JAMB UTME - Commerce - 2024

Which of the following does a seller send in reply to a letter of inquiry?

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When a potential buyer sends a seller a **letter of inquiry**, they are typically asking for information regarding the availability, price, and terms of products or services. In reply to this inquiry, a seller typically sends a **quotation**.

Here is why a **quotation** is the appropriate response:

• Quotation: This is a formal document provided by the seller in response to an inquiry, detailing the price and terms under which goods or services will be supplied. A quotation includes essential information about the price of products, delivery conditions, discount policies, validity period of the offer, and any other relevant details. It serves as a basis for negotiation and is used by buyers to make purchasing decisions.


• Credit Note: This is issued by the seller to the buyer, often used to rectify a post-purchase issue such as an overcharge or a returned item. It is not used to respond to an inquiry.


• Debit Note: This is similar to an invoice and is issued by a buyer to the seller to request a credit note. It indicates that the buyer owes the seller, but like a credit note, it is not used to respond to an inquiry.


• Delivery Note: This accompanies a shipment of goods and provides details about the delivered products. It confirms what was sent or received, but it is not used in response to an inquiry.

In conclusion, a seller sends a quotation in response to a letter of inquiry because it addresses the buyer's questions about pricing and other terms related to potential products or services they might purchase.

All the following are principles of insurance EXCEPT

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In insurance, there are several fundamental principles that ensure the contractual agreement between the insurer and the insured is fair and effective. Among these principles, three are well-known:

Insurable Interest: This principle states that the insured must have a financial stake in the object or life insured. The policyholder should suffer a financial loss if the insured event occurs. This ensures that insurance is not a mere gambling proposition.

Utmost Good Faith (Uberrimae Fidei): Both parties involved in an insurance contract are required to disclose all relevant information truthfully. The insured must reveal all material facts, and the insurer should provide honest terms and conditions.

Subrogation: After compensating the insured for a loss, the insurer may step into the shoes of the insured to seek recovery from a third party responsible for the loss. This principle prevents the insured from profiting more than once for the same loss.

On the other hand, the term "Particular Average" is not one of the fundamental principles of insurance. Instead, it is a maritime insurance term used to describe partial loss or damage to a ship or its cargo that is not shared by all parties but borne only by the individual whose cargo was damaged. Therefore, among the options provided, "particular average" is the exception as it is not a principle of insurance.

The coming together of two or more firms with each of them losing its identity is known as

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The coming together of two or more firms with each of them losing its identity is known as an amalgamation.

An amalgamation occurs when two or more companies combine to form a new entity, and as a result, each of the original companies ceases to exist as an independent entity. The firms essentially merge to create a new organization with a new identity. This is different from other forms such as a holding company where individual companies maintain their identities or a consortium, which is generally a collaboration without the loss of individual identities. It's not similar to a cartel either, as a cartel involves competitors collaborating to set prices or output but still maintaining their distinct identities.

The document which gives complete information about the goods sold is the

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The document that provides complete information about the goods sold is the invoice.

An invoice is a detailed statement provided by the seller to the buyer containing important information regarding the sale of goods. Here’s why it is deemed so comprehensive:

• Itemized List: It includes an itemized list of the goods sold, along with descriptions, quantities, and unit prices.
• Total Amount: It shows the total amount payable by the buyer, including applicable taxes and discounts.
• Terms of Sale: It outlines the terms and conditions of the sale, such as payment due date and methods of payment.
• Identification Details: It contains essential information like the invoice number and date, which helps in tracking and reference.
• Seller and Buyer Information: It includes the names, addresses, and contact details of both the seller and the buyer.

In contrast, the order form is a document generated by the buyer to request goods but doesn't contain the details of the actual sale. A delivery note accompanies goods to confirm delivery but lacks pricing and terms. Lastly, a bill of exchange is a financial document used for payment agreements, not for detailing goods sold.

Therefore, the invoice is the key document providing complete information about the goods sold.

Which of the following services is NOT rendered by NITEL?

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The service that is NOT rendered by NITEL is Recorded Delivery.

