WAEC COMMERCE ANSWERS 2020

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(2a)
(i)improving the profitability of the firm.
(ii)Carrying out restriction of output ,
(iii)control of price,
(iv)allocation of market shares.

(2b)
-Advantages-
(i)They base their decisions on the full costs and benefits
involved.

(ii)They can be used to influence economic activity. To boost the country’s output, public corporations can be directly encouraged to increase their output.

(iii)In cases where it is practical to have only one firm in the industry, such as rail infrastructure, a public corporation would not abuse its market power.

-Disadvantages-
(i)They can be difficult to manage and control. The large size of theorganisations may mean that time has to be spent on meetings and communicating with staff, slowing down decision making.

(ii)They may become inefficient, produce low quality products and charge relatively high prices, due to a lack of competition and the knowledge that they cannot go bankrupt.

(iii)They will need to be subsidized if they are loss making. The use of tax revenue to support them has an opportunity cost it could be used to spend on, say, training more teachers and nurses.

(5a) Functions of Stock exchange
[PICK ANY FOUR]

*1. Continuous market for securities*
The Investors are able to invest in good securities and in case of any risk, it enables people to switch over from one security to another. So stock markets provides a ready and continuous opportunities for securities.

*2. Evaluation of securities*
It the stock exchange, the prices of securities clearly indicate the performance of the companies. It integrates the demand and supply of securities in an effective manner. It also clearly indicates the stability of companies. Thus, investors are in a better position to take stock of the position and invest according to their requirements.

*3. Mobilizes savings*
The savings of the public are mobilized through mutual funds, investments trusts and by various other securities. Even those who cannot afford to invest in huge amount of securities are provided opportunities by mutual funds and investment trusts.

*4. Healthy speculation*
The stock exchange encourages healthy speculation and provides opportunities to shrewd businessmen to speculate and reap rich profits from fluctuations in security prices. The price of security is based on supply and demand position. It creates a healthy trend in the market. Any artificial scarcity is prevented due to the rules and regulations of the market.

*5. Mobility of funds*
The stock exchange enables both the investors and the companies to sell or buy securities and thereby enable the availability of funds. By this, the money market also is strengthened as even short-term funds are available. The banks also provide funds for dealing in the stock exchanges.

Blessing Jerry:
6a)
1. Provides Technical Support To Exporters
2. Simplifies Export Procedures
3. Provides Grants And Incentives
4. Simplifies Export Procedures
5. Provides Exportable Products’ List

/: (1ai)

*Pick any 4*

(1) direct mail
(2) newspapers and magazines
(3) radio advertising
(4) television advertising
(5) film advertising
(6) outdoor advertising
(7) window display
(8) fairs and exhibition and
(9) specially advertising!

5b(i)

*A debenture* is a type of bond or other debt instrument that is unsecured by collateral. Since debentures have no collateral backing, debentures must rely on the creditworthiness and reputation of the issuer for support. Both corporations and governments frequently issue debentures to raise capital or funds.

(ii) *A bond* is a fixed income instrument that represents a loan made by an investor to a borrower (typically corporate or governmental). A bond could be thought of as an I.O.U. between the lender and borrower that includes the details of the loan and its payments. Bonds are used by companies, municipalities, states, and sovereign governments to finance projects and operations. Owners of bonds are debtholders, or creditors, of the issuer.