JAMB UTME - Commerce - 1997

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The management function of evaluating whether objectives are being achieved is controlling. Controlling is a management function that involves monitoring and measuring the performance of the organization, comparing it with the planned objectives, and taking corrective action if necessary to ensure that the goals are achieved. The controlling function helps to identify any deviations from the plan, analyze the reasons for the deviation, and take corrective measures to bring the performance back on track. It is an essential function of management that helps to ensure that the organization is moving in the right direction and achieving its objectives. By monitoring and controlling performance, managers can take proactive steps to address issues and make necessary changes to ensure success.

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A close indent is an instrument given to an agent to order goods from a particular manufacturer. A close indent is a document that specifies the goods that an agent is authorized to purchase from a specific manufacturer. The indent provides details such as the quantity, quality, price, and delivery terms of the goods. This document is used by the agent to order the goods on behalf of the buyer. The use of a close indent ensures that the agent purchases the goods from the specified manufacturer and helps to prevent the agent from purchasing inferior goods or goods at a higher price from another manufacturer. This helps to ensure quality control and consistency in the goods purchased by the buyer.

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In foreign trade, a document of title is known as a bill of lading. A bill of lading is a legal document issued by a carrier (such as a shipping company or trucking company) that acknowledges receipt of goods and specifies the terms of their transport. The bill of lading serves as a receipt for the goods, a contract of carriage between the carrier and the shipper, and a document of title to the goods. The document of title aspect of the bill of lading is particularly important in international trade. The bill of lading is a negotiable document, which means that ownership of the goods can be transferred by endorsement and delivery of the bill of lading. The holder of the bill of lading has the right to take possession of the goods at their destination and can use the bill of lading to claim ownership of the goods in disputes or legal proceedings. In summary, a bill of lading is a document of title that serves as a receipt for goods, a contract of carriage, and a transferable ownership document in international trade.

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The most important piece of legislation governing business and commercial activities in Nigeria currently is the Companies and Allied Matters Act (CAMA) of 1990. The CAMA is a comprehensive legislation that regulates the formation, management, and winding up of companies in Nigeria. The Companies and Allied Matters Act provides the legal framework for the establishment and operation of various types of companies in Nigeria, including private limited companies, public limited companies, and companies limited by guarantee. The act also contains provisions that cover issues such as share capital, directors' duties, shareholders' rights, and corporate governance. In addition to the Companies and Allied Matters Act, there are other important pieces of legislation that govern business and commercial activities in Nigeria, such as the Trade Disputes Act of 1976 and the Banks and Other Financial Institutions Act of 1991. However, the CAMA is considered to be the most important legislation as it provides the basic legal framework for the formation and operation of companies in Nigeria.

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Sudden technology changes can have the effect of making a company's product obsolete. Technological advancements can lead to the development of new and improved products, rendering older products obsolete or less desirable to consumers. Companies that do not keep up with technological changes may find themselves with outdated products that are no longer competitive in the market. For example, the introduction of digital cameras made traditional film cameras obsolete, leading many film camera manufacturers to either adapt or go out of business. Similarly, the rise of smartphones with built-in cameras has made standalone digital cameras less popular. Therefore, sudden technology changes can have a significant impact on a company's product offerings, making them less desirable or even obsolete. Companies that do not adapt to these changes may find themselves struggling to compete in the market.

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In insurance business, the person who takes the financial risk by agreeing to compensate the insured person or entity for any loss or damage covered by the insurance policy is known as an underwriter. The underwriter evaluates the risks involved and decides whether to issue the insurance policy and at what premium. They assume the financial risk in exchange for the premium paid by the insured. An underwriter can be an individual or a company.

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The cost of transporting goods to consumers is called "carriage outward". "Carriage outward" refers to the cost of transporting goods from the seller or manufacturer to the buyer or consumer. This cost is usually borne by the seller, as it is their responsibility to ensure that the goods are delivered to the buyer in a timely and cost-effective manner. The cost of carriage outward may include various expenses such as shipping fees, freight charges, insurance, and handling charges. These costs are typically included in the price of the goods and are passed on to the buyer as part of the overall cost of the transaction. Overall, the cost of carriage outward is an important consideration for both sellers and buyers, as it can have a significant impact on the final price of the goods and the overall profitability of the transaction.

