Commerce JAMB Questions CBT Practice Questions & Answers 2021 Set 1

1. A partnership may be automatically dissolved due to the following factors except________

A. Court verdict
B. Joint decision
C. Admission of new partners
D. Bankruptcy of a partner

Correct Answer: Option C

Explanation

Dissolution of partnership is the coming to an end of a partnership agreement, i.e the breakup of a partnership business.

2. One of the disadvantages of Sole Proprietorship is__________

A. It requires small operations
B. It involves small capital
C. It lacks specialization
D. Grants from government

Correct Answer: Option C

Explanation

The lack specialization because the owner is personally involved in every section of the business.

3. In the formation of a united liability company, the following documents are prepared except_______

A. Memorandum of Association
B. Article of Association
C. Statement of Nominal Capita
D. Prospectus

Correct Answer: Option D

Explanation

A prospectus is an invitation to the public to purchase shares or debentures. It is most often issued by public limited companies.

4. The process of winding up or bringing a company to an end is________

A. Dissolution
B. Liquidation
C. Integrating
D. Merger

Correct Answer: Option B

Explanation

Liquidation is the termination of a company when it has completed the business for which it was created.

5. Use the following information to answer this question.

The following is a summary of the asset and liabilities of Ojo trading company as at 31st December, 2018

Initial Capital	5000
Net Profit	1000
Furniture	2000
Equipment	2900
Debtors	100
Stock	1000
Bank	500

From the above, calculate Current assets

A. 1600
B. 1060
C. 1500
D. 600

Correct Answer: Option A

Explanation

Current Assets	N
Debtors	100
Stock	1000
Bank	500
	1600

6. The following is a summary of the asset and liabilities of Ojo trading company as at 31st December, 2018

Initial Capital	5000
Net Profit	1000
Furniture	2000
Equipment	2900
Debtors	100
Stock	1000
Bank	500

From the above, calculate Fixed assets

A. 6500
B. 2000
C. 4900
D. 600

Correct Answer: Option C

Explanation

Fixed Assets	N
Furniture	2000
Equipment	2900
	4900

7. The following is a summary of the asset and liabilities of Ojo trading company as at 31st December, 2018

Initial Capital	5000
Net Profit	1000
Furniture	2000
Equipment	2900
Debtors	100
Stock	1000
Bank	500

From the above, calculate Current liabilities

A. 100
B. 6000
C. 600
D. 3000

Correct Answer: Option C

Explanation

From accounting equation;

Assets = Capital + liabilities

Therefore, liabilities = Assets - Capital

Liabilities = (4900 + 1600) - (500 + 1000) = 6500 - 6000

⇒ ₦600

8. In a law of contract, what is given in exchange for a promise to perform is_____

A. offer
B. acceptance
C. warranty
D. consideration

Correct Answer: Option D

Explanation

Consideration is one of the valid element of a contract. It is the price for which a promise is bought.

9. In Nigeria, it is mandatory for all business enterprises to be registered with the________

A. Government
B. Corporate Affairs Commission
C. Agent
D. Enterprise

Correct Answer: Option B

Explanation

All businesses must be registered with the Corporate Affairs Commission and a certificate of incorporation will be issued to any business incorporated.

10. All but one does not provide an Indirect Service?

A. Custom Officers
B. Family Doctors
C. Civil Servants
D. Law Makers

Correct Answer: Option A

Explanation

Indirect service are services rendered to the general public but they are not paid by the members of the public directly. The government will pay them from taxes and levies paid by the public.

11. Examples of Commercial occupation are all except___________

A. Bankers
B. Traders
C. Insurers
D. Goldsmith

Correct Answer: Option D

Explanation

Commercial occupation are those activities involved in the distribution and exchange of goods and services.

12. All but one is not an output devices?

A. Joystick
B. Monitor
C. Plotter
D. Printer

Correct Answer: Option A

Explanation

An output device is a device that can use to receive processed information from the computer system through either voice or hard-copy.

