Business 0450 · IGCSE · Costs, scale of production and break-even analysis

Costs, scale of production and break-even analysis — practice question

Make use of the information in Appendix 2:
(a(i))[2]

Calculate the break-even level of output per month.

(a(ii))[2]

Calculate the monthly margin of safety for tables.

(a(iii))[4]

Identify four limitations in the use of break-even analysis.

(b)[12]

Use Appendix 2 and Appendix 3, together with the other information. Consider the following three ways FO could adopt to help sustainable development: - source all raw materials only from suppliers that replace what they use - use only packaging that can be recycled - use only electric vehicles to deliver products. Which way should FO select to maximise profit? Support your answer.

Worked solution & mark scheme

This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: Contribution per unit worked out correctly ($125)

  • Full mark scheme, point by point
  • Step-by-step worked solution
  • Write your answer & get it marked instantly by AI