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Leasing refers to the contractual agreement between a lessor (owner of an asset) and a lessee (user of an asset) whereby the lessor grants the lessee the right to use an asset for a specified period in exchange for a periodic payment known as rent. The lessee does not own the asset but has the right to use it during the lease period. The payment made by the lessee to the lessor is commonly referred to as rent, and the asset being leased could be anything from equipment, vehicles, real estate, or other physical assets. This arrangement allows businesses to acquire the use of assets without the upfront costs associated with purchasing the asset outright.

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The form of business financing which involves pledging of a specific asset is a mortgage. A mortgage is a type of loan that is secured by a specific asset, usually a property, which serves as collateral for the loan. If the borrower fails to repay the loan, the lender can seize the property and sell it to recover their money. Mortgages are commonly used to finance the purchase of real estate property, but they can also be used for other assets, such as equipment or vehicles. Debentures and bonds are types of long-term loans that are not secured by any specific asset, while loans can be secured or unsecured, meaning they may or may not involve a pledge of specific assets.

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Commercial banks are often referred to as departmental stores of banking because they offer a wide range of services to their customers. They provide services such as savings and current accounts, loans, overdraft facilities, credit cards, and foreign exchange services, among others. Just like a departmental store that offers a variety of goods under one roof, commercial banks offer various financial services to their customers in one place. This makes it convenient for customers to access different financial services they need from a single institution.

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The total amount that a company is allowed to raise according to its memorandum of association is known as authorized capital. The memorandum of association is a legal document that sets out the company's constitution and rules, including the amount of authorized capital that the company is permitted to raise. Authorized capital is also known as "nominal capital" or "registered capital". This represents the maximum amount of money that a company can legally raise by issuing shares to its shareholders. The company is not required to issue all of its authorized capital, but it cannot issue more shares than the authorized capital amount without first amending its memorandum of association. The authorized capital is different from issued capital, which is the amount of capital that has actually been issued to shareholders, and paid-up capital, which is the portion of issued capital that has been paid for by shareholders. Called-up capital is the amount of capital that the company has requested from shareholders to pay for their shares. In summary, authorized capital is the maximum amount of capital that a company is legally allowed to raise according to its memorandum of association.

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The term which indicates that a share is temporarily suspended is "ex-dividend." When a company declares a dividend to be paid to its shareholders, the company sets a date called the record date, which determines the shareholders who will receive the dividend. The ex-dividend date is typically set two business days before the record date. If an investor purchases a share before the ex-dividend date, they are entitled to receive the upcoming dividend. However, if they purchase the share on or after the ex-dividend date, they will not receive the dividend. The share is said to be "ex-dividend" during this period, which means that the buyer of the share will not receive the upcoming dividend.

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Excise duties are paid on goods that are manufactured within the country. Excise duty is a tax that is levied on specific goods that are produced within a country, such as alcohol, tobacco, petroleum, and certain luxury items. The tax is paid by the manufacturer of the goods and is included in the price of the product. The purpose of excise duty is to raise revenue for the government and to discourage the consumption of certain goods that are deemed to be harmful or non-essential. The tax is typically based on the quantity or value of the goods produced. Goods that are imported into the country may also be subject to customs duties or tariffs, which are different from excise duties. Exported goods, on the other hand, are typically exempt from excise duties as they are not being consumed within the country. Goods kept in bond warehouses are also exempt from excise duties until they are released into the market.

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The main purpose of insurance is to spread the risk of financial loss from an individual or organization to a larger group of people or entities. Insurance is a contract between an insurance company and an individual or organization, where the individual or organization agrees to pay a premium in exchange for protection against potential financial losses. Insurance helps to protect individuals and organizations from unexpected events that could result in financial losses. For example, if a person has car insurance and gets into an accident, the insurance company will help cover the cost of repairs or replacement of the car, reducing the financial burden on the individual. Similarly, if a business has insurance and experiences a fire, the insurance company will help cover the cost of repairs and replace any damaged or destroyed property, reducing the financial impact on the business. By spreading the risk of financial loss over a larger group, insurance companies are able to provide financial protection to individuals and organizations at a lower cost than if they had to bear the full cost of any losses themselves. This helps to promote economic stability and allows individuals and organizations to take risks and pursue opportunities with the knowledge that they are protected against financial losses. Therefore, the main purpose of insurance is to spread individual losses over all covered participants and provide financial protection against unexpected events.