13. A self-contained chunk of code with principal aim to replies preferably undetected and to copy itself into the computer's memory and the computer's hard-disk is_________

A. Hardware
B. Software
C. Computer remedies
D. Virus

Correct Answer: Option D

Explanation

A virus usually interferes with operating system, corrupts program and data files when the virus is on computer memory.

14.The risks that can be forecast and measured is termed___________

A. Gambling
B. Insurable risks
C. Non-Insurable risks
D. Indenmity Insurance

Correct Answer: Option B

Explanation

Insurable risks are the type of risks that is possible to collect, calculate and estimate the likely future losses.

15. The type of insurance policy that is compulsory in International trade so that all goods passing through the sea must be covered is considered to be________

A. The type of insurance policy that is compulsory in International trade so that all goods passing through the sea must be covered is considered to be
B. Aviation Insurance
C. Marine Insurance
D. Life Assurance

Correct Answer: Option C

Explanation

Marine Insurance covers losses or liabilities relating to ship and their cargnes or liabilities relating to ship and against the dangers or perils of the sea.

16. Thee major aim of consumer orientation is_________

A. consumer satisfaction
B. consumer sovereignty
C. what to produce
D. market research

Correct Answer: Option A

Explanation

Consumer orientation is the concept of marketing which begins and ends with the needs and wants of the consumers rather than that of the organisation.

17. The policy used when contracts are awarded as a result of tender is________

A. market penetration
B. market skimming
C. Bid Pricing
D. Product Line Pricing

Correct Answer: Option C

Explanation

Bid pricing is used mostly in government contracts. If the object is to obtain the contract, cost will be considered mainly to determine the level of Minimum Price.

18. One of these is not a major in the production process?

A. Producers
B. Distributors
C. Marketers
D. Consumers

Correct Answer: Option C

Explanation

It should be noted that production is said to be complete when goods and services produced get to the final users or consumers. The production process involves: Producers, distributors and consumers.

19. Examples of consumer goods include all except________

A. Nurse
B. Cars
C. Spoon
D. Shoes

Correct Answer: Option B

Explanation

Consumer goods are goods and services that can satisfy the consumer's immediate needs. These goods do not require further process of production for their use by the consumers.

20. The most important resources of business is_______

A. Human resources
B. Money resources
C. Material resources
D. Opportunities

Correct Answer: Option A

Explanation

Human resources is the most important resources because it plans, controls, organises and co-ordinates all other resources to achieve maximum efficiency.

21. A business environment that take into consideration the beliefs, attitudes, needs, values and attitudes of the people is_________

A. Economic environment
B. Technological environment
C. Political environment
D. Cultural environment

Correct Answer: Option D

Explanation

The cultural environment look into lifestyles of the people and the attitudes of the people.

22. An example of vertical integration is___________

A. Trust
B. Cartel
C. Merger
D. Price Ring

Correct Answer: Option A

Explanation

Trust is an amalgation of different competing firms in different lines of business under a single management. It is vertically integrated in nature.

23. A company which another company is a member and control the board of directors or hold more than half of its equity is termed_______

A. Subsidiary
B. Syndicate
C. Holding Company
D. Parent company

Correct Answer: Option A

Explanation

Subsidiary is a company in which a holding firm has controlling interest by acquiring more than 51% of its share.

24. The theory of International trade is based on_________

A. Principles of management
B. Principles of comparative cost
C. Principle of double entry
D. Theory of migration

Correct Answer: Option B

Explanation

International trade is based on the principle of comparative cost advantage that was propounded by David Ricardo in the 19th century.

25. A fall in the value of a country's currency vis-a-vis other currencies is known as__________

A. Depreciation
B. Reduction
C. Devaluation
D. Exchange rate

Correct Answer: Option C

Explanation

Devaluation is the lowering of the exchange value of a country's currency against other currencies. This makes import to be expensive and import to be more attractive.

