one of the main functions of money.

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When shares are fully paid, they can be converted into stocks. A stock represents ownership in a company and indicates that the shareholder has a claim on a portion of the company's assets and earnings. Unlike bonds or debentures, which represent debt that must be repaid to the investor, stocks represent an equity investment in the company. Treasury bills, on the other hand, are short-term government debt securities that are not related to shares in a company.

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Retained profit is an internal source of capital to a business concern. It is the portion of a company's net income that is not paid out as dividends but instead is kept as a reserve to reinvest in the business or pay off debt. This is a source of financing that does not involve external stakeholders, such as banks or shareholders, and is thus an internal source of capital. By reinvesting profits back into the business, a company can grow its operations and increase its value without diluting ownership or incurring interest expenses.

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The detailed information about a public offer of a company's shares is contained in the prospectus. A prospectus is a legal document that contains information about a company's financial position, history, management team, risk factors, and details about the shares being offered to the public. It is a key document for potential investors to evaluate the company and make informed decisions about whether to invest in the company's shares.

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An offer by one company to buy up all or a majority of another company's shares is known as a "take-over bid." Essentially, it is a proposal made by the acquiring company to purchase enough shares of the target company to gain control of its operations. This is typically done by offering shareholders a premium price for their shares. The acquiring company may use this strategy to gain access to the target company's assets, intellectual property, or customer base, or to eliminate a competitor in the marketplace. A takeover bid is also known as an acquisition bid or buyout offer.

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Consideration is not a method of discharging a contract. Performance refers to the fulfillment of all obligations and terms of the contract, while breach occurs when one party fails to fulfill their obligations as agreed upon in the contract. Frustration occurs when an unforeseen event makes it impossible to fulfill the contract. Consideration, on the other hand, refers to something of value exchanged between the parties, which is necessary for the formation of a valid contract. It is not a method of discharging a contract, but rather a requirement for the formation of one.

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The correct term for the process by which government takes over the ownership and control of an existing private business is called "nationalization". Nationalization involves the transfer of ownership and control of a private enterprise to the government or state. This can be done for various reasons, such as to protect the national interest, ensure efficient delivery of public services, or promote social welfare.

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Transforming raw materials into finished products is an example of secondary production. Secondary production involves the process of converting raw materials into finished goods, ready for sale or distribution. This process usually involves manufacturing, construction, and assembly. Secondary production is different from primary production, which involves extracting raw materials from the earth or natural resources. Tertiary production, on the other hand, involves providing services, such as healthcare, education, and entertainment, rather than producing physical goods.

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The minimum charge at which the Central Bank lends to commercial banks is called the bank rate. The bank rate is the rate at which the Central Bank provides loans to commercial banks to meet their short-term fund requirements. The bank rate serves as a benchmark rate for the entire financial system and influences other interest rates in the economy, including lending rates charged by commercial banks to their customers. A change in the bank rate has a significant impact on the cost of borrowing and lending, money supply, and inflation.

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If Baba is forced to agree to the terms of a contract at gunpoint, the contract is entered into under duress. Duress occurs when one party uses force or the threat of force to compel another party to enter into a contract against their will. Contracts entered into under duress are generally considered voidable, which means that the party who was forced into the contract has the option to void the contract or enforce it. However, it is important to note that proving duress can be difficult, and it is usually up to the court to determine whether duress was present.

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The brand of vehicle does not influence the choice of means of transport. When choosing a means of transport, there are several factors to consider, including the cost, the value of goods being transported, the urgency of delivery, and the reliability of the transport service. These factors can help to determine the most appropriate means of transport for a particular shipment. Discounts may also influence the choice of transport, as some transport companies may offer reduced rates for certain types of shipments or for customers who use their services frequently. However, the brand of vehicle used for transport is not usually a significant factor in the decision-making process. What is more important is the type of transport service, such as whether it is by air, sea, road, or rail, and the reliability and safety of the service provider. Overall, the choice of means of transport depends on a range of factors, including the nature of the goods being transported, the urgency of delivery, and the cost and reliability of the transport service. The brand of vehicle used for transport is usually not a significant factor in this decision.

