Question 1
Stilvan always wanted to run his own business. When he left school he
borrowed money from his parents to start a gardening business. The
business name is Stilvan Grass Cutters. Stilvan bought some equipment
to cut grass and trees. Stilvan delivers leaflets to people's homes to
promote his business.
Table 1 shows data for a typical week for Stilvan's business.
Table 1
Average price per customer $15
Variable cost per job
$7
Weekly overheads
$320
Number of customers
50
Demand for his services is seasonal and this causes problems for Stilvan.
(a) Identify two objectives that Stilvan might have had when he set
up his business.
[2]
(b) Identify two advantages of using leaflets as a method of promotion.
[2]
(e Using the information given in Table 1, draw a break-even chart
for Stilvan's business.