26. A market is said to be bullish if_________

A. There is a fail in prices of Securities
B. There is a rise in prices of Securities
C. There is a rise above the offer prices
D. The speculator fails to deliver stock to the buyer

Correct Answer: Option B

Explanation

A market is said to be bullish if it is keen to buy. It is associated with the Bull who wait for a time of general rise in prices of securities.

27.One of these is not a factor affecting prices of securities?

A. The Forces of demand and supply
B. Activities of speculators
C. Political situation of a country
D. Financial statements of the company

Correct Answer: Option D

Explanation

Securities are investments which are traded in the stock exchange in order to yield income.

28. A commission charged on postal order is__________

A. postal zero
B. postal orders
C. poundage
D. brokage

Correct Answer: Option C

Explanation

Poundage is a commission paid or charged on postal order. The sender fills the name of the person to be paid and can only be cashed by him.

29. A terms of payment in which the buyer pays cash immediately for goods bought before he takes them away is called____

A. Prompt cash
B. Cash on delivery
C. Spot cash
D. Cash with order

Correct Answer: Option C

Explanation

A spot price is the price that is the current price and at which the instant delivery takes place. Spot payment or price is the same as the market price.

30. A cheque that is payable to whoever presents it is known as______

A. order cheque
B. open cheque
C. crossed cheque
D. bearer cheque

Correct Answer: Option D

Explanation

Bearer cheque is payable to the bearer i.e whoever presents it. It is cashed over the counter without having to be endorsed by the person presenting it.

31. A two-way process which involves sending and receiving of messages is referred to as__________

A. Advertisement
B. Communication
C. Marketing
D. Transportation

Correct Answer: Option B

Explanation

Communication is the process of exchange or transmission of meaningful information, feelings, opinions and ideas from one person to another. It is a two-way process which involve the source (sender) an the receiver.

32. The scope of commerce is limited to________

A. home and foreign trade
B. wholesaler and retail trade
C. trade and aids to trade
D. wholesale and entreport trade

Correct Answer: Option C

Explanation

Commerce scop embraces trade and aids to trade.

33. All but one is not a demerit of advertising?

A. It leads to monopoly
B. Buyers can buy unnecessarily
C. Increase in profit
D. High cost

Correct Answer: Option C

Explanation

Advertising increases the profitability of an organisation.

34. Advantages of pipeline transport include all except_______

A. Low maintenance cost
B. It is safe
C. Continuous Flow of goods
D. Prone to leakages

Correct Answer: Option D

Explanation

Pipe line transportation can be prone to leakages and authorised tapping by the people, as is the case in the Niger Delta.

35. The factors to be considered in setting up retail trade include all except_____

A. Capital
B. Experience
C. Location
D. Age

Correct Answer: Option D

Explanation

In setting up a retail trade, age is not a factor to be considered.

36.A responsibility to control environmental pollution is the responsibility of____

A. The business
B. The government
C. The consumer
D. The employee

Correct Answer: Option A

Explanation

A business has a responsibility to control environmental pollution e.g water, land, sound and air pollution arising from their operations.

37. The following development of money have therefore been the use of, except______

A. Coins
B. Inconvertible paper money
C. Commodities
D. Abacus

Correct Answer: Option A

Explanation

Domestic Tourism, Involving residents of the given country travelling only within this country.

38.Tourism involving residents of the given country travelling only within this country is called__________

A. Domestic Tourism
B. Inbound Tourism
C. Outbound Tourism
D. Traveller's Tourism

Correct Answer: Option B

Explanation

The NBC was established in Oct 1963 and the headquater of the commission is located in Niamey, Niger Republic.

39. The headquarters of Niger Basin Commission is located at________

A. Abuja
B. Niamey
C. Lome
D. Nojamena

Correct Answer: Option B

Explanation

The NBC was established in Oct 1963 and the headquater of the commission is located in Niamey, Niger Republic.