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One of the criteria for differentiating consumer markets from industrial ones is the type of demand. Consumer markets refer to markets where goods and services are sold directly to individuals for their own personal consumption. In these markets, demand is driven by individual needs and preferences, and purchase decisions are often made based on factors such as price, quality, and convenience. Industrial markets, on the other hand, refer to markets where goods and services are sold to businesses for use in their operations or for resale to other businesses or consumers. In these markets, demand is driven by the needs of the businesses and their customers, and purchase decisions are often made based on factors such as reliability, efficiency, and compatibility with existing systems. While the type of demand is an important criterion for differentiating consumer markets from industrial ones, it is not the only factor. Other factors such as the nature of the services rendered and the price of the goods can also play a role in this differentiation.

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Stevedores in foreign trade refers to men who load and unload ships. They are responsible for the handling of cargo, including the safe and efficient loading and unloading of goods onto and off of ships in ports. They work with cranes, forklifts, and other heavy equipment to move cargo onto and off of ships, ensuring that it is properly secured and protected during transport.

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The existing system of government and administrative sub-division of a country which affect the operation of business in the country is described as the political environment. The political environment refers to the laws, regulations, policies, and practices of government that affect business operations. This includes the form of government, such as democracy or dictatorship, the level of government involvement in the economy, the stability of the government, and the relationship between government and business. For example, a country with a stable government and favorable policies towards business may attract more investment and be more conducive to business operations. On the other hand, a country with an unstable government or unfavorable policies may discourage investment and hinder business operations.

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Partnerships are most suitable where professionals are involved. A partnership is a business structure in which two or more people own and operate a business together. Each partner contributes their skills, expertise, and capital to the business in exchange for a share of the profits and losses. Partnerships are most effective when each partner brings a unique skillset to the table and can work together to achieve common goals. This is particularly important when professionals are involved, as they can combine their expertise to offer a wider range of services to clients. While having family friends as partners or easily raising enough capital can be beneficial, these factors are not the most critical to the success of a partnership. It is important to note that government regulations can also play a role in the suitability of a partnership, but they are not the sole determining factor.

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The market where new shares are traded for the first time is known as the primary market. In this market, companies issue new securities, such as stocks and bonds, to raise capital from investors. The primary market is also known as the new issue market because it is the first time that securities are being offered to the public for purchase. Once the securities are sold in the primary market, they can then be traded in the secondary market, such as a stock exchange.

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The type of investment that has a variable income is ordinary shares, also known as common stocks. Ordinary shares represent ownership in a company, and their value is directly tied to the performance of the company. The income generated from ordinary shares comes in the form of dividends, which are payments made by the company to its shareholders. The amount of dividends paid to shareholders can vary from year to year, depending on the financial performance of the company. If the company is profitable, it may choose to pay higher dividends to shareholders. Conversely, if the company is not doing well, it may choose to reduce or eliminate dividend payments. Unlike other types of investments, such as government bonds and preferred shares, which typically offer a fixed rate of return, the income generated from ordinary shares is not guaranteed and can vary significantly from year to year. Therefore, if an investor is looking for an investment with the potential for higher returns but is willing to accept the risk of variable income, ordinary shares may be a suitable option.

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Social responsibility of business refers to the concept that businesses have an obligation to act in ways that benefit society as a whole, beyond just their own profit-making objectives. It requires enterprises to address themselves to issues relating to the society, such as environmental sustainability, community development, and ethical business practices. This means that businesses should not only focus on making profits, but also take into account the impact of their activities on the community and the environment, and strive to contribute positively to the well-being of the society.

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Delegation refers to the process of assigning tasks and responsibilities to other individuals in an organization. A key advantage of delegation is that it allows the manager to prepare workers for higher responsibilities. By assigning tasks to employees, the manager can help them develop their skills and gain experience, which can ultimately prepare them for more challenging roles in the future. Additionally, delegation can free up the manager's time to focus on more strategic tasks, such as planning and decision-making, which can help to improve overall organizational performance. However, it's important for managers to delegate effectively by providing clear instructions, monitoring progress, and offering support when needed.