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A label on a product like "Three Crown Milk" is a form of branding. Branding refers to the use of a name, term, design, symbol, or other feature that identifies a seller's goods or services and distinguishes them from those of other sellers. A label is an essential part of a product's branding as it contains important information about the product, such as its name, ingredients, nutritional value, and manufacturer. A well-designed label can also help to create a positive perception of the product in the minds of consumers, leading to increased sales and customer loyalty.

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The duty of an agent to a principal is based on trust. An agent is appointed by a principal to act on their behalf and in their best interest. This creates a fiduciary relationship between the agent and the principal. The agent is expected to act honestly, fairly, and in good faith in carrying out the responsibilities assigned by the principal. The agent is also required to keep the principal's confidential information private and not use it for personal gain. All these requirements are based on the trust placed in the agent by the principal, and failure to meet these expectations can result in legal consequences.

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The promoter is not a function of a stock exchange market. A promoter is an individual or group of individuals who bring together the necessary resources to start a business or corporation. They are responsible for raising capital, organizing the company's structure, and creating a business plan. Promoters are involved in the initial stages of a company's formation and are not typically involved in the ongoing trading of its stock. In contrast, a stock exchange is a platform where securities such as stocks, bonds, and derivatives are bought and sold. The primary functions of a stock exchange include providing a market for the trading of securities, facilitating the issuance of new securities, and providing liquidity to investors. Bulls are investors who anticipate a rise in the price of stocks and other securities and seek to profit from it. Brokers are intermediaries who facilitate the buying and selling of securities on behalf of investors. Jobbers are market makers who buy and sell securities on their own account to provide liquidity to the market. Overall, while promoters play a crucial role in the formation of a company, they are not directly involved in the ongoing trading of its stock and therefore not a function of a stock exchange market.

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Retained profits are an internal source of capital for a business concern. When a business earns profits, it has the option of distributing those profits to its owners (shareholders) as dividends or retaining them for reinvestment in the business. The portion of profits that a business chooses to retain is known as retained earnings, which can be used to fund future investments or pay off debt. Retained earnings are an important source of capital for businesses because they do not involve taking on additional debt or diluting ownership through the issuance of new shares of stock. Instead, retained earnings represent a form of internal financing that can help a business grow and expand while maintaining control over its operations. Other sources of capital, such as trade credit, debentures, and overdrafts, are external sources that involve taking on additional debt or selling ownership stakes to outside investors. While these sources of capital can be important for businesses, they also come with additional costs and risks that may not be present with retained earnings.

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The type of cheque that protects the holder against the risk of loss is a crossed cheque. A crossed cheque is one that has two parallel lines drawn across it, indicating that the cheque must be paid into a bank account and cannot be cashed over the counter. This type of cheque is a safer payment method because it ensures that the funds are paid directly into the intended recipient's bank account and cannot be lost or stolen like an open or bearer cheque. As a result, crossed cheques are commonly used for high-value transactions or payments to unknown or untrusted parties.

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A bill of exchange requires acceptances before it can be valid. A bill of exchange is a written order from one person (the drawer) to another (the drawee) to pay a specified sum of money to a third party (the payee) at a future date. The drawee must accept the bill of exchange before it becomes a binding legal document. Acceptance is the drawee's written agreement to pay the amount specified on the bill of exchange. Once the drawee accepts the bill of exchange, they become legally obligated to pay the specified amount to the payee on the due date. In contrast, a promissory note is a written promise to pay a specified amount of money to a named person or order at a specified date or on demand. It does not require acceptance by anyone else to become valid. A letter of credit is a financial instrument that is issued by a bank on behalf of a buyer to guarantee payment to a seller. It does not require acceptances to become valid. A cheque is a written order from an account holder to their bank to pay a specified sum of money to a named person or order. It does not require acceptances to become valid.