40. A document which entitles its holder to the gods named on it, which is stored in a specific warehouse is called________

A. Debit note
B. Credit note
C. Warrant
D. Shipping note

Correct Answer: Option C

Explanation

A warrant allows the goods to be released when duties have een paid and the authority concerned issue out warehouse warrant for it.

41. The difference between Articles of association and memorandum of Association is that the latter deals

A. with the Internal working relationship of the company and its members
B. with the powers and relationships of the company with outsiders
C. The method of issue, transfer and future of the company's shares
D. The rights and responsibilities of shareholders

Correct Answer: Option B

Explanation

Memorandum of Association contains what is generally called the "external" rules of the company. They refer to the objectives of the company and hold it intends to interact with the public.

42. All except one is not a corporation and boards at the federal level

A. FRCN
B. NNPC
C. CBN
D. MAN

Correct Answer: Option B

Explanation

Memorandum of Association contains what is generally called the "external" rules of the company. They refer to the objectives of the company and hold it intends to interact with the public.

43. The basic characteristics of co-operative society include all except one

A. It is managed democratically
B. It follows the principle of one man
C. Amateur Management
D. Extra capital is raised through loan

Correct Answer: Option C

Explanation

Members in the management committees of Co-operative societies often lack business experience and expertise.

44. The basic characteristics of co-operative society include all except one

A. It is managed democratically
B. It follows the principle of one man
C. Amateur Management
D. Extra capital is raised through loan

Correct Answer: Option C

Explanation

Members in the management committees of Co-operative societies often lack business experience and expertise.

45. Which of the limited liability companies have a limit of fifty members and do not issues their shares to the public

A. Private limited liability
B. Public limited liability
C. Partnership
D. Co-operative society

Correct Answer: Option A

Explanation

A private limited liability company is a profit making business with few shareholders and no open market for its shares. The minimum number of shareholders is two and the maximum number is fifty.

Use this information to answer this question. Below is the trading, profit and loss Account particulars of Amadi peterside and Brothers for the year ended 31st December 1986.

₦

Opening stock

Purchase

1000

7000

Sales

8000

Closing Stock

3000

Trading Expenses

Electricity

Salaries

Rent

Depreciations

₦

135

875

180

210

From the figures given, calculate

Gross profit

A. 300
B. 3000
C. 6000
D. 11000

Correct Answer: Option B

Explanation

Gross profit = Sales - Cost of goods sold

Cost of goods sold = Opening + Purchases - Closing stock = 1000 + 7000 - 3000

⇒ 6000

Therefore, Gp = 8000 - 6000 = 3000

47 Net profit

A. 1400
B. 5000
C. 1600
D. 6400

Correct Answer: Option C

Explanation

Net profit = Gross profit - Expenses

3000 - 1400 = 1600

48. Percentage of net profit to turnover

A. 30%
A. 5%
B. 10%
D. 20%

Correct Answer: Option D

49. An offer extended to several people at once is called

A. Acceptance
B. Offeror
C. Invitation to threat
D. Consideration

Correct Answer: Option C

Explanation

An invitation to treat is extended to several people at once. It is different from an offer e.g Goods displayed in a shelve.

50. A conter offer is an offer that is

A. different from the original offer
B. breached
C. different in terms of acceptance
D. extended to several people at once

Correct Answer: Option A

Explanation

A counter offer is an offer that is different from the original offer e.g Mr A said to Mr B, I will sell you the hat for ₦100 but Mr B replied, I will buy it for ₦80 is an example of a counter offer

51. Services are made up of

A. visible and invisible
B. Industry and Commerce
C. direct and indirect services
D. Goods and Services

Correct Answer: Option C

Explanation

Services are made up of direct services and indirect services.

52. The assembling of Manufactured products into forms usable by humans is classified as

A. Extraction occupation
B. Construction occupation
C. Manufacturing occupation
D. Industrial occupation

Correct Answer: Option B

Explanation

Construction occupation is the assembling of manufactured products into forms e.g The building of houses is done by assembling bricks, tiles, door frames, window, frames, ceiling boards e.t.c

53. Computer that process data in the form of values is

A. Digital
B. Hybrid
C. Digital-hybrid
D. Analog

Correct Answer: Option D

Explanation

Analog computers are those computers that are similar to use for measuring instruments such as Thermometer, Voltmeter i.e measured in value and scale.