Explanation:

NITEL, which stands for Nigerian Telecommunications Limited, was mainly involved in providing telecommunications services in Nigeria. Its core services included:

• Providing Data Transmission services, which allow for the transfer of data from one computer or device to another over a network.
• Offering Satellite services, which involve the use of satellite technology for communication purposes, allowing for long-distance and international telecommunications.
• Offering Telex services, which are a method for sending and receiving text-based messages using teleprinters, primarily for business and official communication.

On the other hand, Recorded Delivery is a service typically offered by postal services, not telecommunication companies. It involves sending mail with proof of mailing and, sometimes, delivery confirmation. This ensures that mailed items are tracked and delivered securely.

Which of the following types of insurance is usually excluded from the principle of indemnity?

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The principle of indemnity in insurance states that an insured should not profit from a loss but rather be restored to their financial position prior to the loss. This principle is applied to prevent the insured from benefiting financially from an insurance claim.

Among the options provided, Life Insurance is usually excluded from the principle of indemnity. In the case of life insurance, it is not possible to quantify the loss of life in monetary terms and therefore indemnification in its traditional sense does not apply. Instead, life insurance works on a principle of paying out a specified sum when the insured event (death or specified incident) happens.

Other types of insurance like Fire, Fidelity Guarantee, and Marine are indemnity-based, meaning the payout aims to cover the actual financial loss. For example, if a fire damages property, the insurance payout is based on the value of the property destroyed. Similarly, fidelity guarantee insurance covers loss due to employee dishonesty, and marine insurance compensates for damage or loss of goods during transit. Therefore, these fall under the principle of indemnity.

In summary, life insurance is excluded from the principle of indemnity because it deals with the incalculable loss of a life by providing a predetermined benefit rather than a directly quantifiable financial covering of loss.

Which of the following forms part of a company's Article of Association?

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The name of the company is an essential component of the Articles of Association. It specifies the legal name under which the company operates and is registered.

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The relationship between a country's visible imports and exports in a trading year is known as the balance of trade.

To understand this concept, think of it as a way to measure how much a country is buying from other countries (imports) compared to how much it is selling to other countries (exports). When we talk about "visible" imports and exports, we refer to tangible goods like cars, food products, electronics, etc., that you can see, touch, and feel.

The balance of trade is essentially the difference in value between a country's visible exports and visible imports. If a country exports more than it imports, it has a trade surplus. Conversely, if it imports more than it exports, it has a trade deficit.

This concept is crucial because it gives insights into a country's economic health. A trade surplus might indicate a strong economy, whereas a trade deficit might suggest dependency on other nations for goods.

In summary, the balance of trade helps us understand the economic relationship between a country and its trading partners by showing whether the country has a surplus or deficit in its visible goods trade. Other terms like counter trade, international trade, and balance of payment have different meanings in economics and should not be confused with the balance of trade.

The rules and regulations guiding the conduct of business transactions are known as law

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In the context of **business transactions**, the rules and regulations that govern them are primarily known as **commercial law**. This is because **commercial law deals specifically with the legal aspects of business and trade**, and it includes a variety of laws that regulate how businesses operate, how they interact with other businesses, and how consumers are protected in these transactions.

Other laws mentioned, such as:

• Criminal law: Generally pertains to crimes and legal penalties for offenses against the state or public, rather than specific business transactions.
• Common law: Represents a body of unwritten laws based on legal precedents and is applicable in judicial decisions but is not specific to business laws.
• Contract law: Governs agreements between parties but is a subset of commercial law, specifically focusing on agreements and obligations within a business context.

Therefore, when discussing the guidelines and frameworks for business transactions specifically, **commercial law** is the umbrella under which these rules and regulations fall.

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In an organization, welfare services are those that aim to improve the well-being and satisfaction of employees, providing them with a supportive and healthy working environment. Welfare services often include amenities or benefits that contribute directly to employees' health, happiness, and overall work-life balance.

Let's examine each option:

• Medical Facilities: These are services provided to ensure the health and medical safety of employees. They include health check-ups, medical insurance, and on-site medical care. These are typical examples of welfare services.
• Transportation: Offering transportation facilities or allowances helps employees commute to and from work more comfortably and safely. This is also considered a welfare service as it directly influences the employees' convenience and reduces stress related to commuting.
• Recreational Facilities: These are amenities provided to help employees relax and rejuvenate. They can include gymnasiums, sports facilities, or relaxation areas, designed to enhance employees' physical and mental well-being, thus qualifying as welfare services.
• Training: This refers to providing employees with the knowledge and skills required to perform their job roles effectively. While training is crucial for skill development and professional growth, it primarily serves the organization's interest in increasing productivity and effectiveness rather than the personal welfare or comfort of the employees.

