Business Studies Multiple Choice Question – 30 December 2017

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Business Studies

A business’s fixed costs are £75 000, selling price per unit is £10, and total variable costs per unit are £5.50. Which ONE of the following is the break-even level of output (to the nearest whole number)?

Select ONE answer only:

  1. 16 667 units
  2. 12 000 units
  3. 10 000 units
  4. 18 500 units
  5. 18 667 units

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 1 – Break-even level of output = Fixed costs / Contribution per unit. Contribution per unit = Selling price per unit – Variable costs per unit. Therefore the breakeven level of output is: £75 000 / (£10 – £5.50) = £75 000 / £4.50 = 16 667 units.

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Author: stuart001uk2014

Referral marketing, business, economics and accounting s​pecialist & corporate mentor

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s