Explanations to the Answers
1. The essence of sales promotion is to induce customer to buy the product and offering the customer opportunity to nave a feel of what they want to buy Right choice – Option B

2. Consumers always follow the latest craze and as soon as a new style or trend is out the former fizzles out immediately while, the craze for the latter follows Right choice – Option C

3. Speculations makes the security to be more liquid which is what most investors are interested in Right choice – Option B

4. Marine voyage policy insurance policy covers or insures the journeying of the ship Right choice – Option D

5. The commercial banks accept deposits from the public for safekeeping and as such are liable if the deposits are not remitted or provided as at when needed Right choice – Option A

6. Middlemen are the link between the manufacturers and consumers. They are the wholesalers and retailers also
called the agents Right choice – Option A

7. Bank draft is a cheque drawn on a bank by itself or its agent. The debtor pays the bank for the draft at the time of issue Right choice – Option B

8. Horizontal integration means two firms producing same types of product come together to be a single firm Right choice – Option B

9.opening stock add purchase less closing stock results at
cost of goods sold N
Opening stock 40,000
Add purchases 115’000
Cost of goods available for sale
Less closing stock (60’000)
Cost of goods sold 95’000 Right choice – Option B

10.In a cooperative venture, members are entitled to one role’irrespective of the total shares held by members Right choice – Option C

11. Government bonds pays a particular fixed interest to investigate and investors gets the amount invested at the expiration of the time-lag of the bond Right choice – Option C

12. Capital market is a market where long-term securities are traded Right choice – Option A

13. An agent who factorize is a factor’ He is held liable for the good”s and has power to pledge the goods’ He purchase the trade debts of his client Right choice – Option D

14. It is a term used by sailors for men who load and unload ships Right choice – Option D

15. A close, indent specifies the manufacturer from whom the goods are to be Purchased Right choice – Option A

16. Mark-up is the relationship that exists between the profit and the cost of goods sold Right choice – Option B

17. The sole trader is very free to take quick decisions because he needs not consulting anybody compared to other business organization Right choice – Option C

18. Since the shareholders are the ones who resolve to liquidate voluntarily, they appoints the receiver Right choice – Option D

19. When a company is highly funded by debt (loan)’ it is said to be highly geared Right choice – Option C

20. Right issue is an issue of shares to existing shareholders to subscribe for shares on the same company Right choice – Option D

21. Ex-dividend literally means ‘without dividend” This implies that the shares are temporary suspended until it get to the date that it is entitled to recover dividend Right choice – Option A

22. Excise duties are tariffs levied on products exported to other countries Right choice – Option C

23. Re-insurance is insurance purchased by insurers from other insurers to limit the total loss an insurer would experience in case of a disaster Right choice – Option C

24. Customers drawback Right choice – Option A

25. Par value is an arbitrary amount that is determined when a company is incorporated Right choice – Option D

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