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The direct exchange of goods for goods in international trade is known as counter trade. In this type of trade, the buyer and seller agree to exchange goods or services instead of using traditional currency for payment. It is often used between countries with different currencies or where currency exchange is restricted. Counter trade can take different forms such as bartering, offset trade, and buyback. It is a way to overcome trade barriers, build relationships between trading partners, and minimize risks in international trade.

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A certificate of incorporation is best favored by a recorded delivery. This is because a certificate of incorporation is a legal document issued by the Companies House in the UK, or a similar regulatory body in other countries, to confirm the creation of a limited liability company. It is a crucial document that proves the existence of the company, and as such, it is important that it is delivered securely to the intended recipient. Recorded delivery provides a form of proof of delivery, which ensures that the certificate is delivered to the right person and at the right address.

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The transfer of risks already undertaken from one insurance company to another is known as re-insurance. In other words, re-insurance is a process by which an insurer transfers some of the risks it has taken on to another insurance company in exchange for a portion of the premium it has received. Re-insurance helps insurance companies to reduce their exposure to risk and financial losses by sharing the risk with other insurers. This enables insurers to underwrite larger risks than they would be able to on their own, and it helps to stabilize the insurance market.

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A crossed cheque is a type of cheque that protects the holder against the risk of loss. When a cheque is crossed, it means that two parallel lines are drawn across the face of the cheque, indicating that the cheque can only be deposited directly into a bank account, and not cashed over the counter. This provides an added layer of security for the holder, as the cheque can only be credited to the account of the person named on the cheque. This helps to prevent fraud and reduces the risk of loss, as the cheque cannot be cashed by anyone else. On the other hand, an open cheque can be cashed by anyone who presents it for payment, and a bearer cheque can be cashed by the person who holds it, regardless of whether they are the intended recipient. A post-dated cheque is one that has a future date on it and cannot be cashed until that date has passed. However, it does not provide any additional protection against loss or fraud.

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A Letter of Enquiry is sent by a customer who wishes to know the price, quality, and terms of sale of a product. A Letter of Enquiry is a formal request for information from a seller about their products or services. It is typically sent by a potential customer who is interested in purchasing a product or service but needs more information before making a decision. The letter usually includes details such as the product or service being enquired about, the quantity required, and any specific requirements the customer may have. It may also ask for information about the price, quality, delivery time, and terms of sale. In response to the letter, the seller may provide a Quotation or a Proforma Invoice. A Quotation is a formal statement of the price at which the seller is willing to supply the product or service, while a Proforma Invoice is a document that sets out the details of a proposed sale, including the price, quantity, and terms of sale. Overall, a Letter of Enquiry is an important communication tool for potential customers as it helps them to make informed purchasing decisions by providing them with the necessary information about the product or service they are interested in.

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Government regulations are rules and laws that businesses must follow to ensure fair practices, protect consumers, and promote social and economic welfare. One major reason why governments regulate business activities is to ensure fair practices and protect consumers. This is important because businesses have a responsibility to provide safe and quality products or services to consumers, and regulations help to enforce this responsibility. Additionally, regulations can promote social and economic welfare by addressing issues such as environmental protection, labor rights, and public health. Overall, government regulation of business activities helps to maintain a level playing field and ensure that businesses operate in a responsible and ethical manner.

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The principle of subrogation imposes an obligation on the insured to surrender their legal rights after being compensated by their insurer. Subrogation is a legal principle that allows an insurer who has paid a claim to take over the rights and remedies of the insured against a third party who may have caused the loss or damage. This means that after paying out a claim, the insurer can seek to recover the amount paid from the third party. To enable the insurer to exercise their rights of subrogation, the insured is required to surrender their legal rights against the third party once they have been compensated by their insurer. This is because the insurer steps into the shoes of the insured and is entitled to the same legal rights and remedies that the insured had against the third party. By surrendering their legal rights, the insured allows their insurer to pursue recovery of the amount paid out, which can help to reduce the cost of claims and keep insurance premiums affordable. Overall, the principle of subrogation is an important legal concept in insurance, which allows insurers to recover the amount paid out to the insured from third parties who may have caused the loss or damage. This is made possible by the insured surrendering their legal rights after being compensated by their insurer.

