Commerce JAMB Questions and Answers 2027

Correct Answer: B. The distribution and exchange of goods and services

Explanation/Tip: Commerce encompasses trade (home and foreign) and aids to trade (banking, insurance, transportation, warehousing, advertising), bridging the gap between producers and consumers.

Correct Answer: C. Extractive industry

Explanation/Tip: Extractive industries (such as mining, agriculture, fishing, and forestry) obtain raw gifts of nature directly from land, water, or air.

Correct Answer: B. Wholesaler

Explanation/Tip: The wholesaler acts as a crucial link between the manufacturer and the retailer, breaking bulk and providing warehousing and risk-bearing services.

Correct Answer: B. Self-service shopping with a centralized payment checkout counter

Explanation/Tip: Supermarkets are large departmentalized retail stores operating primarily on self-service principles with a wide variety of food and household goods.

Correct Answer: B. Invoice

Explanation/Tip: An invoice is issued by the supplier to request payment, listing item descriptions, quantities, unit prices, discounts, and total cost.

Correct Answer: B. Indent

Explanation/Tip: An indent is an order for goods sent from abroad, classified into open indents (where the exporter chooses the supplier) and closed indents (where a specific brand is requested).

Correct Answer: B. Bill of lading

Explanation/Tip: The bill of lading is a contract of carriage between the shipper and carrier, serving as a receipt of goods and a document of title transferable by endorsement.

Correct Answer: B. Sole proprietorship

Explanation/Tip: A sole proprietorship (one-man business) is the simplest form of business organization, characterized by sole ownership, quick decision-making, and unlimited liability.

Correct Answer: B. Articles of Association

Explanation/Tip: Articles of Association outline internal rules concerning shareholder voting rights, director meetings, share transfers, and auditing procedures.

Correct Answer: B. Consumers cooperative society

Explanation/Tip: Consumers cooperatives pool members’ resources to purchase goods directly from manufacturers in bulk, passing cost savings to members through patronage dividends.

Correct Answer: C. Central bank

Explanation/Tip: The central bank oversees the financial system, issuing currency, regulating commercial banks, and providing emergency liquidity support as the lender of last resort.

Correct Answer: B. Depositing it into the payee’s bank account through clearing

Explanation/Tip: Crossing a cheque with two parallel transverse lines ensures it cannot be cashed directly across the counter, providing security against theft or fraud.

Correct Answer: B. Insurable interest

Explanation/Tip: Insurable interest requires that the policyholder stands to suffer a direct financial loss upon the occurrence of the insured risk, preventing insurance from becoming a gamble.

Correct Answer: B. The insured is restored to the exact financial position enjoyed before the loss occurred

Explanation/Tip: Indemnity applies to property and casualty insurance, ensuring compensation covers actual loss without allowing the insured to profit.

Correct Answer: B. Railway transport

Explanation/Tip: Railways are highly economical for bulk goods (coal, timber, agricultural produce) over long overland journeys compared to road transport.

Correct Answer: D. Reminder advertising

Explanation/Tip: Reminder advertising keeps mature products at the top of consumer minds, reinforcing brand awareness.

Correct Answer: B. Net sales (Total sales minus returns inward)

Explanation/Tip: Turnover represents the total value of goods sold by a business during an accounting period.

Correct Answer: B. Cost of goods sold from net sales (turnover)

Explanation/Tip: Gross Profit = Net Sales – Cost of Goods Sold (Opening Stock + Purchases + Carriage Inwards – Closing Stock).

Correct Answer: B. Current assets minus current liabilities

Explanation/Tip: Working capital represents liquid funds available for day-to-day operations and short-term financial commitments.

Correct Answer: B. Previously issued and new corporate stocks, shares, and government bonds

Explanation/Tip: The stock exchange is a secondary market providing liquidity where investors buy and sell existing securities through licensed stockbrokers.

Correct Answer: B. Foreign exchange market (Forex)

Explanation/Tip: The foreign exchange market determines exchange rates between national currencies to facilitate international trade and investment.

Correct Answer: B. Time utility

Explanation/Tip: Warehousing stores surplus goods until they are demanded in the market, creating time utility and price stability across seasons.

Correct Answer: B. Letter of credit

Explanation/Tip: A letter of credit provides security in international trade, assuring exporters that the issuing bank will honor payments upon fulfilling contract terms.

Correct Answer: B. Electronically over the internet and digital networks

Explanation/Tip: E-commerce involves buying and selling goods and services online via platforms like Jumia, Konga, or Amazon.

Correct Answer: B. Operate a business using the established brand name, trademarks, and operating system

Explanation/Tip: Franchising (e.g., McDonald’s, Domino’s Pizza) enables independent operators to run outlets under proven brand systems in exchange for royalties.

Correct Answer: B. Established by a special act of parliament or decree for public service

Explanation/Tip: Statutory corporations (public enterprises) are government-owned entities created to provide essential services rather than maximize profit.

Correct Answer: B. Prospectus

Explanation/Tip: A prospectus details company history, financial performance, directors, and future prospects to invite public investment in shares.

Correct Answer: B. Creditor entitled to fixed interest regardless of profit

Explanation/Tip: Debentures represent long-term loans made to a company. Holders are creditors, not owners, and receive fixed interest ahead of shareholder dividends.

Correct Answer: B. Money market

Explanation/Tip: The money market deals in short-term borrowing and lending through financial instruments like treasury bills, call money, and commercial paper.

Correct Answer: B. Road transport

Explanation/Tip: Road transport provides flexible, direct door-to-door collection and delivery of goods and passengers without requiring other transport connections.

Correct Answer: B. Regulate and control the manufacture, importation, and sale of food, drugs, and cosmetics

Explanation/Tip: The National Agency for Food and Drug Administration and Control (NAFDAC) safeguards public health by eradicating fake and substandard consumables.

Correct Answer: B. Enable the retailer to resell at a profit and cover operating expenses

Explanation/Tip: Trade discount is an allowance off the catalog list price given to trade buyers to ensure they have a viable profit margin when selling to consumers.

Correct Answer: B. Faster turnaround time and reduced handling costs

Explanation/Tip: Standardized metal containers protect goods from weather damage, minimize pilferage, and accelerate loading and unloading times across ships, trains, and trucks.

Correct Answer: B. Market segmentation

Explanation/Tip: Market segmentation allows businesses to tailor marketing strategies to specific demographic, geographic, or psychographic consumer segments.

Correct Answer: B. Certificate of origin

Explanation/Tip: Customs authorities require a certificate of origin to determine applicable tariff rates and trade agreement concessions.

Correct Answer: C. The final installment payment is completed

Explanation/Tip: In hire purchase, the buyer is a bailee until the final installment is paid, after which ownership title passes to them.

Correct Answer: C. Intangible fixed asset

Explanation/Tip: Goodwill represents non-physical business value, reputation, customer loyalty, and brand equity, classified as an intangible fixed asset.

Correct Answer: A. Operating production and distribution facilities in multiple countries

Explanation/Tip: MNCs have headquarters in one home country while managing operational branches, factories, and sales networks globally.

Correct Answer: B. Product, Price, Place, Promotion

Explanation/Tip: The marketing mix comprises the core controllable variables (Product, Price, Place, Promotion) that a company blends to satisfy target markets.

Correct Answer: B. Consols (Consolidated Stock)

Explanation/Tip: Consols represent perpetual government bonds that pay continuous interest without a fixed redemption date for the principal capital.