Waec Model Questions Vol1 2023 Economics Question 22

Practice objective / multiple choice question 22 from the 2023 Waec Model Questions Vol1 Economics examination.

Waec Model Questions Vol1 2023 Economics Objective / Multiple Choice Hard Difficulty
Question 22 WAEC_MODEL_QUESTIONS_VOL1 • 2023 • ECONOMICS • objective

A transport company operates a 50‑seat bus on a 200 km round‑trip route. Fixed costs per trip (driver's salary, depreciation) amount to N150 000, and the variable cost is N250 per kilometre. The ticket price per passenger is N2 500. Government regulation requires that at least 60 % of the seats be occupied on each trip. Determine the minimum number of passengers needed for the company to cover its total cost on a trip, and state whether the regulation is binding (i.e., whether the required occupancy alone ensures cost coverage).

Answer Options

Correct Answer A. Not feasible; break‑even requires 80 passengers which exceeds the bus capacity of 50, so the regulation does not ensure cost coverage.
B. Feasible; break‑even requires 30 passengers, well below the bus capacity of 50, therefore the regulation guarantees cost coverage.
C. Not feasible; break‑even requires 55 passengers which exceeds the bus capacity of 50, so the regulation is binding.
D. Feasible; break‑even requires 45 passengers which is below the bus capacity of 50, so the regulation ensures cost coverage.
Correct Answer
A
Correct Option:
Not feasible; break‑even requires 80 passengers which exceeds the bus capacity of 50, so the regulation does not ensure cost coverage.

About This Question

This is Waec Model Questions Vol1 2023 Economics Question 22. It is one of the objective questions from the 2023 Waec Model Questions Vol1 Economics examination.

Difficulty level: Hard .

View More Waec Model Questions Vol1 2023 Economics Questions More Waec Model Questions Vol1 Practice Questions Back to Questions

Master the Exam!

You've seen a preview, but there are thousands more questions plus AI tutor to break down complex solutions.

Unlock Full Access Available for Android & Windows
Chat with Support