All 50 questions from the Joint Admissions and Matriculation Board (JAMB) Commerce 2008 Objective paper, with the correct answer and a full explanation for each. Free, no signup needed.
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1. An aspect of commerce that facilitates the distribution of products is
Transportation is the act of moving people and goods from one location to another, facilitating distribution.
2. An activity that involves derivation of raw materials from land and sea is
Extractive industry is the industry that deals in exploring raw materials from their original sources.
3. The art of soap-making is an example of
Soap making falls under manufacturing, which is a secondary occupation.
4. Given I. Shoe maker II. Policeman III. Fisherman IV. Gardener V. Broker. The persons engaged in primary occupation are
Primary occupation is engaged predominantly in extraction and agricultural activities - Fisherman (III) and Gardener (IV).
5. The process of changing the form of a raw material is known as
Production is the process of converting raw materials from one form to a more useful form.
6. In the long run, all factors of production are
In the long run, there will be no fixed factors; thus all factors will be variable.
7. The quality and quantity of production mostly depend on the
The quality and quantity of output usually depend largely on the effectiveness of factors of production.
8. The promotion of saving culture is a feature of a
Thrift cooperative society promotes savings habit in its members.
9. A document which gives a level status to a company is the certificate of
A certificate of incorporation gives an artificial body a legal status as an entity that can sue and be sued in its own name.
10. A proposed company may not be registered if
The Corporate Affairs Commission will not register a name if it conflicts with the name of another registered business.
11. An example of a cartel is
OPEC (Organisation of Petroleum Exporting Countries) is a form of cooperation among petroleum exporting countries to regulate output - a cartel.
12. The cheapest source of funds available to a company is through
Retained profit costs a company nothing to finance an expense, unlike other sources which involve some cost.
13. The components of capital employed in a business are
Capital employed is the amount used by a firm to generate profit; it comprises owners' equity and long-term liabilities.
14. Maimani Plc, whose nominal capital is made up of 5,000,000 ordinary shares of 50k each, decided to offer 80% of it to the public and realized only 50% of the amount due. What is the company's authorized share capital?
Authorised share capital = N0.50 x 5,000,000 = N2,500,000.
15. Determine the company's reserve share capital.
Since 80% has been issued, the remaining 20% x 5,000,000 x N0.50 = N500,000.
16. In order to prevent liquidity problems in commercial banks, the central bank uses
Reserve ratio specifies the amount of deposit a commercial bank must keep in its vault; raising it prevents liquidity problems.
17. The account maintained with a commercial bank for the purpose of foreign exchange transaction is the
A domiciliary account is maintained with a bank to enable use of foreign currency such as dollars in Nigeria.
18. A trader who gives credit stands to enjoy
When a trader gives credit, more buyers tend to come to him/her for their purchases, increasing sales.
19. A person who buys new issues with a view of re-selling at a higher price in the near future is referred to as a
A stag is a stock market speculator who buys a holding expecting a quick short-term rise in value, then sells for profit.
20. A source of capital that has both elements of debt and equity is a
A share is a unit of ownership in a limited liability company; it serves as equity but the holder can also withdraw shares, acting like debt.
21. A type of retail trade where a group of similar stores which is owned by a firm operates in different locations is a
A chain store is a group of similar retail shops selling the same type of goods, all under the control of a head office.
22. A warehouse which is used to store goods whose custom duty is not yet paid is a
A bonded (customs-controlled) warehouse is used for retention of imported goods until the duty owed is paid.
23. Balance of payments is made up of
Balance of payment is the difference between all import payments and export receipts, including visible goods and invisible services.
24. Most of the barriers to international trade have been eliminated through
Globalisation is the act of making the whole world an economic village, removing forms of restrictions to trade.
25. A document sent by a seller to inform a buyer about the prices of goods is the
A proforma invoice is sent to a prospective buyer to notify them of the prices of goods they intend to order.
26. When 'FOB' is written on a document, it implies that the buyer bears the
FOB (Free on Board) indicates the buyer bears the cost of insurance and transport once goods are loaded on the ship.
27. A crossed cheque with the inscription 'not negotiable' must be paid into the
A crossed cheque marked 'not negotiable' must be paid into the current account of the payee.
28. The pooling of business information for the benefit of members is a major function of a
Trade associations aim at promoting the trade line by conducting market research on behalf of members.
29. An association to which all chambers of commerce in Nigeria are affiliated is the
NACCIMA (National Association of Chambers of Commerce, Industry, Mines and Agriculture) combines all chambers of commerce in Nigeria.
30. The resources which are necessary for business development include
Resources are all inputs needed by an organisation to continue operations - man, materials, money and machines.
31. The four Ps of marketing are
The 4Ps of the marketing concept are price, product, place and promotion.
32. Personal selling is used for the purpose of
Personal selling enables the seller to educate the buyer/user with technical information about the product.
33. Ships used for international transport are
Ocean liners are used for international transport on sea.
34. A function generally performed by authorities of both the air and sea ports is the
Both the seaport and airport authority must provide facilities that aid loading and offloading of cargoes.
35. A major factor hindering effective communication process is
Noise is any disturbance that can affect effective communication.
36. The fear of many communities concerning tourism development is the
Through tourism, foreign culture can easily be transmitted to locals, changing their cultural values.
37. The development of tourism in Nigeria will enhance
If tourism is developed, more revenue will be generated through tourists.
38. A historical building is a feature of
An historical building forms part of the culture of the people, hence it is cultural tourism.
39. The sum of money paid by a policyholder to an insurer is referred to as
Premium is the periodic amount paid by a policyholder to an insurance company to be entitled to indemnity in case of loss.
40. An example of a non-insurable risk is
A risk can be insured if there is an attached probability. Speculation has no attached probability, thus it is not insurable.
41. The coordinating section of the central processing unit that manages the flow of data is the
The control unit of the CPU is responsible for the flow of data in the computer system.
42. An agreement between two parties which is enforceable by law is a
A contract is an agreement between two parties to carry out a specified responsibility, enforceable under the law.
43. The implied provisions in every sale of goods as contained in the Sales of Goods Act of 1893 are conditions and
Every sales agreement assumes the goods are in good condition and there is a guaranty that it can serve its purpose.
44. When an employee incurs expenses while executing his normal duty, the employer is responsible for his
All costs incurred by an employee while discharging duty must be compensated (indemnified) by the employer.
45. The body charged with divesting government interest in public enterprises is
BPE (Bureau for Public Enterprises) oversees public enterprises and recommends commercialisation or privatisation.
46. The practice whereby government relinquishes its ownership interest in a public enterprise is
When government relinquishes its interest in a public enterprise to private individuals, it is said to have privatised the enterprise.
47. A factor in a business environment which increases the rate of product obsolescence is
Technology is the major factor that causes product obsolescence, as new technology makes older versions obsolete.
48. Which of the following is a form of social responsibility of a business?
Social responsibility refers to non-primary efforts made by a firm to maintain a close relationship with its environment.
49. A computer component that decodes and interprets instructions and also directs program implementation is
The Central Processing Unit processes input accepted, decodes and interprets it, and works on it.
50. Which software program is most useful for generating financial/accounting reports for an organisation?
MS Excel is more useful for accounting-type reports in organisations than other MS Office tools.
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