WAEC Commerce 1992 past questions

Checked by the Skolra question team · Last updated 23 October 2026

Ten questions from the 1992 WAEC Commerce paper, with answers and explanations. We hold 69 questions from this paper, and the Skolra app has all of them.

WAEC Commerce 1992 questions and answers

1.Which of the following saves consumers the time and cost involved in travelling to commercial centres for shopping?
1. A
  Door-to-door selling
2. B
  Mail order business
  Correct
3. C
  Departmental store
4. D
  Hire purchase
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Answer: B
Mail order business is the correct answer. Under mail order, a consumer selects goods from a catalogue or price list and orders them by post (or, today, by phone/online), paying by post and having the goods delivered straight to the home. Because the customer never has to leave home to visit a shop, it saves the time and cost that would otherwise be spent travelling to commercial centres for shopping — this is the classic advantage WAEC Commerce associates with mail order trading.
2.One of the objectives of the indigenization programmes of the Federal Government of Nigeria is to?
1. A
  transfer the ownership and control of business enterprises from foreigners to Nigerians
  Correct
2. B
  increase the number of foreign-owned companies operating in Nigeria
3. C
  raise revenue for government through the sale of shares in public enterprises
4. D
  reduce the number of Nigerians employed in the private sector
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Answer: A
The Indigenization Decree (Nigerian Enterprises Promotion Decree, 1972 and its 1977 revision) was introduced by the Federal Government to reduce foreign domination of the Nigerian economy. Its core objective was to transfer the ownership and control of business enterprises from foreigners to Nigerians, by reserving certain businesses exclusively for Nigerian citizens and requiring Nigerian equity participation in others.
3.The most important function of the retailer is to?
1. A
  To buy goods in large quantities and break them into smaller units for sale to final consumers
  Correct
2. B
  To transport finished goods directly from the factory to the wholesaler
3. C
  To grant trade credit facilities to wholesalers so they can restock
4. D
  To advertise the manufacturer's products in order to create consumer awareness
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Answer: A
The retailer stands at the very end of the chain of distribution, right next to the final consumer. The retailer's most important function is to buy goods in bulk from the wholesaler (or producer) and break that bulk down into small units — single tins, single tubers, small packets — that an ordinary household can afford and actually use. This is called "breaking bulk", and it is what makes goods available to consumers in the quantities they need, when and where they need them.
4.The three main division of production are?
1. A
  Agriculture, manufacturing and trade
2. B
  Land, labour and capital
3. C
  Production, exchange and consumption
4. D
  Primary, secondary and tertiary production
  Correct
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Answer: D
In Commerce, production (the creation of goods and services to satisfy human wants) is grouped into three main divisions, based on the stage at which value is added:
Primary production — the extraction or gathering of raw materials directly from nature, e.g. farming, fishing, mining and forestry.
Secondary production — the processing or manufacturing of those raw materials into finished or semi-finished goods, e.g. factories turning cocoa into chocolate, or crude oil into fuel.
Tertiary production — the provision of services that support and complete the production process, e.g. transport, banking, insurance, warehousing and distributive trade (commerce).
5.Which of the following is common to both large and small firms?
1. A
  The profit motive
  Correct
2. B
  Economies of scale in production
3. C
  Limited liability of owners
4. D
  Division of labour among many departments
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Answer: A
The profit motive is common to both large and small firms. Whether a business is a one-man roadside shop or a large public company, the owner(s) set it up mainly to earn a profit from selling goods or services. Size does not change this basic aim of trade.
Since profit motive is the one feature every firm, large or small, shares, it is the correct answer.
6.Which of the following is not a member country of the Lake Chad Basin Commission?
1. A
  Cameroon
2. B
  Ghana
  Correct
3. C
  Chad
4. D
  Niger
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Answer: B
The Lake Chad Basin Commission (LCBC) was set up in 1964 by the countries that share the Lake Chad basin, so that they could manage the lake's water and other resources together instead of each country acting alone.
7.Which of the following is not a basic utility created by marketing?
1. A
  Form utility
  Correct
2. B
  Time utility
3. C
  Possession utility
4. D
  Place utility
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Answer: A
Form utility is not created by marketing — it is created by production.
Marketing (the distribution side of business) adds value to goods in three ways that economists call utilities:
Place utility — moving goods from where they are produced to where customers want them (e.g. transporting cocoa from the farm to a factory or market).
Time utility — making goods available when they are needed, through warehousing and storage (e.g. keeping harvested grains until the off-season when demand is high).
Possession (ownership) utility — transferring ownership of goods from the seller to the buyer through the sale transaction, giving the buyer the right to use the goods.
8.An order stating the goods required but not the manufacturer from whom the foreign buyer intends to buy his goods is called?
1. A
  Closed indent
2. B
  Pro forma invoice
3. C
  Open indent
  Correct
4. D
  Letter of credit
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Answer: C
In foreign trade, a buyer who cannot deal with an overseas seller directly uses an indent house (an agent) to place the order. The order the buyer gives is called an indent, and it comes in two forms depending on how much detail the buyer specifies.
9.A deduction made by a wholesaler from the catalogue price and which represents a retailer's profit margin is called?
1. A
  Commission
2. B
  Trade discount
  Correct
3. C
  Cash discount
4. D
  Quantity discount
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Answer: B
Trade discount is correct. It is the deduction a wholesaler or manufacturer allows off the catalogue (list) price when selling to a retailer. The retailer then sells to the final consumer at the full catalogue price, and the gap between what the retailer paid (after the discount) and the catalogue price is the retailer's profit margin.
10.Nearness to a city centre and a busy street is a necessary condition for sitting?
1. A
  a factory
2. B
  a retail shop
  Correct
3. C
  a cottage industry
4. D
  a warehouse
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Answer: B
A retail shop is the correct answer. Retail trade survives on customer footfall — the shop makes its money by catching people who are already out shopping or passing by, so it must sit where people naturally gather and move: the city centre and a busy street. The nearer the shop is to this traffic, the more casual buyers it catches, which is why rents on such streets are highest for retailers.

The questions come from past JAMB, WAEC and NECO papers. We use software to help write the answer options and explanations, and every answer is checked twice before it goes on the site. How we check

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WAEC Commerce 1992 past questions

WAEC Commerce 1992 questions and answers

Practise all 69 questions we hold from the 1992 paper, on a timed CBT screen

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