54. A memory that can be read and write and is volatile is known as

A. RAM
B. ROM
C. EPROM
D. EPPROM

Correct Answer: Option A

Explanation

Random Access Memory (RAM) are the most widely used primary storage medium. It can both sensed (read) and changed (written).

55. You have just bought a new car. What Insurance policy will you take to cover it?

A. Accident Insurance
B. Fire Insurance
C. Marine Insurance
D. Fidelity Guarantee Insurance

Correct Answer: Option A

Explanation

Accident Insurance provides for compensation against injuries or hazards which may be due to a person or group of persons. It covers motor vehicle insurance as well.

56. A document that embody the conditions and exceptions attached to the contract is

A. proposal form
B. cover note
C. the policy
D. insurance certificate

Correct Answer: Option C

Explanation

The policy is the document containing full particulars of the Insured and the Subject matter of the Insurance.

57. The communication aspect of the marketing mix is

A. Price
B. Promotion
C. Place
D. Product

Correct Answer: Option B

Explanation

Promotion mix deals with how the business enterprise informs the consumer about the existence and the qualities of its products.

58. Any information about a manufacturer or his product that appears in any medium on a non-paid basis is known as

A. Sales Promotion
B. Personal Selling
C. Advertising
D. Publicity

Correct Answer: Option D

Explanation

Publicity is one of the forms of promotion. Publicity attracts an audience which sees or hears commercial messages paid for by eager advertisers.

59. All activities that contribute towards making goods and services available to the people are

A. Economic activities
B. Political activities
C. Productive activities
D. Business activities

Correct Answer: Option C

Explanation

People are always producing goods and services. Production activities go on in all parts of the world.

60. Which of these is not a merit of division of labour

A. results in specialization
B. brings about an element of automation
C. Training in new jobs is facilitated
D. Creates monotony in the work force

Correct Answer: Option D

Explanation

Monotony of work is a demerit of division of labour because workers engages in the same tasks day-in and day out, after some time, he gets bored.

61. Which of these is not a merit of division of labour

A. results in specialization
B. brings about an element of automation
C. Training in new jobs is facilitated
D. Creates monotony in the worktask

62. The function of management that establish objectives for the organization and trying to determine the best ways to accomplish them

A. organizing
B. planning
C. directing
D. controlling

63. The provision of qualified managerial and other skilled personnel for an enterprise is called

A. Directing
B. Controlling
C. Planning
D. Staffing

64. A number of shipping lines operating on a certain route, which agree on a common policy regarding the conditions under which goods are to be carried

A. Cartel
B. Conference
C. Syndicate
D. Trust

65. The difference between a chamber of commerce and a trade association is that the former

A. is not restricted to a particular industry
B. is a branch of trade that sells product
C. consists of members engaged in the same trade
D. are association of individuals or firm

66. Which of these is a document used in International trade?

A. Debit note
B. Credit note
C. Invoice
D. Price ring

67. All but one is not a barriers to foreign trade

A. Natural Barriers
B. Economic Barriers
C. Social and Language Barriers
D. Trade Fair

68. The difference between the buying price and the selling price of a share is referred to as

A. Commission
B. Profit
C. Jobber's Profit
D. Turnover

69. A bear market is said to be in existence in a period of

A. Boom
B. Stump
C. Bullish
D. Stagflation

Use the following information to answer this question.

Oladosu Bookshop

54, Ahmadu Bello Way

Kaduna

P.O.BOOX 336

6 January 1989

Olu Stationery ltd

17, Kakawa Street

Lagos

Dear Sir,

We require 200 pieces of 0.8mm fountain pens and 1000 pieces of plain single line 21cm × 18cm exercise books.

