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Free JAMB Past Question for commerce
Q.1Which of the following is an example of an e-commerce activity?
A. Transferring money between bank accounts using a mobile app.
B. Sending an email to a business partner.
C. A company selling products to customers through its website.
D. Using a word processor to write a business report.
Which of the following is an example of an e-commerce activity?
A. Transferring money between bank accounts using a mobile app.
B. Sending an email to a business partner.
C. A company selling products to customers through its website.
D. Using a word processor to write a business report.
Correct Answer: option c
Further reading: ICT activities
Show explanation
E-commerce specifically refers to the buying and selling of goods and services over electronic networks, primarily the internet. Other options relate to e-banking, communication, and general computer use
Q.2What is the primary role of a Bureau de Change in the Nigerian economy?
A. Regulating the banking sector.
B. Issuing new currency notes.
C. Facilitating foreign currency exchange at market-determined rates.
D. Providing long-term loans to businesses.
What is the primary role of a Bureau de Change in the Nigerian economy?
A. Regulating the banking sector.
B. Issuing new currency notes.
C. Facilitating foreign currency exchange at market-determined rates.
D. Providing long-term loans to businesses.
Correct Answer: option c
Further reading: The role of Bureau de Change in an economy
Show explanation
A Bureau de Change is a licensed business that buys and sells foreign currencies, providing a service for individuals and businesses who need to convert currency for travel, trade, or other purposes.
Q.3The principle of management that states that the number of subordinates a manager can effectively supervise is known as:
A. Unity of command
B. Span of control
C. Delegation of authority
D. Chain of command
The principle of management that states that the number of subordinates a manager can effectively supervise is known as:
A. Unity of command
B. Span of control
C. Delegation of authority
D. Chain of command
Correct Answer: option b
Further reading: Principles of management (span of control)
Show explanation
Span of control refers to the number of employees a manager is responsible for. A narrow span of control means a manager oversees few employees, while a wide span of control means they oversee many
Q.4The purpose of a proforma invoice is to:
A. Serve as a legal document for payment after a sale.
B. Request payment for goods that have been shipped.
C. Provide a preliminary bill to the buyer before the final transaction.
D. Document the goods that have been received by the buyer.
The purpose of a proforma invoice is to:
A. Serve as a legal document for payment after a sale.
B. Request payment for goods that have been shipped.
C. Provide a preliminary bill to the buyer before the final transaction.
D. Document the goods that have been received by the buyer.
Correct Answer: option c
Further reading: Documentation in the purchase and sale of goods
Show explanation
A proforma invoice is a draft invoice that is sent to a buyer before the goods are shipped. It outlines the details of the sale, such as the price, quantity, and delivery terms, allowing the buyer to arrange for payment or obtain necessary approvals
Q.5Which of the following is a disadvantage of a wholesaler to a retailer?
A. They allow retailers to buy in small quantities.
B. They offer retailers a wide variety of goods.
C. They may delay the delivery of goods.
D. They provide credit facilities to retailers.
Which of the following is a disadvantage of a wholesaler to a retailer?
A. They allow retailers to buy in small quantities.
B. They offer retailers a wide variety of goods.
C. They may delay the delivery of goods.
D. They provide credit facilities to retailers.
Correct Answer: option c
Further reading: Advantages and disadvantages of wholesalers
Show explanation
While wholesalers provide many benefits, delays in delivery can be a disadvantage, potentially leading to a loss of sales for the retailer and frustrating customers
Q.6A major trend in modern retailing is the use of vending machines. What is the primary advantage of vending machines for a retailer?
A. They can sell a wide variety of goods.
B. They offer personalized customer service.
C. They operate continuously without the need for an attendant.
D. They eliminate the need for any form of advertising.
A major trend in modern retailing is the use of vending machines. What is the primary advantage of vending machines for a retailer?
A. They can sell a wide variety of goods.
B. They offer personalized customer service.
C. They operate continuously without the need for an attendant.
D. They eliminate the need for any form of advertising.
Correct Answer: option c
Further reading: Trends in retailing
Show explanation
Vending machines provide a 24/7 sales channel, allowing retailers to sell products at any time and in locations where it may not be feasible to have a physical store or an employee. This significantly reduces labor costs.
Q.7Which of the following documents represents an ownership stake in a company?