Considering the above definitions, training is NOT typically regarded as a welfare service in an organization. Unlike the other options, which focus on employee well-being, training emphasizes enhancing performance and skill sets to benefit organizational goals.

Bonded warehouse is controlled and supervised by

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A bonded warehouse is a secure facility where goods are stored, and duties or taxes are deferred until the goods are removed and sold. These warehouses play a crucial role in international trade.

A bonded warehouse is specifically controlled and supervised by customs authorities. Customs are responsible for the regulation and examination of goods that are imported or possibly exported from the country.

Here is why customs control bonded warehouses:

• Duty Regulation: Customs is in charge of collecting import duties and taxes. By regulating bonded warehouses, customs ensures that these financial obligations are met before goods are released.
• Security and Compliance: Customs ensures that the goods stored in bonded warehouses comply with local and international trade regulations, preventing illegal trade activities.
• Inventory Control: Customs keeps track of stored goods, ensuring that none are lost, swapped, or improperly documented.
• Efficient Trade Facilitation: Customs authorities expedite the clearance process for goods stored in bonded warehouses, reducing delays and enhancing international trade efficiency.

This control by customs is crucial for maintaining transparency and compliance in the import and export of goods, ensuring the appropriate duties are collected and that regulations are respected.

The principle of insurance which ensures that an individual is restored to his former position after suffering a loss is

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The principle of insurance that ensures an individual is restored to his former position after suffering a loss is the principle of indemnity. This principle is based on the idea that insurance is meant to compensate for the financial loss or damage suffered, and nothing more. It ensures that the insured party is not put in a better position than they were before the loss. The goal is simply to bring the insured back to the status they were at before the loss occurred. In essence, indemnity prevents the insured from profiting from an insurance claim, ensuring that they are compensated fairly and justly for their actual loss.

The service rendered by NIPOST in which letters are addressed to any post office to await collection by the addressee is known as

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The Free post service allows individuals to send letters or parcels to any post office without the need to pay for postage upfront. The addressee can then collect the item from the designated post office upon presentation of proper identification.

Tariff can be defined as a compulsory levy on

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A tariff is a compulsory levy imposed by a government on imported goods only. This means that when products are brought into a country from abroad, a tax or duty is charged by the government on these goods. Tariffs are typically used to protect domestic industries from foreign competition by making imported goods more expensive, encouraging consumers to buy locally produced items. They can also be a source of revenue for the government. By increasing the cost of imports, tariffs influence the prices and choices available to consumers, often making domestic goods more appealing. In summary, tariffs are specifically associated with imports, not exports, foreign exchange earnings, or foreigners working in a particular country.

Which of these is NOT a governments legislation to protect the consumer?

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The correct option that is NOT a government legislation to protect the consumer is Privatization and Commercialization.

Let me explain this in a simple way:

• Foods and Drugs: These legislations are meant to ensure that food and drug products sold to the public are safe, properly labeled, and effective. They protect consumers from harmful substances and misleading claims.
• Weight and Measure: This type of legislation ensures that products are weighed and measured accurately at the point of sale. It protects consumers from being cheated in terms of quantity and pricing.
• Trade Description: This legislation prevents businesses from providing false or misleading information about products and services. It protects consumers by ensuring that they know exactly what they are buying.

However:

• Privatization and Commercialization: These terms refer to the process through which government-owned businesses and services are transferred to the private sector. This is more about economic policy and restructuring how services are provided, rather than directly protecting consumers. It focuses on improving efficiency and reducing government burden but does not primarily aim to protect consumer rights.

Therefore, while the first three directly aim to protect consumers, Privatization and Commercialization are more about economic management and do not serve as consumer protection legislation.

Branding is the assigning of trade marks to goods for the purpose of......... by the public.

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Branding is the assigning of trademarks to goods for the purpose of identification by the public. This means that branding helps consumers easily recognize and differentiate a particular product from other similar products in the market. Trademarks can be logos, symbols, names, or a combination of these elements that represent a brand. By having a unique and consistent brand identity, companies ensure that their products are easily identifiable by consumers, facilitating customer trust and loyalty. In essence, branding provides a way for the public to identify and remember the products of a specific manufacturer or company.

