Past Questions

(a) Explain three means of payment in international trade and two means of payment in home trade. (b) Explain five reasons countries engage in international trade.

Explanation:
(a)(i) Means of Payment in International Trade: (i) Bills of exchange:- It is an instrument drawn through the banking system to pay an oversea seller for goods bought by an importer from another country. (ii) Travellers cheques:- These are special cheques issued by banks to its customers to enable them make payment while outside the country. (iii) Debit Cards:-These are issued by banks to their customers to enable them pay for goods and services online, provided they have money in their accounts. (iv) International bank draft: It is a cheque issued by a local bank, payable overseas on its own agent and handover to the buyer. (v) Credit transfer:-lt is an arrangement by which funds are transferred from one local person’s account to another in a foreign country by bank.
(ii) Means of payment in home trade: (i) Cash:- Local currency can be handed over to the seller as a means of payment. (ii) Point of Sales (POS):- Payment can be made through point of sale terminals using credit or debit cards. (iii) Bank app: Payment could be made directly by the buyer from their phones using bank applications (bank app). (iv) Local bank draft:- This is a cheque issued by a local bank payable within the country in the name of the seller.
(b) Reasons Countries Engage in International Trade: (i) Uneven distribution of natural resources- Some countries have abundance of certain natural resources for example oil while others do not. There is therefore need for trade to occur in order to obtain those resources. (ii) Differences in technology:- Differences in skills and technology necessitates trade as countries that do not have certain technology or skills in producing certain goods or services depend on others. (iii) Access to Wider marKet: The need to access a wider market for goods and services leads to international trade as surplus goods and services need to be exported. (iv) Need to access wide varieties of goods: Countries engage in international trade so as to obtain a variety of products so as to satisfy the different tastes of its consumers. (v) Seasonal products:- Some products are seasonal in nature and countries have to import them when they are no longer available.

a) List Four sources of credit available to a sole trader. (b) Explain the following credit instruments: (i) acceptance credit; (ii) luncheon voucher; (iii) bill of exchange. (c) State two advantages and three disadvantages of hire purchase to the seller.

Explanation:
(a) Sources of Credit Available to a Sole Trader: (i) Loans. (ii) Overdraft. (iii) Hire purchase. (iv) Trade credit (v) Leasing of equipment. (vi) Credit card. (vii) Revolving credit.
(b) Explanation of the Following Credit instruments: (1) Acceptance credit:-This is a method of borrowing where the company draws a cheque for banks to accept so that the company will discount the cheque on the money market. (ii) Luncheon Voucher:- These are vouchers purchased at a discount by companies to be given to staff to cover lunch allowance as motivation. (iii) Bill of exchange:- It is an unconditional order in writing addressed by one person to another, signed by the person giving it, requiring the person to pay a sum certain in money to the order of the specified person or bearer at a fixed or determinable future time.
(c) Advantages of hire purchase to the seller: (i) The seller retains ownership of goods until full payment is made. (ii) Profit will increase as a result of increase in sales (iii) It increases the rate of turnover. (iv) Goods could be reprocessed if payment fails. (v) There would be Increase in cash flow for the seller if the hire purchase is externally financed. Disadvantages of Hire Purchase to the Seller: (i) It may lead to litigation. (ii) It leads to tying down huge capital. (iii) The buyer may abscond with the goods. (iv) There could be high cost of recovering the debt. (v) If the customers fail to pay their debts, it turns out to be bad debt. (vi) Continuous disagreement during recovery of debts Could create a bad image for the company, (vii) Goods repossessed may be difficult to be resold.

The diagrams below are computer devices.

(a) Name any eight of the computer devices labelled A – I.
(b) State one use of any six input devices named in 4(a).
Explanation:

(a) Names of Computer Devices Labelled A-1: A – speaker. B – microphone. C – web camera/webcam. D – flash drive. E – monitor. F – printer. G – keyboard. H – optical pen. I – joystick.
(b) Uses of the Following Computer DeviceS: (i) Microphone:- It is a device used to capture voice into the system unit for voice recognition software, (ii) camera: It is a device that captures images for use in the syste. (iii) Flash drive:- It is an external storage device that could be used to copy files from one system for use in another system. (iv) Keyboard- It has a typewriter face with letters, numbers and symbols used to input characters and commands into the system unit. (v) Optical pen: It is a pen that has sensitive eyes that can read characters printed in special colours into the system unit (vi) Joystick: lt is a pad designed for playing computer games. Like the mouse, t allows the user to move the cursor from one end to another.

(a) Differentiate between a trade association and a chamber of commerce. (b) State four functions of a chamber of commerce (c) State four functions of an employers’ association.
Explanation:
a) Differences Between a Trade Association and a Chamber of Commerce: A trade association is an organization formed by people who engage in similar trade, vocation or profession to protect members’ interest while a chamber of commerce is an organization formed by businesses engaged in commerce, manufacturing and agriculture the same geographical area.
(b) Functions of a Chamber of Commerce: (i) lt serves as a guarantor/referee to members. (ii) It settles disputes among members. (iii) It provides advisory services to members. (iv) It educates informs members about latest developments in the trade, vocation or profession. (v) It organizes trade fairs and exhibitions and encourages members to attend. (vi) It regulates the entrý into a trade, profession or vocation (vii) It ensures that the quality of services rendered by members is of acceptable standards. (viii) It draws and imposes codes and ethics on members and sanctions defaulters.
(c) Functions of an Employers’ Association: (i) It takes active part in collective bargaining. (ii) It protects members from unfavorable government policies and legislation/services as pressure group (iii) It acts as a medium of communication between mmembers and government as well as groups. (iv) It cooperates with other organizations for the regulation of relations among employers. (v) lt provides advisory services to members. (vi) lt helps in harmonizing relations between employers and employees at the request of members. (vii) It obtains statistics and other data and provide such data to members when required.

