JAMB Commerce Past Questions & Answers - Page 117

581.

A person who buys new issues with a view of reselling at a higher price in the near future is referred to as a?

A.

bull

B.

bear

C.

dealer

D.

stag

Correct answer is A

A bull market is the condition of a financial market in which prices are rising or are expected to rise. A stock market player who buys securities in the hope that the prices will rise in the future is called a bull.

582.

A trader who gives credit stands to enjoy?

A.

higher profit

B.

cash discount

C.

increased sales

D.

trade discount

Correct answer is C

When a company sells on credit, it attracts new customers who would otherwise not buy from the company. This leads to increased sales volume

583.

An account maintained with a commercial bank for the purpose of foreign exchange transaction is the?

A.

foreign account

B.

international account

C.

domiciliary account

D.

foreign reserves account

Correct answer is C

A domiciliary account is a special kind of bank account that allows you to receive and make payments in foreign currencies.

584.

In order to prevent Liquidity in commercial banks, the central banks uses?

A.

moral suasion

B.

fiscal policy

C.

reserve ratio

D.

taxation

Correct answer is C

The reserve ratio is a compulsory portion of reservable liabilities that commercial banks must hold onto, rather than lend out or invest. Simply put, it is the minimum amount of money that banks are expected to keep in their accounts, with no option of lending it or investing it.

This is done to cater to unforeseen circumstances and to ensure that banks can always meet up with their daily monetary obligations to customers without running out of money.

585.

The components of capital employed in a business are?

A.

owners' equity and long-term debts

B.

total assets and current liabilities

C.

share capital and long-term debts

D.

share capital and current liabilities

Correct answer is B

Capital employed is derived by subtracting current liabilities from total assets