A city introduces a new bus route. The fixed operating cost per day is $1200$ pounds. The variable cost is $0.75$ pounds per passenger. The standard fare is $2.50$ pounds, but $20\%$ of passengers receive a $50\%$ concession. The route uses a bus that holds $60$ seats and makes $8$ trips per day.

(a) Calculate the minimum number of passengers required each day for the route to break even.

(b) Based on the bus capacity, state whether this break‑even level is achievable.

Question

A city introduces a new bus route. The fixed operating cost per day is $1200$ pounds. The variable cost is $0.75$ pounds per passenger. The standard fare is $2.50$ pounds, but $20\%$ of passengers receive a $50\%$ concession. The route uses a bus that holds $60$ seats and makes $8$ trips per day.

(a) Calculate the minimum number of passengers required each day for the route to break even.

(b) Based on the bus capacity, state whether this break‑even level is achievable.

Accepted Answer

800 passengers; not achievable because the maximum capacity is 480 passengers.

Gce Model Questions Vol1 2019 Geography Question 36

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