MKT 301 2018 JULY PAST QUESTIONS
1a. Carefully explain what you understand by capitalism and consumer cooperative society
1b. State 5 similarities between capitalism & cooperative societies
1c. Outline the problems of consumer cooperatives in Nigeria
1d. List 5 types of cooperatives in Nigeria
1e. Describe in details the difference between the top downward and bottom upward structure
2a. Explain what you understand by perfect competition
2b. List 5 characteristics associated with perfect competition
3a. Carefully explain the factors that have militated against the growth of consumer cooperatives societies in Nigeria
3b. What are the functions of consumer cooperatives in Nigeria
4a. Identitfy and explain the skills and competencies required of a cooperative manager
4b. Outline & discuss sources of financing available to cooperative
5a. Write short notes on the following
i. Salesmanship
ii. Pricing
iii. Financing
iv. Selling/Selling Process
5b. Identify and briefly explain 4 rypes of onsumer cooperatives meetings

MKT 301 2018 JULY PAST QUESTIONS
MKT 301 JULY 2018 ANSWERS
1a. Capitalism is an economic system that relies on the private sector to run & own the economy, with minimal interference from government... while Consumer cooperative is a retail business which is owned by the consumers themselves; the basic objective is to eliminate middlemen
1b. - Like capitalism cooperative also accept the right of private property, the right of contract, inheritance and right to private enterprise
- Cooperatives also use capital to carry on its activities and pay
interest for its use
- Like capitalist enterprise, cooperatives employ experts and pay them remuneration based on the quality of service rendered
- Cooperatives also depend on business efficiency for their
successes same as enterprises
- Both systems frown at any intervention from the government
1c. - The societies were unable to withstand the stiff competition from well-established entrepreneurs especially the Importers who bring in these consumer goods usually want to exchange them for cash crops which they happily shipped overseas to their parent companies
- Due to the nature and circumstances of surrounding the establishment of such organisation, it was not long before the problems of management manifested. This problem it was assumed was due to the hurried manner the cooperatives were
started
- It was reported that most members were ignorant of the basic cooperative principles and proper structure and administration of their societies
- They sold goods in their shops at the lowest possible prices not minding what is competitors prices are in the local market
- Their rivals allowed market forces to determine the prices of their goods, but this was not applicable in running of the cooperative shops
- The cooperatives inability to obtain goods at wholesale prices which compelled them to buying from middlemen at retail/semi retail rate and reselling to members often at a loss or the barest minimum profit
1d. - Worker Cooperatives
- Agricultural Cooperatives
- Housing Cooperatives
- Community Coooeratives
- Transport Cooperatives
1e. The top-down structure relies on higher authority figures to be ones to take decisions; the fate and choice of the lower class will not be considered. In comparison, the bottom-up structure features a decision-making process that gives higher authority figures and the lower class a say
2a. Perfect competition is a market situation in which a large number of producers offer a homogeneous product to a very large number of buyers of the product. The number of sellers could be so large that each seller offers a very small fraction of the total supply and therefore has no control over the market price. Similarly, the number of buyers is so large
that each buyer buys an insignificant part of the total supply and has no control over the market price. Perfect competition has the following
features
2b. Perfect competition has the following characteristics:
- There is a large number of firms (producers and sellers) and buyers of a product
- Products of all firms are homogeneous
- There is freedom of entry and exit by firms
- All firms and buyers have perfect information about the prevailing market prices of the product.
- Both buyers and sellers are “price takers” and not “price makers”
3a. The question often asked is why do consumer cooperatives do better in advanced economies than in developing countries? Yahaya is of the view that consumer cooperatives in Nigeria have not done well because her economy is predominantly agriculture
driven. This can be explained in terms of internal and external factors:
- Little need for consumer cooperative
- Low purchasing power
- Higher overhead cost and stiff competition from small retailers
- Unavailability of some cooperatives due to their smallness
- Poor management and organisation
- Lack of supportive loyalty of members and general awareness on the part of the public
- Over-dependence of societies on private manufacturers and
producers for the supply of goods
- Over-dependence of the country as whole on importation
- Over-dependence on manufactured goods instead of on basic need items most of which can be produced locally
- Too much government involvement in the affairs of cooperatives
- Corruption of government cooperative officials and cooperative officers and employees
- Stiff competition from well managed big stores
3b. When consumer cooperative operate efficiently, they have the effect of raising the standard of living of the members/customers, making the retail trade competitive. Some of the specific functions of consumer
cooperatives are:
- Protecting consumer interest during periods of scarcity of goods and uncontrollable inflation
- Making goods available to a cross section of the community
- Ensuring the sale of pure and unadulterated goods
- Helping the government in its distribution policy
- Helping to educate consumers
- Ensuring competition
- Offering credit sales to their members
4a. - He must have the capacity to adjust decision-making to a business where patrons or suppliers are also members and be able to deal with complex issues to achieve an equitable treatment of owners/patrons