A wholesaler who acts as an agent on behalf of the owner of the goods in buying or selling for a commission proportionate to the value of the transaction is called a

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In the context of trade and commerce, a wholesaler who acts on behalf of the owner of goods in buying or selling, and receives a commission based on the value of the transaction, is typically referred to as a factor.

Here's why:

A factor is a type of agent who is enthusiastically involved in the buying and selling process of goods. This role often involves taking possession of the merchandise, managing the sales, and sometimes providing advance payment to the owner. For these efforts, the factor earns a commission proportionate to the transaction value.

Factors differ from some other types of agents in that they often have more responsibilities, including the power to sell goods in their own name, collect proceeds from buyers, and handle various logistical aspects of the sale.

In contrast:

- A commissioned agent might not necessarily take possession of the goods or manage the detailed logistical aspects of sales.

- A del-credere agent provides a guarantee to the principal that the buyer will perform as agreed, essentially assuming responsibility for any buyer defaults, but this does not inherently describe their primary role in the wholesale process.

- A speculator doesn't fulfill an agency role for the owner of goods but rather buys goods directly to sell at a profit, often taking on significant risk in the hope of financial gain.

Therefore, in the scenario you provided, the term most accurately describing the wholesaler's role as an agent working for a commission based on the transaction value is a factor.

The breaking down of work into different processes is known as

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The breaking down of work into different processes is known as division of labour. This concept involves splitting a job into a series of smaller tasks, with each task assigned to a different worker or group of workers. By doing this, each worker can focus on what they do best, increasing their efficiency and productivity in that particular task.

Here's a simple way to understand it: Imagine a bakery that makes loaves of bread. Instead of one person doing everything from mixing the ingredients, kneading the dough, baking, and packaging, the work is divided among several people. One person may be responsible for mixing the ingredients, while another focuses on kneading the dough, yet another bakes it, and a final person packages the bread. This makes the entire process faster and more efficient, as each worker becomes proficient in their specific task.

The division of labour allows for a more effective use of skills and resources, leading to higher productivity and often resulting in goods being produced more quickly and for less cost.

The policy designed to accelerate the greater participation of Nigerians in the ownership and management of business enterprises in Nigeria is called

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The policy designed to accelerate the greater participation of Nigerians in the ownership and management of business enterprises in Nigeria is called Indigenization.

Indigenization refers to efforts and policies implemented to transfer ownership and control of enterprises and resources from foreign and non-national entities to the nationals of a country. The aim is to increase the involvement of local citizens in the economy of their country, ensuring that they have a substantial stake in the economic activities.

In the context of Nigeria, the indigenization policy was meant to empower Nigerians by enabling them to own and manage businesses. This was achieved by legally requiring certain levels of Nigerian ownership and participation in various sectors of the economy. Such policies were put in place to reduce foreign control and ensure that the wealth generated within the country contributed to national development and was accessible to the citizens of Nigeria.

Banks issue cheque books to customers holding ___________ accounts.

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Banks issue cheque books to customers holding current accounts.

Let me explain why:

A current account is designed for regular transactions. It is ideal for individuals or businesses that need frequent access to their funds. This account allows for multiple daily transactions such as deposits, withdrawals, and transfers.

One primary feature of a current account is the ability to issue cheques. A cheque is a written order to a bank to pay a certain amount of money from one’s account to another person or entity.

Unlike a current account, foreign accounts, deposit accounts, and fixed deposit accounts serve different purposes:

• Foreign accounts: Typically used for operations involving foreign currencies.
• Deposit accounts: Generally include savings accounts, where the primary aim is to save money and earn interest, with limited transaction capabilities.
• Fixed deposit accounts: Involve depositing money for a specific period, where the funds are not intended for frequent access or cheque issuance.

Therefore, banks provide cheque books specifically for current accounts to facilitate regular transactions.

Prospectus in relation to a public limited inability company means

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In the context of a public limited company, a prospectus refers to a formal document that is issued by the company to provide essential information to potential investors. It serves as an invitation to the public to buy shares in the company.