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Legal tender refers to the form of currency that is recognized by law as valid for settling debts and transactions within a country. It is the medium of exchange that is accepted as payment for goods and services in a particular jurisdiction. This means that it is a legally recognized and accepted form of payment for any transaction, and it cannot be refused as payment for any outstanding debt. In most countries, legal tender is made up of coins and banknotes issued by the central bank of that country, and they carry a nominal value that is recognized by law. Therefore, the correct option is (b) coins and bank notes.

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ECOWAS stands for the Economic Community of West African States. It is a regional organization of fifteen West African countries established to promote economic integration among member states. ECOWAS aims to create a single large trade bloc by reducing trade barriers and harmonizing trade policies among member countries. Therefore, ECOWAS is an economic union that seeks to enhance economic cooperation and integration among its member states.

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The rate at which a country's currency can be converted to the currency of another country is known as the exchange rate. Exchange rate refers to the value of one country's currency in terms of another country's currency. It represents the rate at which one currency can be exchanged for another currency in the foreign exchange market. Exchange rates are determined by the forces of supply and demand in the foreign exchange market. If the demand for a country's currency is high, its value will appreciate relative to other currencies, and its exchange rate will increase. Conversely, if the demand for a country's currency is low, its value will depreciate, and its exchange rate will decrease. Exchange rates are important in international trade and finance because they affect the cost of imports and exports, as well as the profitability of international investments. They are also used to compare the purchasing power of different currencies and to facilitate international transactions.

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A department store is a retail establishment that offers a wide variety of goods for sale in different departments, such as clothing, cosmetics, appliances, electronics, furniture, and more. Department stores typically have a large physical space, multiple floors, and various sections, allowing customers to browse and purchase a range of products under one roof. Therefore, option A is the correct answer.

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The dissolution of a partnership is the end of a partnership agreement. The question asks which of the options does not lead to the dissolution of a partnership. The absence of a deed of partnership or agreement can make the partnership difficult to enforce but does not necessarily lead to dissolution. Withdrawal of a partner or incapacity of any of the partners can lead to dissolution if the partnership agreement does not provide for such situations, but the question asks for an option that does not lead to dissolution. Therefore, the option that does not lead to dissolution of a partnership is the completion of the contractual term, which is the end of the agreed partnership period or duration. When the partnership agreement is completed as agreed, the partnership is dissolved, and the partners are free to renew the partnership agreement if they choose to continue their business relationship.

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The distribution and exchange of goods and services for the satisfaction of wants is the concern of commerce. Commerce is the exchange of goods and services between businesses, individuals, and governments. It includes all the activities involved in buying, selling, and distributing goods and services. Commerce plays an important role in the economy, as it enables businesses and individuals to obtain the goods and services they need and want. It also helps to create jobs and generates revenue for governments through taxes and tariffs. The ultimate goal of commerce is to satisfy the wants and needs of consumers by providing them with the goods and services they desire.

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When two or more companies come together to work on a project that is too large for one of them to handle alone, it is called a consortium. The companies work together as a group to pool their resources and expertise to achieve the project goals. Each member of the consortium remains an independent entity and retains its own identity, but they cooperate and collaborate to achieve a common objective. Consortia are often formed for large-scale projects such as infrastructure development, research and development, and international trade.

