QUESTION 1

1 a)

1 b)

1 c)

1 d)

1 e)

1 f)

1 g)

QUESTION 2

2 a)

2 b)

QUESTION 3
3 a) Advantages doing Break-even Analysis An analysis to determine the point at
which revenue received equals the costs associated with receiving the revenue. Breakeven analysis calculates what is known as a margin of safety, the amount that
revenues exceed the break-even point. This is the amount that revenues can fall while
still staying above the break-even point. Break-even analysis is a supply-side analysis;
that is, it only analyzes the costs of the sales. It does not analyze how demand may be
affected at different price levels.
For example, if it costs $50 to produce a widget, and there are fixed costs of $1,000,
the break-even point for selling the widgets would be:
If selling for $100: 20 Widgets (Calculated as 1000/(100-50)=20)
If selling for $200: 7 Widgets (Calculated as 1000/(200-50)=6.7)
In this example, if someone sells the product for a higher price, the break-even point
will come faster. What the analysis does not show is that it may be easier to sell 20
widgets at $100 each than 7 widgets at $200 each. A demand-side analysis would give
the seller that information.

3 b i) Break-even point

3 b ii)
Profit = Sales Costs, let x=units;

Therefore, to yield a profit of RM11,000, 4,889 units of products need to be produced.

QUESTION 4
Jorn should choose the option, which will give him the best future value as the sums
of money will only be received in the future;
a) Option 1: Jorn will receive RM100,000 in t=10
b) Option 2: If Jorn invested the sums he received at 8% p.a, in 10 years he will
obtain;

Therefore, the best option is Option 2, as Jorn will obtain a bigger value of money by
RM4,069.89 in 10 years.