The main purpose of the prospectus is to help potential investors make informed decisions about whether or not to invest in the company's shares. It typically contains details such as:

• The nature of the business and its operations.
• The types of shares being offered and their respective terms.
• Financial statements and future business plans.
• Information about the company's management and governance.
• The risks associated with investing in the company.

The prospectus is a crucial document because it ensures transparency and allows investors to assess the potential risks and rewards involved in purchasing shares from the company.

Which of the following advertising media preselects its readership through the nature of its content?

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The advertising medium that preselects its readership through the nature of its content is the magazine.

Magazines are designed to cater to specific interests and demographics, meaning they often attract readers who are interested in particular topics or subjects. For instance, there are magazines on hobbies like photography, fashion, technology, sports, and many more. Because they focus on specific themes, they naturally draw in an audience that is interested in those areas. Advertisers can use magazines to reach a target audience that aligns with their product or message.

In contrast, other media such as billboards, handbills, and newspapers are generally more broad and do not specifically tailor their content to a particular interest group. For example, newspapers cover a wide range of topics like news, sports, and entertainment, reaching a more general audience. Billboards and handbills aim to capture anyone who happens to see them.

A dealer who buys securities at low prices in anticipation of reselling them at higher prices is called a

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A dealer who buys securities at low prices in anticipation of reselling them at higher prices is called a bull.

Here's a simple explanation:

• Bull: A bull is an investor who expects the prices of securities, such as stocks or bonds, to rise over time. In anticipation of this rise, a bull will purchase these securities at their current lower prices, with the hope of selling them later at higher prices to make a profit. This optimistic approach is often referred to as having a "bullish" outlook towards the market.

Let's contrast this with the other terms mentioned:

• Jobber: Jobber is an old term for a trader who buys and sells securities on their account without dealing directly with the public, primarily for short-term trades.
• Broker: A broker acts as an agent or intermediary between buyers and sellers to facilitate trades, earning a commission for their services rather than buying securities for their profit.
• Bear: A bear, opposite of a bull, is an investor who expects prices to fall and might sell securities at a current high expecting to buy them back at a lower price. This is usually referred to as having a "bearish" outlook.

The following are functions of marketing EXCEPT

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Marketing is a broad concept that involves various activities to promote and sell products or services. Let's briefly explore each option in relation to marketing:

Packaging: This is a marketing function that involves designing and producing the containers or wrappers for a product. The purpose of packaging is to protect the product, facilitate its storage and transport, and make it appealing to consumers.

Distribution: This function refers to the process of getting the product from the manufacturer to the consumer. It involves activities like transportation, warehousing, and supply chain management, ensuring that the product is available to customers at the right time and place.

Advertising: Advertising is a marketing function that focuses on promoting a product or service through various media channels. The aim is to inform potential customers about a product, persuade them to purchase, and build brand awareness.

Insurance: This is not a marketing function. Insurance is a financial service that provides risk management and protection against potential financial losses. While businesses may use insurance to protect their assets, it is not a function aimed at promoting and selling products or services like the other activities mentioned.

In summary, insurance is not a function of marketing. It stands apart as a service focused on risk management rather than the promotion and sale of products or services.

A tax paid on goods manufactured and consumed in your country is called

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The type of tax that is paid on goods that are manufactured and consumed within a country is called excise duty.

Excise duty is essentially a tax on the manufacturers of certain goods and products within the country. It is typically levied on goods that are considered either luxurious or harmful if over-consumed, such as cigarettes, alcohol, or fuel. The government imposes this tax to either limit the consumption of these goods, to increase government revenue, or both.

This tax is different from custom duty or income tax. Custom duty is charged on goods that are imported into a country, whereas income tax is charged on individuals' or entities' earnings.

The act of being on one job for expertise is called

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The act of being on one job for expertise is called specialization. Specialization is when an individual, group, or company focuses on a specific task, role, or field to become highly skilled and efficient in that area. For example, a person might specialize in medicine, engineering, or teaching, dedicating their time and effort to gaining deep knowledge and expertise in that particular domain.

Specialization allows individuals to become experts, improving their ability to perform their job effectively and efficiently. It also contributes to overall productivity and quality, as specialized professionals can apply their specific skills to complex tasks or problems, leading to more innovative and precise solutions.