ABC Limited, a textile company and XYZ Limited, a cotton processing company agreed to merge. (a) Identify and explain the type of merger to be formed by the companies. (b) State four reasons that would have necessitated the formation of the merger. (C) List and explain three sources of finance available to the company formed.

Explanation:
(a) The type of merger is vertical merger: lt is a merger where companies in the same line of business and at different levels of production come together to form a new company. This is when a company producing new raw materials merges with the one using the raw materials.
(b) Reasons that would have Necessitated the Formation of the Merger: (i) The merger could have resulted from the need for introduction of additional capital to avoid liquidation. (ii) There could be the desire by the firms to maintain stable prices. (iii) The decision to merge could have resulted from the need to achieve economies of scale. (iv) Reduction of overhead cost as a result of removal of duplicated staff could have necessitated the merger. (v) The desire to have regular supply of raw materials could have led to the merger. (vi) The merger could also arise due to the need to reduce the cost of production and increase profit. (vii) The firms could also merge because of the need to check competition and remove its undesirable consequences/achieve large share of the market.
(c) Sources of Finance Available to the Company: (i) Issue of shares:- This is where a newly formed company calls for subscriptions to shares. (ii) Issue of debenture: A debenture is a document conferring a long-term loan to a company. The holder becomes a creditor to the company and he is entitled to a fixed rate of interest whether or not the company makes profit. (iii) Bank loan: Banks advance loans to companies that satisfy the conditions for the loan. A loan is payable with interest at regular intervals (iv) Leasing:- An equipment or property could be rented for use by the new company for a specific number of years. (v) Hire purchase:- This facility is extended to companies to enable them own properties by making a down payment and the balance settled through installments. (vi) Overdraft:- The new company can arrange with the bank to withdraw more than what it has in the account.

COMMERCE WAEC 2022 PAST QUESTIONS THEORY In a carpentry workshop of three employees, one is responsible for cutting the wood, another for fixing and a third for polishing and spraying the furniture.
(a) Identify the term that describes the production process the workshop uses.
(b)(i) State five advantages of the production process identified in 1(a) to the workshop. (ii) State four disadvantages of the production process identified in 1(a) to the workshop.

Explanation:
(a)The term used to describe the production process is division of labour.
(b)(i) Advantages of division of labour: 1 The workers would be highly productive as a result of specialized tools, machinery and equipment being used/ Increase in production. (2) The period of training workers would be reduced thereby making staff replacement easy. (3) There will be efficiency in terms of time spent in production. (4) There would be greater efficiency as a result of individual and collective responsibility in the production process/ Better production technology. (5) There would be economy in the use of tools as workers do not have to move from one process to another. (6) There would be an increase in skills and mobility of labour within the workplace. ( 7) There would be reduction in cost of production leading to lowering of the selling price to attract more customers. (8) The process will lead to the development of sophisticated equipment and would reduce the stress of staff (9) Large scale production would result due to specialization/Economies of large scale.
(b)(ii) Disadvantages of division of labour: (1) Inefficiency of one worker would affect the production process. (2) The workers may not feel responsible for the result of the process in which they contribute. (3) Absence of one worker could delay the work being done which reduces Productivity. (4) Work becomes repetitive and Workers will lose interest in the work being done(monotony). (5) The start-up cost will be high as initial cost necessary to buy specialist machinery may lead to a higher break-even point. (6) There is the danger of one unit over producing than the other unit if not well monitored.

The agreement which led to the formation of the West African Clearing House was signed in
A. Gambia
B. Sierra Leone
C. Nigeria
D. Ghana
Correct Option: Answer is C
The Articles of Agreement for the establishment of the West African Clearing House were signed in Lagos, Nigeria, on March 14, 1975. The West African Clearing House was a multilateral payment facility that was established to promote trade within the West African sub-region. It was replaced by the West African Monetary Agency (WAMA) in 1996.

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One of the aims of ECOWAS is to
A. promote commereialization policies
B. promote commereializati10n policies
C. discourage foreign investors
D. ensure production of quality goods
Correct Option: Answer is B

Which of the following is not a function ol management?
A. Controlling
B. Delegating
C. Directing
D. Organizing
Correct Option: Answer is B

An organizational chart of a company shows the
A. arrangement of equipment in the company
B. financial status of employees in the company
C. geographical location of the company
D. hierarchy of staff in the company
Correct Option: Answer is D
An organizational chart is a diagram that visually conveys a company’s internal structure by detailing the roles, responsibilities, and relationships between individuals within an entity. It is one way to visualize a bureaucracy.