- He must be a good administrator: This is to say he must understand various efficient methods of doing the job; delegate responsibilities while maintaining authority; work in a service oriented organisation
- Must have the education and experience that go with the job
- Must have thorough understanding of the operations of cooperatives. Understand the purpose of the business/service, understand his position between the Board and the members; promote the cooperative to non-members
4b. - Share Capital: This is the money contributed by members of the cooperative when they
join the society and by any subsequent payment. Share capital enables the cooperative to be functional
- Capital Reserve: It is the fund created and maintained within the cooperative business enterprise for different reasons but essentially as a buffer against unforeseen circumstances. Reserves can either statutory or
voluntary. Statutory reserve are backed by relevant cooperative law. It is compulsory whether members like it or not. On the other hand voluntary reserve derives its existence from the free will of members who maintain them as a result of their conviction as to the advantages and its
necessity
- Borrowed Capital: This is sourced from outside the cooperative such as from a third party. The need for it often arises due to the limitations of share capital and reserve capital. It does not remain permanently in the cooperative and it is repayable at a pre-determined interest and date
- Trade Credits: This is an option whereby instead of a cooperative paying cash for the goods and materials procured, it gets credit facility form her customers. It is an arrangement that allows a cooperative delay payment until future date
5a.(i) Salesmanship: It is a key skill adopted in personal selling. In other words, Salesmanship is the tactics of convincing a buyer to buy a product or service
(ii) Pricing: It can be defined as “the process of price determination or price fixing”
(iii) Financing: Without adequate financing the programmes
and policies of the cooperative may not be able to be implemented. Adequate financing of a cooperative business ensures and guarantees the continuity of the enterprise
(iv) Selling: This refers to those activities directed majorly at immediate exchange
5b. - Inaugural Meeting: This first general immediately after registration
- Annual General Meeting: As the name suggests, it takes place once in a year
- Ordinary General Meeting: This is the usual meeting that is held at regular intervals
- Special or Emergency Meeting: This type of meeting is called when there is an emergency or a need has arose that require an urgent action of the cooperative

MKT 301 2018 NOVEMBER PAST QUESTIONS
1a. Outline & explain the criteria for sharing surpluses in a cooperative society
1b. Write short notes on patronage refund and reserved fun
1c. What are the functions of consumer cooperarive in Nigeria?
1d. List and describe 5 types of cooperatives in Nigeria
1e. Describe in details the difference between the top downward and bottom uoward structure
2a. What is the importance of keeping records to a cooperative society
2b. Outline and discuss sources of financing availavle to a cooperative
3a. Write short notes on the following
i. Salesmanship
ii. Pricing
Iii. Financing
iv. Selling/Selling Process
v. Capital Reserve
3b. Outline and explain criteria for sharing surpluses in a cooperative society
4a. Carefully explain the factors that have militated against the growth of consuner cooperative societies in Nigeria
4b. List 5 characteristics associated with perfect competition
5a. What do you understand by perfect competition
5b. Explain 5 similarities & differences between capitalism & cooperative societies

MKT 301 2018 NOVEMBER PAST ANSWERS
1a. In section 34, chapter 98 of the laws of the federation of Nigeria, the criteria for distribution of the surplus are as follows:
- As a registered society shall not pay a dividend or bonus or otherwise distribute any part of its net surplus except as provided under this decree and until the proposed payment or distribution has been approved by the committee of the society
- At least one-fourth of the net profit of registered society as ascertain by the audit report shall be paid into a fund to be called the "reserve fund which shall be applied as specified in this decree but the Director may in case of any registered society of limited liability grant from time to time exemptions from further contributions to the reserve fund or reduce the rate thereof and may at any time revoke the exemption or reduction
- A registered society may, with the approval of the Director, and after one-fourth of the net profit in any year has been paid into a reserve fund, contribute an amount not exceeding 10% of the remainder of the net surplus to an education fund
- In the case of a society of unlimited liability, no distribution of the net surplus shall be made without the approval of the Minister or Commissioner as the case may be
1b. - Reserve Fund: A reserve fund is a savings account or other highly liquid asset set aside by an individual or business to meet any future costs or financial obligations, especially those arising unexpectedly
- Patronage Refund: It is the name for how co-ops send profits back to their owners. Essentially, each owner gets back part of the profit from their own purchases
1c. When consumer cooperative operate efficiently, they have the effect of raising the standard of living of the members/customers, making the retail trade competitive. Some of the specific functions of consumer
cooperatives are:
- Protecting consumer interest during periods of scarcity of goods and uncontrollable inflation
- Making goods available to a cross section of the community
- Ensuring the sale of pure and unadulterated goods
- Helping the government in its distribution policy
- Helping to educate consumers
- Ensuring competition
- Offering credit sales to their members
1d. - Consumer Cooperatives: Its role is to provide affordable price for goods and services which are essential for the overwhelming majority of people
- Credit Cooperatives: Such cooperatives exist for providing savings and loan services to its
members
- Agricultural Cooperatives: They assist their members in input purchase and serve as village bank where farmers can keep saving and also obtain a loan on short term basis at low interest rate. It sometimes undertake marketing function for farmers‟ members