In summary, by focusing on one job or area, individuals can hone their skills and contribute to greater efficiencies and advancements in their field.

Which of the following is NOT part of the marketing mix?

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The marketing mix is commonly referred to as the "4 Ps", which are key elements involved in executing a marketing strategy effectively. These elements are:

• Product: Goods or services offered by a business to its customers.
• Price: The amount of money customers pay to acquire the product or service.
• Place: The distribution channels and locations used to reach customers and deliver the product or service.
• Promotion: The activities undertaken to make the product known to customers, such as advertising and sales tactics.

Unlike the "4 Ps," personnel is not traditionally considered a part of the marketing mix. While having skilled and well-trained staff is crucial for customer service and operations, it is not one of the main components in the traditional marketing mix. Thus, among the options provided, personnel is NOT part of the marketing mix.

The rights of the consumers does NOT include

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In discussing the rights of consumers, it's important to recognize that these rights are intended to ensure fair treatment, safety, and access to necessary information. Let's look closely at the options provided to determine which one does not align with consumer rights:

• The right to a healthy environment: This is indeed a consumer right. It ensures that products and services do not harm the environment and that consumers can enjoy environmentally sustainable options.
• The right to be informed: Consumers have the right to receive accurate information about products and services, which helps them make informed decisions.
• The right to choose: This right enables consumers to select from a range of products and services at competitive prices.

The right to fix prices: However, this is not a consumer right. **Consumers do not have the right to set or fix the prices of goods and services.** ^Pricing is usually determined by companies, influenced by factors like production costs, market demand, and competition.^ While consumers can compare prices and make choices based on their budget and preferences, the **determination of prices is not within their rights**.

In summary, **the correct answer is that consumers do not have the right to fix prices**. This responsibility lies with businesses and is regulated to prevent practices like price fixing, which can harm consumer interests.

A typical example of an event covered by an Assurance Policy is

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An event that is typically covered by an Assurance Policy is death.

Assurance policies are often referred to as life assurance or life insurance. The primary purpose of these policies is to provide a financial safety net for beneficiaries in the event of the policyholder's death.

Life assurance is considered a form of long-term coverage that guarantees a payout when the insured person passes away, as long as the premiums have been paid consistently. This type of policy is different from insurance policies that cover specific events, like accidents or burglary, which are often provided as short-term risk coverages.

Therefore, **death** is the typical event covered by an assurance policy because the primary intent of such policies is to ensure that financial obligations can be met and dependents are taken care of after the policyholder's death.

One of the following does NOT fit into the group.

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In order to determine which of the options does not fit into the group, we should first classify each of them based on their primary nature or sector.

Agriculture involves the cultivation of land and breeding of plants and animals to provide food, fiber, and other products used to sustain and enhance life. It primarily falls under the category of primary industry that deals with the extraction and harnessing of natural resources directly from nature.

Fishing also involves extracting biological resources directly from nature, specifically aquatic life from water bodies. Like agriculture, it is categorized under primary industry and focuses on the direct procurement of resources provided by nature.

Mining is the extraction of minerals or other geological materials from the Earth, and it is considered a part of primary industry as well. It involves the direct extraction of non-renewable resources from nature.

Carpentry, on the other hand, is a skilled trade in which the primary work performed is the cutting, shaping, and installation of building materials during the construction of buildings, ships, timber bridges, etc. Carpentry is considered a part of the secondary industry, which involves manufacturing and processing of raw materials into finished goods or products.

Therefore, Carpentry does not fit into the group because, unlike agriculture, fishing, and mining, it is not a primary industry activity. It belongs to the secondary industry, which focuses on the transformation of raw materials into finished products.

Closing stock is also known as

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Closing stock is also known as Ending Inventory. It refers to the amount of inventory or stock that remains unsold at the end of an accounting period. This can include raw materials, work-in-progress, and finished goods. Closing stock is important for financial reporting, as it affects the cost of goods sold and, ultimately, the company's profit. It is calculated by taking into account all the inventory purchases and subtracting the cost of goods that have been sold during the period. To express it simply, closing stock is what is left over after sales have been accounted for.

