Waec Model Questions Vol1 2017 Economics Question 11

Practice objective / multiple choice question 11 from the 2017 Waec Model Questions Vol1 Economics examination.

Waec Model Questions Vol1 2017 Economics Objective / Multiple Choice Hard Difficulty
Question 11 WAEC_MODEL_QUESTIONS_VOL1 • 2017 • ECONOMICS • objective

A transport company operates a bus service on a popular route. The daily demand for seats (in passengers) is given by Q = 2000 - 30P, where P is the fare per passenger in Naira. The variable cost per passenger is N20 and the fixed daily cost is N10,000. The company can run at most two buses per day, each with a capacity of 500 seats, so the total daily capacity is 1000 passengers. Determine the fare that maximizes the company's daily profit while respecting the capacity limit, and state the maximum profit (both to two decimal places).

Answer Options

A. Optimal fare = N38.00 per passenger; Maximum profit = N5,200.00
Correct Answer B. Optimal fare = N43.33 per passenger; Maximum profit = N6,333.33
C. Optimal fare = N50.00 per passenger; Maximum profit = N6,000.00
D. Optimal fare = N45.00 per passenger; Maximum profit = N6,100.00
Correct Answer
B
Correct Option:
Optimal fare = N43.33 per passenger; Maximum profit = N6,333.33

About This Question

This is Waec Model Questions Vol1 2017 Economics Question 11. It is one of the objective questions from the 2017 Waec Model Questions Vol1 Economics examination.

Difficulty level: Hard .

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