- Housing Cooperatives: It is a cooperative where every member can buy a piece of land, take part in building houses and make investments on a profitable basis in real estate business
- Worker Cooperatives: A worker co-operative is a co-operative owned and democratically
controlled by its employees
1e. The top-down structure relies on higher authority figures to be ones to take decisions; the fate and choice of the lower class will not be considered. In comparison, the bottom-up structure features a decision-making process that gives higher authority figures and the lower class a say
2a. Record keeping helps the cooperative society to evaluate their economic resources as a business concern and to members as owners in decision making
2b. - Share Capital: This is the money contributed by members of the cooperative when they
join the society and by any subsequent payment. Share capital enables the cooperative to be functional
- Capital Reserve: It is the fund created and maintained within the cooperative business enterprise for different reasons but essentially as a buffer against unforeseen circumstances. Reserves can either statutory or
voluntary. Statutory reserve are backed by relevant cooperative law. It is compulsory whether members like it or not. On the other hand voluntary
reserve derives its existence from the free will of members who maintain them as a result of their conviction as to the advantages and its
necessity
- Borrowed Capital: This is sourced from outside the cooperative such as from a third party. The need for it often arises due to the limitations of share capital and reserve capital. It does not remain permanently in the cooperative and it is repayable at a pre-determined interest and date
- Trade Credits: This is an option whereby instead of a cooperative paying cash for the
goods and materials procured, it gets credit facility form her customers. It is an arrangement that allows a cooperative delay payment until future
date
3a. (i) Salesmanship: It is a key skill adopted in personal selling. In other words, Salesmanship is the tactics of convincing a buyer to buy a product or
service
(ii) Pricing: It can be defined as “the process of price determination or price fixing”
(iii) Financing: Without adequate financing the programmes
and policies of the cooperative may not be able to be implemented. Adequate financing of a cooperative business ensures and guarantees the continuity of the enterprise
(iv) Selling: This refers to those activities directed majorly at immediate exchange
3b. In section 34, chapter
98 of the laws of the federation of Nigeria, the criteria for distribution of the surplus are as follows:
- As a registered society shall not pay a dividend or bonus or otherwise distribute any part of its net surplus except as provided under this decree and until the proposed payment or distribution has been approved by the committee of the society
- At least one-fourth of the net profit of registered society as ascertain by the audit report shall be paid into a fund to be called the "reserve fund which shall be applied as specified in this decree but the Director may in case of any registered society of limited liability grant from time to time exemptions from further contributions to the reserve fund or reduce the rate thereof and may at any time revoke the exemption or reduction
- A registered society may, with the approval of the Director, and after one-fourth of the net profit in any year has been paid into a reserve fund, contribute an amount not exceeding 10% of the remainder of the net surplus to an education fund
- In the case of a society of unlimited liability, no distribution of the net surplus shall be made without the approval of the Minister or Commissioner as the case may be
4a. The question often asked is why do consumer cooperatives do better in advanced economies than in developing countries? Yahaya is of the view that consumer cooperatives in Nigeria have not done well because her economy is predominantly agriculture
driven. This can be explained in terms of internal and external factors:
- Little need for consumer cooperative
- Low purchasing power
- Higher overhead cost and stiff competition from small retailers
- Unavailability of some cooperatives due to their smallness
- Poor management and organisation
- Lack of supportive loyalty of members and general awareness on the part of the public
- Over-dependence of societies on private manufacturers and producers for the supply of goods
- Over-dependence of the country as whole on importation
- Over-dependence on manufactured goods instead of on basic need items most of which can be produced locally
- Too mu ch government involvement in the affairs of cooperatives
- Corruption of government cooperative officials and cooperative officers and employees
- Stiff competition from well managed big stores
4b. Perfect competition has the following characteristics:
- There is a large number of firms (producers and sellers) and buyers of a product
- Products of all firms are homogeneous
- There is freedom of entry and exit by firms
- All firms and buyers have perfect information about the prevailing market prices of the product.
- Both buyers and sellers are “price takers” and not “price makers”
5a. Perfect competition is a market situation in which a large number of producers offer a homogeneous product to a very large number of buyers of the product. The number of sellers could be so large that each seller offers a very small fraction of the total supply and therefore has no control over the market price. Similarly, the number of buyers is so large that each buyer buys an insignificant part of the total supply and has no control over the market price
5b. - Like capitalism cooperative also accept the right of private property, the right of contract, inheritance and right to private enterprise
- Cooperatives also use capital to carry on its activities and pay interest for its use
- Like capitalist enterprise, cooperatives employ experts and pay them remuneration based on the quality of service rendered
- Cooperatives also depend on business efficiency for their successes same as enterprises
- Both systems frown at any intervention from the government