• The term stock at close can be misleading, as it might imply the price of a stock market asset at the end of a trading day.
• Balance brought forward refers to the balance amount of funds or stock from the previous period brought into the current one, not the ending stock.
• Opening inventory refers to the stock at the beginning of the accounting period, not at the end.
• Stock at beginning is synonymous with opening inventory and is not equivalent to closing stock.

Therefore, the correct and precise term for closing stock is Ending Inventory.

Fishing is an example of

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Fishing is an example of the extractive industry. This industry involves activities that extract natural resources from the earth or water bodies. In the case of fishing, it means obtaining fish and other sea creatures from oceans, rivers, and lakes. The extractive industry is characterized by the removal of raw materials from their natural environment without any transformation into other forms before they are further processed, utilized, or consumed.

For example, when fishermen catch fish, they are directly taking resources from nature without altering them. These resources can either be directly consumed or processed into different products, depending on the demand and usage.

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An agreement that is enforceable in law is called a contract.

Here's why:

1. A contract is a legal agreement between two or more parties. Each party agrees to do or not to do something in exchange for some benefit, typically referred to as consideration. In simpler terms, it's a promise or set of promises that the law will enforce.

2. For an agreement to be considered a contract, it generally must contain the following elements:

• Offer: One party proposes an arrangement to another.
• Acceptance: The other party agrees to the terms of the offer.
• Consideration: There is something of value exchanged between the parties.
• Mutual Intent: Both parties intend to create a binding agreement.
• Capacity: Both parties must have the legal ability to enter into a contract.
• Legality: The contract's purpose must be legal.

3. Unlike a decree or a declaration which are generally formal statements or orders typically issued by a government or authority, or an offer which is a proposal but not yet binding, a contract actively binds the parties involved and can be enforced by law. If one party fails to fulfill their stipulated duties, the other can seek legal remedies.

Gross profit can be calculated as

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The calculation of **gross profit** is done by taking the total **sales revenue** and subtracting the **cost of goods sold (COGS)**. Hence, the correct formula to calculate gross profit is:

Gross Profit = Sales - Cost of Goods Sold

Let's break it down for clarity:

• **Sales** refers to the total revenue earned from selling goods or services. It is the income received from customers before any costs are deducted.
• **Cost of Goods Sold (COGS)** represents the direct costs attributable to the production of the goods sold. This includes expenses such as the cost of materials and direct labor involved in producing the goods.

The **gross profit** reflects the company's **profitability** related to its core operations, excluding other expenses such as operating expenses, taxes, and interest.

For example, if a company records total sales of $100,000 and its cost of goods sold is $60,000, the gross profit would be:

Gross Profit = $100,000 - $60,000 = $40,000

The gross profit of $40,000 provides insight into the financial **efficiency** of the company's production and sales processes.

Stock exchange quoted the shares of ABC Plc at #0.75K for #1.25K per share. This means the shares were sold at a

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When shares are quoted on a stock exchange, it signifies the price at which the stock is available for purchase. The problem provides two prices regarding the shares of ABC Plc:

• #0.75K - This is the par value of each share. The par value is a nominal or face value of a share when it is initially issued. It is the minimum price that the company has set to start with.
• #1.25K - This is the price per share at which these shares were sold in the market. When the selling price is higher than the par value, it means the shares were sold at a premium.

In this scenario, since the selling price (#1.25K) is higher than the par value (#0.75K), the shares were sold at a premium. Therefore, the stocks of ABC Plc were sold for more than their face value, which indicates that investors were willing to pay more than the nominal value for those shares, typically due to the company's perceived potential or existing market demand.

One of the easiest means of transporting petroleum product is by

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Pipelines are one of the easiest and most efficient means of transporting petroleum products. Here is why:

1. Continuous Flow: Pipelines allow for a constant and uninterrupted flow of petroleum products from one location to another. This continuity ensures a steady supply and minimizes delays that can occur with other modes of transportation.

2. Cost-Efficient: Over long distances, pipelines are generally more cost-effective than other transportation methods. This is due to lower operating costs and the ability to transport large volumes of product with minimal energy input once the infrastructure is in place.

3. Safety: Pipelines are considered to be a safer option for transporting petroleum products compared to road or rail. They reduce the likelihood of accidents or spills that can occur with vehicles or trains, making them a preferred choice for minimizing environmental impact.