Please give us quotes for the respective articles for immediate delivery and a statement of your terms of trade.

Yours Faithfully

Manager.

The above represents?

A. A quotation
B. Consignment notes
C. Letters of Inquiry
D. An order form

Use the following information to answer this question.

Oladosu Bookshop

54, Ahmadu Bello Way

Kaduna

P.O.BOOX 336

6 January 1989

Olu Stationery ltd

17, Kakawa Street

Lagos

Dear Sir,

We require 200 pieces of 0.8mm fountain pens and 1000 pieces of plain single line 21cm × 18cm exercise books.

Please give us quotes for the respective articles for immediate delivery and a statement of your terms of trade.

Yours Faithfully

Manager.

From the question above, the document the firm or organization will send to the buyer is

A. Delivery notes
B. Advice notes
C. An order form
D. Quotations

72. First Bank of Nigeria is an example of

A. Commercial bank
B. Central bank
B. Development bank
D. Merchant bank

Correct Answer: Option A

Explanation

Commercial banks are banks that accept deposit from the public e.g Ecobank, GTBank e.t.c

73. An abridged message sent at express speed to reach its destination faster than the airmail letters is known as

A. Telephone
B. Telegram
C. Telex
D. NITEL

Correct Answer: Option B

Explanation

Telegram can be sent and delivered at any time of the day. Charges are made according to the number of words contained therein.

74.Commerce brings about all except one

A. International co-operation
B. Improvement in the standard of living
C. Monotony of work
D. Infrastructural development

Correct Answer: Option C

Explanation

Commerce function as employment opportunities, International co-operation, Improvement in the standard of living and Infrastructural development.

75. Booklets containing a range of products, their uses and prices are called

A. Posters
B. Handbill
C. Catalogues
D. Price Journal

Correct Answer: Option C

Explanation

Catalogue is a type of advertisement ideal for manufacturers in other countries or towns. It enables consumers to know about such products and to order or request for them.

76. All harbours, docks and waterways of Nigeria are looked after by a public corporation called the

A. Nigerian Police Authority
B. Nigerian Ports Authority
C. National Ports Authority
D. National Police Authority

Correct Answer: Option B

Explanation

The NPA was established in 1955 to provides facilities for water traffic movement and controls pollution in rivers and ports.

77. Nigerian Police Authority

A. Nigerian Police Authority
B. Nigerian Ports Authority
C. National Ports Authority
D. National Police Authority

Correct Answer: Option B

Explanation

The NPA was established in 1955 to provides facilities for water traffic movement and controls pollution in rivers and ports.

78.One of these is not part of small-scale retailers

A. Urban stores
B. Roadside traders
C. Supermarkets
D. Itinerant traders

Correct Answer: Option C

Explanation

Supermarkets is an example of large scale retailers.

79. The Sole aim of government owned business is to

A. make profit
B. provide services to the public
C. spread environmental pollution
D. manage action

Correct Answer: Option B

Explanation

Government owned business are established to provide services to the members of the public but for an individual, the aim is to make profit.

80. Which function of money is described in the following statement?

It serves as a medium through which business transactions are carried out

A. Standard for deferred payments s
B. Medium of exchange
C. Store of value
D. Unit of account

Correct Answer: Option A

Explanation

Since money can be stored, it can accumulated to pay debts and can serve as a medium by which business transactions on credit can be settled.

81. Someone traveling abroad for at least "twenty - four hours" and a maximum stay of six months is known as

A. Transportation
B. Tourism
C. International trade
D. Domestic tourism

Correct Answer: Option B

Explanation

Tourism is the temporary, short-term movement of people to destinations outside the places where they live and work.

82 An International organisation that influence and fix the price of oil in the International markets is

A. IMF
B. ECOWAS
C. OPEC
D. OAU

Correct Answer: Option C

Explanation

Organisation of the petroleum exporting countries (OPEC) is a cartel organisation that ensure efficient and regular supply of petroleum & ensuring the stabilization of prices in International oil markets.