1.

Shri Ram college of commerce conducts an MBA course entitled global business operations of two
years duration. For admitting students to this course, it holds an entrance examination. The final
selection is based on this examination. This examination consists of four objectives-type papers and
is spread over four days. Each candidate is charged a fee of Rs.500 for taking up this entrance test.
the following data relate to the past two years.

Statement of Net Revenue from the Entrance Test

1998-Rs 1999-Rs
Gross Revenue – (Fees Collected) – (A) 10,00,000 15,00,000

Cost
Evaluation 4,00,000 6,00,000
Question cum Answer Booklets 2,00,000 3,00,000
Examination Hall Rent @Rs.20,000 per day 80,000 80,000
Honorarium to Chief Examiner 10,000 10,000
Supervision charges – 40,000 60,000
(One supervisor for every 100 candidates at the rate of Rs.500
per day)
General Administration charges 60,000 60,000
Total Cost(B) 7,90,000 11,10,000
Net Revenue (A)-(B) 2,10,000 3,90,000
You are required to compute

(a) The break-even number of candidates

(b) The number of candidates to be enrolled if desired net income is Rs.1,00,000.