48 questions. Try each one, then open the answer to check yourself and read the explanation.
The type of labour that makes use of physical effort in production processes is the
Answer: A (unskilled labour.)
Unskilled labour needs no special training; it relies mainly on physical strength.
The final link in the chain of distribution is
Answer: C (consumer.)
Goods move from producer to wholesaler to retailer and finally to the consumer, the last link.
A country is said to be experiencing an unfavourable balance of trade if her
Answer: D (visible imports exceed visible exports.)
Balance of trade compares visible exports and imports; it is unfavourable when visible imports are more.
Trading position of Nigeria is the same as her
Answer: C (balance of trade.)
The balance of trade shows whether a country sells more goods abroad than it buys, which is its trading position.
The role of customs and excise authority includes the
Answer: C (control of the flow of goods in and out of the country.)
Customs checks goods entering and leaving the country, collects duties and stops smuggling.
The document lodged with the customs authorities before a ship can leave the port is a
Answer: C (ship manifest.)
The manifest lists all the cargo on board and must be given to customs before the ship is cleared to sail.
The document which must be endorsed by the ambassador of a country of destination before shipment of goods is a
Answer: A (consular invoice.)
A consular invoice is certified by the embassy or consulate of the importing country to confirm the goods and their value.
A country's terms of trade are said to improve when the ratio of her export
Answer: C (increases.)
Terms of trade = export prices ÷ import prices; when this ratio rises, each unit of exports buys more imports.
Which of the following advertising medium appeals to only the literate in the society?
Answer: B (Print media advertising.)
Newspapers and magazines must be read, so they reach only people who can read.
The two main forms of communication are
Answer: B (verbal and non-verbal.)
Communication is either verbal (in words, spoken or written) or non-verbal (signs, gestures, pictures).
The most reliable and efficient means of conveying urgent documents is through
Answer: D (courier services.)
Courier firms deliver documents quickly, door to door, and track them.
An undertaking given by a person to another assuring his integrity is
Answer: B (fidelity guarantee.)
Fidelity guarantee insurance protects an employer against loss from the dishonesty of employees.
Name | Insured Amount (₦) | Actual Value (₦) | Actual Loss (₦)
Mr. N | 25,000 | 100,000 | 30,000
Mr. R | 30,000 | 120,000 | 40,000
Mr. P | 40,000 | 150,000 | 50,000
If Mr. N takes a fire insurance policy with average clause, his compensation will be
Answer: B (₦7,500.)
Under average, pay = insured amount ÷ actual value × loss = 25 000/100 000 × 30 000 = ₦7 500.
Name | Insured Amount (₦) | Actual Value (₦) | Actual Loss (₦)
Mr. N | 25,000 | 100,000 | 30,000
Mr. R | 30,000 | 120,000 | 40,000
Mr. P | 40,000 | 150,000 | 50,000
What insurance principle has Mr. P violated if he decides to overstate the actual value of his property?
Answer: C (Uberrimae fidei.)
Uberrimae fidei (utmost good faith) requires the insured to state all facts truthfully.
The difference between indemnity insurance and non-indemnity insurance is that the latter provides
Answer: D (consolation payment to the insured.)
Life and injury cannot be valued in money, so non-indemnity policies pay an agreed sum as consolation, not to restore a loss.
An importance of warehousing is in the
Answer: A (production of goods.)
Warehouses store raw materials and finished goods so that production can go on all year.
In order to increase the capital owned, a sole trader may
Answer: D (draw less of his profit for personal use.)
Profit he leaves in the business adds to his own capital; loans and credit are borrowed, not owned.
A business partner who provides capital but abstains from participation in administration of a firm is a
Answer: D (dormant partner.)
A dormant (sleeping) partner puts in capital but takes no part in running the firm.
Which of the following will NOT be stated in a Memorandum of Association?
Answer: B (Rights of shareholders.)
The Memorandum has the name, registered office, objects, liability and capital clauses. Shareholders' rights are in the Articles.
The amount of authorized capital that shareholders have subscribed to is
Answer: A (issued share capital.)
Issued capital is the part of the authorised capital that has been offered to and taken up by shareholders.
The rate of turnover of a firm in a given year is 5 times while the average stock is ₦12,500. What is the turnover of the firm?