4. Reliability: Unlike air or road transport, pipelines are less affected by weather conditions, traffic, or other disruptions, which makes them a reliable choice for consistent delivery schedules.

5. Low Environmental Impact: While the construction of pipelines can initially impact the environment, their operation creates fewer emissions compared to repeated vehicle trips. This makes pipelines a more environmentally friendly option in the long term.

Overall, due to these advantages, pipelines are often the preferred method for transporting large volumes of petroleum products over long distances in a safe, cost-effective, and reliable manner.

The association that encourages savings for the benefit of its members is known as

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The association that encourages savings for the benefit of its members is known as a Credit and Thrift Co-operative Society.

Let me explain this in simple terms:

• A Credit and Thrift Co-operative Society is a type of organization where members voluntarily come together to save their money on a regular basis.
• The primary purpose of this type of society is to encourage savings among its members. It helps members accumulate their savings in a safe and structured manner.
• These societies also provide members with access to credit or loans. The money saved by the members is used to give loans back to them at low-interest rates, which is beneficial for individuals who may not have easy access to standard banking loans.
• The profits made by the society through lending are typically shared among the members, hence everyone benefits from their collective savings.

In summary, a Credit and Thrift Co-operative Society is all about saving money together as a group and supporting each other financially by providing easy access to loans.

Which of these is used in calculating working capital?

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Working capital is a financial metric that represents the difference between a company's current assets and current liabilities. It is used to assess a company's short-term liquidity and operational efficiency. In calculating working capital, we focus on the **current assets**, which are assets that are expected to be converted into cash or used up within one year.

Among the options provided:

• Furniture and fittings: These are considered **fixed assets** or **non-current assets** because they are used over a long period and are not expected to be converted into cash within a year.
• Stock of raw material: This is a **current asset** because it is expected to be used or sold in the production process within a short period, typically less than a year. Thus, it is part of the calculation of working capital.
• Machinery: Similar to furniture and fittings, machinery is a **fixed asset** as it is used over many years and not sold or consumed within the short term.
• Office equipment: Like furniture and fittings, office equipment is also considered a **fixed asset** for similar reasons.

Therefore, the **stock of raw material** is used in calculating working capital because it is a **current asset**. Working capital is calculated using the formula:

Working Capital = Current Assets - Current Liabilities

In this formula, **current assets** would include items such as stocks of raw material, cash, accounts receivable, etc. As a result, stock of raw material is relevant for determining a company's ability to meet its short-term obligations and manage day-to-day operations.

The functions of public corporations include the following EXCEPT

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Public corporations are established primarily to serve the interests of society, offering critical services and contributing to the economic well-being of the community. Let's explore the functions mentioned:

• Providing essential services to the public: Public corporations often supply necessary services such as water, electricity, transportation, and healthcare. These services are fundamental for daily life and are provided regardless of the ability to pay.


• Providing even development: These corporations aim to facilitate balanced development across various regions, addressing inequalities by ensuring that all areas receive necessary investments and services. This helps in reducing regional disparities.


• Providing employment opportunities: Public corporations generate jobs by employing a large number of people. They offer both direct and indirect employment opportunities, thereby contributing to the overall employment rate of a country.


• Maximizing profits for the board members: Unlike private businesses that aim to generate profits for shareholders, public corporations are not primarily profit-oriented. Their main goal is to serve the public interest efficiently and effectively. Therefore, ensuring high profits for board members is generally not a function of public corporations.

In conclusion, the function that does not align with the objectives of public corporations is maximizing profits for the board members. These entities prioritize public service over profit maximization.

Which of the following is NOT an aim of advertising?

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Advertising primarily focuses on promoting products or services to potential customers. Here are typical aims of advertising:

• Inspiring public confidence in the goods: Advertising aims to build trust in a product, showing potential customers that it is reliable and worth purchasing.
• Arousing the interest of the public: It creates interest by informing people about the features and benefits of a product, making them curious or eager to try it.
• Attracting the attention of the public: Advertising uses various techniques to capture the audience's attention, making them aware of the product or service.

On the other hand, reducing the cost of the goods produced is NOT an aim of advertising. This is more associated with production processes and cost management strategies within a company. Advertising itself often incurs costs and does not directly reduce production expenses but is intended to increase sales and generate revenue, which can offset costs over time.