Neco Model Questions Vol1 2019 Economics Question 30
Practice objective / multiple choice question 30 from the 2019 Neco Model Questions Vol1 Economics examination.
A bakery sells loaves of bread at ₦500 each. Fixed costs are ₦120,000 per month and variable cost per loaf is ₦300. The bakery sells 1,200 loaves per month. It is considering a 10% discount on the selling price for customers who buy exactly 5 loaves in a single purchase. Assume that 20% of the loaves (i.e., 240 loaves) are sold in such bulk purchases and the remaining loaves are sold at the regular price. Will the discount policy increase the bakery's monthly profit? State the change in profit (in Naira).
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About This Question
This is Neco Model Questions Vol1 2019 Economics Question 30. It is one of the objective questions from the 2019 Neco Model Questions Vol1 Economics examination.
Difficulty level: Medium .
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