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ECOWAS is a form of an economic union. ECOWAS stands for Economic Community of West African States. It is a regional organization of West African countries established in 1975 with the aim of promoting economic integration among its member states. The organization seeks to create a single large market by reducing trade barriers and promoting free movement of goods, services, and people among member states. As an economic union, ECOWAS aims to create a common market among its member states, in which goods and services can move freely across borders without restrictions. This means that member states can trade with each other without tariffs or other trade barriers, which can increase economic growth, create jobs, and improve the standard of living for people in the region. In addition to promoting economic integration, ECOWAS also works towards achieving political stability, peace, and security in the region. The organization has its headquarters in Abuja, Nigeria, and is made up of 15 member states in West Africa.

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Industry is concerned with the actual production of goods and services. Industries involve the transformation of raw materials into finished products, which are then sold in the market. This process involves manufacturing, construction, and other production activities. The other options, commerce, trade, and service, are related to industry but not directly involved in the actual production of goods and services. Commerce involves the buying and selling of goods, trade involves the exchange of goods and services, and service involves providing assistance or intangible goods to consumers.

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When shares are sold "EX-DIV," it means that the buyer of the shares is not entitled to the dividend that the company has already declared but has not yet paid. The dividend is paid to whoever owns the shares on the record date. The ex-dividend date is set by the stock exchange and is usually two business days before the record date. If a buyer purchases the shares on or after the ex-dividend date, they will not receive the upcoming dividend payment, and it will be paid to the seller instead. Therefore, the answer is that no dividend is paid on the shares when they are sold ex-div.

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A voluntary body formed by people in the same line of business is known as a trade association. It is an organization made up of businesses in a specific industry, trade or profession. The main purpose of a trade association is to promote and protect the interests of its members by providing a forum for discussion and cooperation, as well as representing their views to government and other organizations. Trade associations may also offer training, education, and other services to their members, and may set standards for their industry.

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Hull insurance is taken to cover damage to the body of the ship. It is a type of marine insurance that provides coverage for physical damage to a ship or vessel, including its hull, machinery, and equipment. It is intended to protect ship owners from financial losses in the event of damage to their vessel, which can be caused by a variety of risks, such as collisions, accidents, or natural disasters. By taking out hull insurance, ship owners can have peace of mind knowing that they are protected against potential losses resulting from damage to their ship.

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(a) What is a Chamber of Commerce?

A Chamber of Commerce is a voluntary association of business people, traders, manufacturers and firms in a town, region or country, formed to protect, promote and advance the common commercial interests of its members and to encourage the growth of trade and industry in the area.

(b) Six functions of a Chamber of Commerce

1. It protects and promotes the common trading interests of its members.
2. It provides commercial information and advice to members on trade, markets and business opportunities.
3. It represents the views of the business community to the government and makes recommendations on trade policy, taxation and legislation.
4. It settles trade disputes among members through arbitration.
5. It organises trade fairs, exhibitions and trade missions to promote local and foreign trade.
6. It issues certificates of origin and other documents needed by members in foreign trade.

(c) Three functions of a Manufacturers Association

1. It protects and promotes the common interests of manufacturers and presents their views to the government.
2. It advises members on production, standards and technical matters and encourages the growth of local industries.
3. It negotiates with government and labour on policies, incentives and conditions affecting manufacturing.

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(a) Four ways registered mail differs from ordinary mail

1. Record of posting: Registered mail is recorded and a receipt issued at the post office, whereas ordinary mail is posted without any record.
2. Compensation: The sender of registered mail is entitled to compensation if it is lost or damaged, while ordinary mail carries no such guarantee.
3. Cost: Registered mail attracts an extra fee in addition to normal postage, whereas ordinary mail requires only the ordinary stamp.
4. Signature on delivery: Registered mail must be signed for by the receiver as proof of delivery, while ordinary mail is simply dropped in the box or handed over without a signature.

(b) Transporting goods by rail

Two advantages

1. It is suitable for carrying heavy and bulky goods over long distances at relatively low cost.
2. It is fast and runs to a fixed timetable, and is less affected by traffic congestion.

