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

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

(a)[8]

Identify two fixed costs and two variable costs of BB, then explain why each cost is fixed or variable.

(b)[12]

Consider the weekly forecasts in Appendix 2 for the two possible additional services. Recommend which service Bethany should select. Support your answer with profit calculations for the two services. Sun tan beds. Hairdressing.

Worked solution & mark scheme

This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: Fixed cost - salon rent

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