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Business Studies paper 3 Doubt - URGENT!!

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Azland:
I need explanations for the following questions.

May/June 2010 - Paper 31

Question 5a of Section A - answer is listed as 60 and 56 on the ms..cant figure out how.

Heres the link to the paper

http://xtremepapers.net/CIE/index.php?dir=International%20A%20And%20AS%20Level/9707%20-%20Business%20Studies/&file=9707_s10_qp_31.pdf

Please reply as soon as possible!

Dasith:

--- Quote from: Azland on September 10, 2011, 12:25:19 am ---I need explanations for the following questions.

May/June 2010 - Paper 31

Question 5a of Section A - answer is listed as 60 and 56 on the ms..cant figure out how.

Heres the link to the paper

http://xtremepapers.net/CIE/index.php?dir=International%20A%20And%20AS%20Level/9707%20-%20Business%20Studies/&file=9707_s10_qp_31.pdf

Please reply as soon as possible!


--- End quote ---

well this took me a while to figure out :)

To get da ans u start from the last branch of one of the options , say option 2

0.8 x  40 = 32
0.2 x  20 =(04)
             =28
Next(u go to da next brance)

0.8 x(28 +72) = 80
0.2 x(20)       =(04)
                   = 76

76 is the possible return of the option 2 which incurs a start up cost of 20.
so 76-20 = 56.
you do the same for the other option u get ans 60

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