A. Debenture
B. Bond
C. Stock/Share
D. Treasury bill
Which of the following documents represents an ownership stake in a company?
A. Debenture
B. Bond
C. Stock/Share
D. Treasury bill
Correct Answer: option c
Further reading: Types of securities
Show explanation
A stock or share represents a unit of ownership in a company. Debentures and bonds, on the other hand, represent a loan made to the company
Q.8A major advantage of road transportation in Nigeria is its flexibility. However, what is its main disadvantage compared to rail or air transportation?
A. It is the most expensive mode of transport for bulky goods.
B. It is limited to specific routes and schedules.
C. It is generally slower over long distances.
D. It has a higher capacity for carrying goods and people.
A major advantage of road transportation in Nigeria is its flexibility. However, what is its main disadvantage compared to rail or air transportation?
A. It is the most expensive mode of transport for bulky goods.
B. It is limited to specific routes and schedules.
C. It is generally slower over long distances.
D. It has a higher capacity for carrying goods and people.
Correct Answer: option c
Further reading: Modes of transportation, advantages and disadvantages
Show explanation
While road transport is flexible, it is significantly slower for long distances compared to air transport and less efficient for carrying very bulky goods than rail or sea transport.
Q.9Which of the following is a barrier to foreign trade?
A. Government subsidies
B. Free trade agreements
C. Embargoes and quotas
D. Foreign exchange markets
Which of the following is a barrier to foreign trade?
A. Government subsidies
B. Free trade agreements
C. Embargoes and quotas
D. Foreign exchange markets
Correct Answer: option c
Further reading: Barriers to international trade
Show explanation
An embargo is a complete ban on trade with a particular country, while a quota is a limit on the quantity of a certain good that can be imported or exported. Both are significant barriers to international trade.
Q.10What is the primary function of a Stock Exchange?
A. To provide loans to companies.
B. To regulate the banking industry.
C. To facilitate the buying and selling of securities.
D. To act as a central bank for the government.
What is the primary function of a Stock Exchange?
A. To provide loans to companies.
B. To regulate the banking industry.
C. To facilitate the buying and selling of securities.
D. To act as a central bank for the government.
Correct Answer: option c
Further reading: Functions of the Stock Exchange
Show explanation
The Stock Exchange is a formal marketplace where investors can buy and sell financial instruments like stocks, shares, and bonds. This provides liquidity for investors and allows companies to raise capital.
Q.11An agreement where one party grants another the right to use their intellectual property (e.g., brand name, patents) in return for a fee is known as:
A. Hire purchase
B. Consignment
C. Agency
D. Licensing
An agreement where one party grants another the right to use their intellectual property (e.g., brand name, patents) in return for a fee is known as:
A. Hire purchase
B. Consignment
C. Agency
D. Licensing
Correct Answer: option d
Further reading: Legal aspects of business
Show explanation
Licensing is a legal agreement where a business (the licensor) allows another business (the licensee) to use its intellectual property under specific terms and conditions, typically in exchange for a royalty payment.
Q.12Which of the following best describes the political environment of a business?
A. The cultural beliefs and values of a society.
B. The legal and regulatory framework for businesses.
C. Government policies, political stability, and laws.
D. The level of economic growth and inflation.
Which of the following best describes the political environment of a business?
A. The cultural beliefs and values of a society.
B. The legal and regulatory framework for businesses.
C. Government policies, political stability, and laws.
D. The level of economic growth and inflation.
Correct Answer: option c
Further reading: Types of business environments
Show explanation
The political environment includes government policies, political stability, and the political system in a country, all of which can significantly influence how a business operates.
Q.13A car manufacturer places an advertisement on a national television network during primetime. What type of advertising medium is this?
A. Direct mail
B. Print media
C. Broadcast media
D. Outdoor advertising
A car manufacturer places an advertisement on a national television network during primetime. What type of advertising medium is this?
A. Direct mail
B. Print media
C. Broadcast media
D. Outdoor advertising
Correct Answer: option c
Further reading: Types and media of advertising
Show explanation
Broadcast media includes television and radio, which transmit advertisements to a wide audience through airwaves. Direct mail and print media are examples of different advertising categories.
Q.14A farmer cultivating cassava for commercial purposes is engaged in what type of production?
A. Secondary production
B. Tertiary production
C. Quaternary production
D. Primary production
A farmer cultivating cassava for commercial purposes is engaged in what type of production?