Answer: C (₦62,500.)
Turnover = 5 × 12 500 = ₦62 500.
A lawyer that defrauds his client may be derobed by the Nigerian Bar Association in order to
Answer: B (protect the integrity of the Association.)
Removing dishonest members keeps the profession's good name and public trust.
In the Nigerian GSM industry, a parliament is organized by the Nigerian Communication Commission in order to
Answer: D (protect the interest of consumers.)
The NCC's Telecom Consumer Parliament lets subscribers air complaints so their interests are protected.
Trade Fairs in Nigeria are organized by
Answer: D (Chambers of Commerce.)
Chambers of Commerce, such as the Lagos Chamber, run Nigeria's international trade fairs.
Money is generally acceptable for transactions due to
Answer: A (the legal backing.)
Money is legal tender: the law says it must be accepted in payment.
Which of the following is a quality of money?
Answer: B (Scarcity.)
Money must be relatively scarce; if anyone could get as much as they want, it would lose its value.
Money can simply be referred to as a
Answer: C (means of settlement.)
Money is simply anything that people generally accept in payment for goods and services and in settling debts. Measuring value is one of the things money does.
Gilt-edged securities are issued mainly by
Answer: C (Government.)
Gilt-edged securities are government stocks, very safe because government is unlikely to default.
The initial function of a manager is
Answer: C (planning.)
Before anything else a manager plans: he sets goals and decides how to reach them.
The most suitable organizational structure for small or medium-sized enterprises is
Answer: A (line structure.)
The simple line structure, with authority flowing straight down, suits small firms.
In a staff-authority relationship, the opinion of a specialist in one department to another is
Answer: B (an advice.)
Staff specialists only advise line managers; they cannot give them orders.
Management of a business involves the development of ideas for the
Answer: D (production of goods and services that satisfy human needs.)
Management plans and runs the whole business of producing goods and services that satisfy needs.
Which of the following is used as a pricing policy?
Answer: D (Market skimming.)
Skimming sets a high price at launch and lowers it later; it is a pricing policy.
The essential utility derived from the use of a product is known as
Answer: C (core benefit.)
The core benefit is the basic need the product meets, e.g. a phone lets you talk to people.
The breaking down of a market into separate and identifiable elements is known as
Answer: B (segmentation.)
Market segmentation divides a market into groups of buyers with similar needs.
A contract that is acknowledged before the law court is referred to as
Answer: C (contract of records.)
A contract of record is one made or acknowledged before a court, such as a judgment or a recognizance.
An agent employed to sell goods delivered to him by the principal is referred to as a
Answer: C (factor.)
A factor is given possession of the principal's goods and sells them in his own name for a commission.
A motor dealer who agreed to sell a car to Mr. X but sold and delivered it to Mr. Y on the delivery date agreed with Mr. X. He has discharged the contract by
Answer: D (breach.)
Failing to deliver to Mr. X as agreed is a breach of the contract.
A contract can be terminated through
Answer: C (frustration.)
A contract ends by frustration when something outside the parties' control makes it impossible to perform.
The right to retain possession of goods until the contract price is paid is referred to as
Answer: D (a lien.)
An unpaid seller's lien lets him hold on to the goods until the buyer pays.
The sole legal right held by the author to publish his book is a
Answer: B (copyright.)
Copyright gives the author the sole right to copy and publish his work.
The process of transferring data from one computer to another is referred to as
Answer: A (downloading.)
Downloading copies data from another computer (a server) to your own.
The physical component of a computer system is
Answer: B (hardware.)
Hardware is all the physical parts of a computer that you can touch.
A computer accessory through which information can be retrieved is the
Answer: D (floppy disk.)
A floppy disk is a removable storage accessory; data saved on it can be read back later.
The type of computer application software used mainly for management information is
Answer: C (data base.)
Database software stores and organises records so managers can search and report on them.
To meet security requirements before gaining access to data, a computer operator supplies
Answer: C (a password.)
A password proves the user is allowed to see the data.
A major factor that affects business operations is
Answer: A (technology.)
Technology changes how goods are made, sold and paid for, so it affects every business.
The environmental hazard that is most difficult to control is
Answer: C (air pollution.)
Polluted air spreads freely over wide areas and cannot be contained.