Two disadvantages

1. It offers no door-to-door service, so goods must be moved to and from the station by other means.
2. It follows a fixed route and cannot reach places not served by a railway line, and it is unsuitable for small or urgent consignments.

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(a) Four reasons why retail shops adopt self service

1. To reduce cost of operation: Fewer shop assistants are needed since customers serve themselves, so wage costs are lowered.
2. To serve more customers quickly: Self service speeds up shopping and reduces queues, so many customers can be attended to within a short time.
3. To encourage impulse buying: When goods are openly displayed and customers can handle them, they are tempted to buy more than they planned.
4. To give customers freedom of choice: Customers can move around, compare goods and select at their own pace without being pressured by salesmen.

It also helps the shop to sell in large volume at lower prices.

(b) Six facilities that a retail shop should have to encourage self service

1. Open shelves and display racks: Goods should be arranged on open shelves where customers can see, reach and pick them easily.
2. Shopping baskets and trolleys: These should be provided so that customers can carry the goods they select as they move round the shop.
3. Price tags and labels: Every item should be clearly priced and labelled so that customers know the price without asking.
4. Checkout (paying) points: There should be cash tills or checkout counters near the exit where customers pay for all their selected goods at once.
5. Wide aisles and good layout: There should be spacious, well-arranged passages so that customers can move about freely with their trolleys.
6. Security devices: Facilities such as closed-circuit cameras, mirrors and security tags should be provided to guard against shoplifting.

Good lighting, air conditioning and directional signs also help self service.

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(a) Four characteristics of a co-operative society

1. Open and voluntary membership: Membership is open to all who are qualified and can be joined or left freely.
2. Democratic control: It operates on the principle of one member, one vote, irrespective of the number of shares held.
3. Service (not profit) motive: Its main aim is to serve and promote the welfare of members rather than to make maximum profit.
4. Sharing of surplus as dividend: Any surplus made is shared among members, usually in proportion to their patronage or savings.

Other characteristics include registration under the cooperative law and limited interest on capital.

(b) Three types of co-operative society

1. Consumer cooperative society: Formed by consumers who join together to buy goods in bulk directly from producers and sell to members at fair prices, thereby eliminating middlemen and reducing costs.
2. Producer (marketing) cooperative society: Formed by producers such as farmers who come together to obtain inputs, process and market their produce jointly and secure better prices for their goods.
3. Cooperative thrift and credit society: Formed by people who save regularly together so that members can obtain loans at low interest rates to meet their needs.

Other types include cooperative wholesale societies and multi-purpose cooperative societies.

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(a) Five functions performed by the wholesaler in the channel of distribution

1. Breaking bulk: He buys goods in large quantities from manufacturers and sells them in smaller quantities to retailers.
2. Storage (warehousing): He stores goods in his warehouse and releases them steadily, thereby bridging the time gap between production and consumption.
3. Provision of finance: He gives credit to retailers and pays cash to manufacturers, thereby financing both sides of the trade.
4. Bearing of risk: He bears risks such as fall in prices, damage, deterioration and spoilage while the goods are in his possession.
5. Transportation: He arranges for the movement of goods from the manufacturer to his warehouse and from there to the retailers.

Other functions include grading, packaging, branding and giving market information to manufacturers.

(b) Five factors that encourage the elimination of middlemen from the channel of distribution

1. Direct selling by producers: Manufacturers who sell directly to consumers through their own outlets or online remove the need for middlemen.
2. High cost of middlemen's services: The profit margins added by middlemen raise prices, so firms bypass them to reduce cost.
3. Growth of large-scale retailers: Big supermarkets and multiple shops buy directly from manufacturers in bulk, doing the wholesaler's work themselves.
4. Consumer cooperative societies: These buy directly from producers on behalf of members, cutting out the middlemen.
5. Improved communication and technology: The internet and e-commerce allow producers and consumers to deal directly without intermediaries.

Perishable goods that must reach consumers quickly also encourage direct sale.