A. Secondary production
B. Tertiary production
C. Quaternary production
D. Primary production
Correct Answer: option d
Further reading: Types of production
Show explanation
Primary production involves the extraction or harvesting of raw materials from the natural environment. Farming, fishing, and mining are all examples of primary production.
Q.15The practice of a business acting in a way that benefits society and the environment, beyond its legal obligations, is known as:
A. Profit maximization
B. Philanthropic consideration
C. Market segmentation
D. Tax evasion
The practice of a business acting in a way that benefits society and the environment, beyond its legal obligations, is known as:
A. Profit maximization
B. Philanthropic consideration
C. Market segmentation
D. Tax evasion
Correct Answer: option b
Further reading: Social responsibility
Show explanation
Philanthropic and societal considerations are part of a business's social responsibility. This includes actions like donating to charity, supporting community projects, and engaging in environmentally friendly practices
Q.16What is the primary challenge faced by commercial banks in Nigeria?
A. Over-regulation by the government.
B. Low customer base and lack of deposits.
C. High levels of non-performing loans and fraud.
D. Lack of modern technology for transactions.
What is the primary challenge faced by commercial banks in Nigeria?
A. Over-regulation by the government.
B. Low customer base and lack of deposits.
C. High levels of non-performing loans and fraud.
D. Lack of modern technology for transactions.
Correct Answer: option c
Further reading: Challenges of banking
Show explanation
Non-performing loans (NPLs), where borrowers default on their payments, and various forms of fraud are significant challenges for banks in Nigeria, impacting their profitability and stability
Q.17The term 'C.I.F.' is a trade term that means the seller is responsible for the cost, insurance, and freight of the goods to the destination port. Which of the following is the buyer responsible for under this term?
A. Only the freight charges.
B. All costs until the goods reach the port.
C. All costs after the goods are delivered to the destination port.
D. The cost of the goods and the insurance.
The term 'C.I.F.' is a trade term that means the seller is responsible for the cost, insurance, and freight of the goods to the destination port. Which of the following is the buyer responsible for under this term?
A. Only the freight charges.
B. All costs until the goods reach the port.
C. All costs after the goods are delivered to the destination port.
D. The cost of the goods and the insurance.
Correct Answer: option c
Further reading: Terms of trade
Show explanation
Under C.I.F., the seller's responsibility ends once the goods are on board the ship and the insurance and freight have been paid. The buyer then takes on the risk and all subsequent costs, including unloading and transport to the final destination.
Q.18A country's balance of trade is determined by the difference between the value of its:
A. Total exports and total imports.
B. Invisible exports and invisible imports.
C. Visible exports and visible imports.
D. Capital inflows and capital outflows.
A country's balance of trade is determined by the difference between the value of its:
A. Total exports and total imports.
B. Invisible exports and invisible imports.
C. Visible exports and visible imports.
D. Capital inflows and capital outflows.
Correct Answer: option c
Further reading: Basic issues in foreign trade
Show explanation
The balance of trade specifically refers to the difference in value between a country's visible exports (physical goods) and its visible imports (physical goods) over a period. It's a component of the broader balance of payments.
Q.19A business owned and managed by a single individual with unlimited liability is known as a:
A. Partnership
B. Limited Liability Company
C. Public Corporation
D. Sole Proprietorship
A business owned and managed by a single individual with unlimited liability is known as a:
A. Partnership
B. Limited Liability Company
C. Public Corporation
D. Sole Proprietorship
Correct Answer: option d
Further reading: Forms and features of business units
Show explanation
A sole proprietorship is a business run by one person, where there's no legal distinction between the owner and the business. This means the owner is personally responsible for all business debts and liabilities.
Q.20A person purchases a fire insurance policy for their house. Which insurance principle requires that the insured has a financial stake in the property?
A. Utmost good faith
B. Indemnity
C. Insurable interest
D. Subrogation
A person purchases a fire insurance policy for their house. Which insurance principle requires that the insured has a financial stake in the property?
A. Utmost good faith
B. Indemnity
C. Insurable interest
D. Subrogation
Correct Answer: option c
Further reading: Principles of insurance
Show explanation
The principle of insurable interest states that the policyholder must be in a position to suffer a financial loss if the insured event occurs. You can't insure a property you don't own because you would have no financial interest in it.