Neco commerce answers 2020

Here is the commerce answers for neco 2020. Please confirm your questions before answering. Share to your friends and classmates. Good luck

 

Theory:

1)
(Choose Any Five)
(i)Banker to the government
(ii) Insurance and control of currency
(iii) Lender of last resort
(iv) Foreign exchange transaction
(v) Responsible for monetary policy
(vi) Banker’s bank

EXPLANATION:

(i) Banker to the government: Central Bank is an agent and banker to the government. It control public account, receives revenue on behalf of the government and make payment from this account. Central Bank also obtains loan on behalf of the government.

(ii) Insurance and control of currency: The central bank has the right to order the printing of the currency and the issuance of it. It control the circulation of currency, exchange of bad notes for new ones and see to the destruction of the bad notes.

(iii) Lender of last resort: The central bank has a duty to assist the banking system when the banks are in financial difficulties so that they can withstand the strain of excessive demands. In some countries, the banks can borrow directly from the central bank.

(iv) Foreign exchange transaction: The central bank holds the foreign reserve of a country, and this helps in enforcing foreign exchange control regulation. It operates the exchange control which is set up to purchase and sell foreign currencies.

(v) Responsible for monetary policy: The central bank is responsible for the monetary policies of the country. It can use both the expansionist and restrictionist policies to control the quantity and value of money in circulation so as to influence the level of production and distribution of the national income.

(vi) Banker’s bank: Th central bank acts as banker to the banks by ensuring that the banks open account with it in order to facilitate clearing of cheques. This helps the commercial banks to have similar facilities to offer to their customers.

2a)
Multilateral trade agreements are commerce treaties among three or more nations. The agreements reduce tariffs and make it easier for businesses to import and export. Since they are among many countries, they are difficult to negotiate.

2b)
(i) Differences in Demand:
advantageous trade can occur between countries if demands or preferences differ between countries. Individuals in different countries may have different preferences or demands for various products. For example, the Chinese are likely to demand more rice than Americans, even if consumers face the same price. Canadians may demand more beer, the Dutch more wooden shoes, and the Japanese more fish than Americans would, even if they all faced the same prices

(ii) Differences in Technology
Advantageous trade can occur between countries if the countries differ in their technological abilities to produce goods and services. Technology refers to the techniques used to turn resources (labor, capital, land) into outputs (goods and services).

(iii) Differences in Resource Endowments
Advantageous trade can occur between countries if the countries differ in their endowments of resources. Resource endowments refer to the skills and abilities of a country’s workforce, the natural resources available within its borders (minerals, farmland, etc.), and the sophistication of its capital stock (machinery, infrastructure, communications systems).

(iv) Existence of Government Policies
Government tax and subsidy programs alter the prices charged for goods and services. These changes can be sufficient to generate advantages in production of certain products. In these circumstances, advantageous trade may arise solely due to differences in government policies across countries.

 

3a)
An entrepreneur: is an individual who creates a new business, bearing most of the risks and enjoying most of the rewards. … Entrepreneurs play a key role in any economy, using the skills and initiative necessary to anticipate needs and bring good new ideas to market.

(3b)
Production: is a process of combining various material inputs and immaterial inputs (plans, know-how) in order to make something for consumption (output). It is the act of creating an output, a good or service which has value and contributes to the utility of individuals. … market production.

(3c)
Fixed capital: is the portion of total capital outlay of a business invested in physical assets such as factories, vehicles, and machinery that stay in the business almost permanently, or, more technically, for more than one accounting period.

(3d)
An exchange: is a marketplace where securities, commodities, derivatives and other financial instruments are traded. The core function of an exchange is to ensure fair and orderly trading and the efficient dissemination of price information for any securities trading on that exchange.

(3e) Specialization is a method of production whereby an entity focuses on the production of a limited scope of goods to gain a greater degree of efficiency. … This specialization is thus the basis of global trade, as few countries have enough production capacity to be completely self-sustaining

4a) Packaging: is the science, art and technology of enclosing or protecting products for distribution, storage, sale, and use.

4b)
[Tabulate]
SUPERMARKET
(i) Supermarkets are considered to be larger shopping outlets that sell a variety of goods to their customers under one roof

(ii) Supermarkets offer their products at significantly higher prices as compared to the shops and other retail outlets in the surrounding. They tend to charge the executive shopping experience their offer to their customers

(iii) a supermarket are very attractive with distinctive colours and graphics

(iv)Supermarkets are known to stock large numbers of similar products to cover the large number of customers buying the same product

HYPER MARKET
(i) hypermarkets are larger than a typical supermarket. Despite having shelves that contain different varieties of a specific product, hypermarkets have departmental stores that store various products

(ii) Products retail at moderately lower prices in a hypermarket which encourages many people to purchase goods in this stores

(iii) a hypermarket is moderately attractive. They do not have an attractive appearance, and they resemble more of a warehouse rather than a shopping facility

(iv) On the other hand, hypermarkets do not offer a personal touch and the warm services of a supermarket which makes them not to attract a large number of customers

4c)
(i) Improved Customer Experiences.
(ii) Increased Efficiency for Customer Service Departments.
(iii) Self Service Creates Consistency.
(iv) Increased Revenues.
(v) More Insight on What Consumers Want.
(vi) Increased Efficiency Among Agents.

(1)
(i)printing of Nigeria’s currency.
(ii)Supports government in budget preparation
(iii)sets interest rates
(iv)Regulates Naira’s value
(v)They make rules that guide commercial banks in the country

(1i)
printing of Nigeria’s currency; They ensure money is being printed and distributed and not only to print but to also ensure that the money is evenly distributed throughout the country. In other words They ensure that the country must at least have printed currency at any time. Once this key responsibility is met, it gives room for the Centre bank to perform other functions.

(1ii)
Supports government in budget preparation; Once the government makes budget for a year they look up to the central bank for help and for advice on what may be the outcome of its budget. That is the main reason why the Central bank governor must be brilliant enough to read what might be the outcome of government budgeting system at the end of each year. The central bank governor must be able to know the effect a budget can have on the country’s economy. It is also the role of the central bank to give out cash to the government so as to embark on the approved budget.

(1iii)
sets interest rates; As a financial institution, it is also their primary duty to set certain amount as interest on any citizen account. With this, commercial banks in the country must follow the instructions or directive given by the central bank of Nigeria before adding any interest to the amount of money borrowed by an indigene of the country.

(1iv)
Regulates Naira’s value; the Central Bank is to ensure that there’s a normal value of the country’s currency when compared to foreign currencies. This can be achieved by making sure that the policies, environment and business or monetary atmosphere are favorable.

(1v)
They make rules that guide commercial banks in the country; the central bank ensure that there is normality when it comes to banking system in Nigeria. The Central bank makes sure that citizens have total trust in the country’s banking system by creating rules and regulations to guide the activities of all commercial banks in the country.

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