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(a) Five measures taken to restrict imports

1. Import duties (tariffs): Imposing high customs duties on imported goods raises their prices and discourages their purchase.
2. Import quotas: Fixing a maximum quantity of a commodity that may be imported within a period limits inflow.
3. Import licensing: Requiring traders to obtain a licence before importing restricts the number and volume of imports.
4. Total ban (embargo): Prohibiting the importation of certain goods entirely keeps them out of the country.
5. Foreign exchange control: Limiting the foreign currency made available to importers reduces their ability to buy from abroad.

(b) Five measures taken to promote exports

1. Export subsidies: Government grants and financial assistance lower the cost of production, making exports cheaper and competitive abroad.
2. Devaluation of currency: A lower value of the domestic currency makes exports cheaper to foreign buyers, boosting demand.
3. Removal or reduction of export duties: Abolishing taxes on exports increases the profit of exporters and encourages them.
4. Export promotion agencies and trade fairs: Setting up bodies and organising international trade fairs advertise home products abroad.
5. Improved infrastructure and export credit: Providing good ports, roads and cheap credit facilities to exporters eases and encourages exporting.

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(a) Explanation of terms

1. Turnover: The total value of net sales made by a business during a given trading period.
2. Rate of turnover (rate of stockturn): The number of times the average stock held is sold and replaced within a trading period. It is found by dividing the cost of goods sold by the average stock.
3. Net profit: The profit left after deducting all operating expenses from the gross profit; that is, gross profit less expenses.

(b) Calculations

(i) Cost of goods sold (COGS)

COGS = Opening stock + Purchases - Closing stock

COGS = N1,000 + N10,000 - N5,000 = N6,000

(ii) Rate of turnover

Average stock = (Opening stock + Closing stock) ÷ 2 = (1,000 + 5,000) ÷ 2 = N3,000

Rate of turnover = COGS ÷ Average stock = 6,000 ÷ 3,000 = 2 times

(iii) Net profit

Gross profit = Sales - COGS = 15,000 - 6,000 = N9,000

Net profit = Gross profit - Expenses (wages) = 9,000 - 1,000 = N8,000

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(a) What is an advertising medium?

An advertising medium is the channel or means through which an advertising message is carried and communicated from the advertiser to the target audience or potential customers.

(b) Eight advertising media

1. Newspapers
2. Magazines
3. Radio
4. Television
5. Posters and billboards (hoardings)
6. Handbills and leaflets
7. Direct mail (letters, catalogues)
8. The internet and social media

(c) Five factors to consider before choosing an advertising medium

1. Nature of the product: Technical goods may need media that allow demonstration, while everyday goods suit mass media.
2. Target audience: The medium chosen must reach the particular group of people the product is meant for.
3. Cost of the medium: The expense must be within the firm's advertising budget and justified by returns.
4. Coverage or reach: Whether the message is meant for a local, national or international audience influences the choice.
5. Literacy level of the audience: For illiterate people, audio-visual media like radio and television are more effective than print.

Antwortdetails

Two uses of each document:

(a) Price list

• It informs prospective buyers of the current prices of goods offered for sale.
• It helps a buyer to compare prices and prepare an order or enquiry.

(b) Delivery note

• It accompanies goods sent to the buyer and lists the items delivered.
• It is signed by the buyer as evidence that the goods were received.

(c) Consignment note

• It accompanies goods handed to a carrier (for example rail or road) and gives details of the goods and destination.
• It serves as a receipt and evidence of the contract of carriage between sender and carrier.

(d) Advice note

• It notifies the buyer in advance that the goods ordered have been dispatched and are on the way.
• It enables the buyer to prepare to receive and check the goods on arrival.

(e) Proforma invoice

• It is sent to a prospective buyer to show the price and terms of goods so the buyer can decide to place a firm order.
• It is used to request advance payment or when goods are sold on a cash-with-order basis, and to help clear goods through customs.