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The element of marketing mix involved when a vendor supplies newspapers from house to house and across the streets is "place". Place refers to the various channels, locations, and methods used by a company to make its products or services available to customers. In this case, the vendor is using a specific place or distribution channel, which involves physically delivering the product directly to the customer's location. This is an important aspect of the marketing mix as it ensures that the product is available where and when the customers need it, which can help to increase sales and customer satisfaction.

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The major objective of corporate mergers is to enhance economies of scale. Corporate mergers involve the combining of two or more companies to create a larger and more efficient company. This larger company can take advantage of economies of scale, which are the cost savings that come from increased production and efficiency. By combining their resources, the merged company can reduce costs by eliminating duplicate operations, reducing overhead, and achieving greater bargaining power with suppliers. This increased efficiency can lead to higher profits and better competitiveness in the marketplace. The objective of enhancing economies of scale through corporate mergers is also closely tied to profit maximization. By reducing costs and increasing efficiency, the merged company can increase its profits and improve its financial position. Therefore, the major objective of corporate mergers is to enhance economies of scale, which can lead to cost savings, increased efficiency, and ultimately, higher profits.

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Indirect services are those that are not provided directly to the customers but are necessary to facilitate the delivery of other services. An example of indirect service is rendered by civil servants, who provide administrative support to government agencies that offer services to the public. Civil servants perform a range of functions that enable the smooth running of government agencies and departments, including record-keeping, policy development, and program implementation. Without their services, it would be difficult for government agencies to provide essential services to the public.

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The business organization in which shareholders have equal vote is a co-operative. In a co-operative, each shareholder/member has one vote regardless of the number of shares owned. This ensures that all members have equal say in the decision-making process of the organization, and no member can dominate the others. Co-operatives are typically formed by individuals or businesses with similar needs or interests who come together to collectively meet those needs, share resources, and distribute any profits or benefits among the members.

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A court order is not necessary for the winding up of a company when a special resolution of members is passed to that effect. This means that the members of the company have agreed to wind up the company voluntarily and no legal intervention is required. In the other options mentioned, a court order may be necessary for the winding up of a company. For instance, if a company suspends business for one year, a court order may be required to wind up the company. Similarly, if the company is unable to pay its debts or if the number of members falls below the legal minimum, a court order may be necessary to wind up the company. Overall, a court order is not necessary for the winding up of a company when the members pass a special resolution to that effect.

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When it becomes necessary to liquidate a company, the first step to be taken is the appointment of a liquidator. A liquidator is an individual or a firm appointed to oversee the winding up of a company and the sale of its assets to pay off its debts. The liquidator is responsible for ensuring that the assets are sold at the best possible price and that the proceeds are distributed fairly among the creditors. The appointment of a liquidator typically follows a decision to wind up the company, either voluntarily by the shareholders or involuntarily by a court order. The liquidator takes over the management of the company and works to settle its debts, including paying off creditors and distributing any remaining assets to the shareholders. Overall, the appointment of a liquidator is a critical step in the process of winding up a company, and it is essential to ensuring that the process is carried out in a fair and orderly manner.

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In a business organization, the annual operation plan or budget is a form of short-term plan. A short-term plan covers a period of up to one year, and it is a detailed and specific plan that outlines the objectives and activities that need to be accomplished during that time. The annual operation plan or budget typically covers a period of one year and is usually prepared on a yearly basis. The annual operation plan or budget sets out the expected income and expenses for the organization over the next year. It is based on the organization's goals and objectives, as well as its historical financial data and market trends. The budget includes a breakdown of the expected income and expenses, as well as details on how the funds will be allocated and used. The purpose of the annual operation plan or budget is to provide a roadmap for the organization to follow during the upcoming year. It helps to ensure that the organization stays on track and is able to meet its financial goals and objectives. It is also used to monitor the organization's progress throughout the year and make any necessary adjustments to the plan as circumstances change. In summary, the annual operation plan or budget is a short-term plan that covers a period of up to one year. It outlines the expected income and expenses for the organization and provides a roadmap for achieving its financial goals and objectives.

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Demurrage charges refer to the cost incurred when the charterer of a ship fails to load or unload the ship within the agreed-upon time at the port. The charges are intended to compensate the ship owner for the additional costs they incur due to the delay, such as fuel and crew wages. Demurrage charges are usually calculated based on a daily rate and can be a significant cost for businesses involved in shipping.