Question

QUESTION 12 (4 Marks) Consider the following scenario: Steven owns his own auto repair shop. He uses his own premises as a workshop. If he had rented his premises to someone else, he would have received R18 000 in rent. He initially invested R50 000 in his business to buy tools and machines. If he had invested the money, he could have earned 10% per year on the money, which is R5 000 per year. If he did not work for himself, he could have earned a salary of R60 000. His expenditure for the year consisted of the following: Oil, petrol, sparkplugs, fan belts and other materials: R70 000 Salary for two junior mechanics: R35 000 Admin costs: R15 000 Assume that the total revenue of the auto shop is R230 000. Calculate Steve's economic profit. a) R203 000 b) R110 000 c) R27 000 d) R32 000 QUESTION 13 (4 Marks) Use the demand diagram below to answer this question. Note that P × Q equals $900 at every point on this demand curve. Which of the following statements correctly describes own-price elasticity of demand, for this particular demand curve? I. Demand is unit elastic at a price of $30, and elastic at all prices greater than $30. II. Demand is unit elastic at a price of $30, and inelastic at all prices less than $30. III. Demand is unit elastic for all prices. a) I and II only. b) I only. c) I, II and III. d) III only.

          QUESTION 12
(4 Marks)
Consider the following scenario:
Steven owns his own auto repair shop.
He uses his own premises as a workshop. If he had rented his premises to someone else, he would have received R18 000 in rent.
He initially invested R50 000 in his business to buy tools and machines. If he had invested the money, he could have earned 10% per year on the money, which is R5 000 per year.
If he did not work for himself, he could have earned a salary of R60 000.
His expenditure for the year consisted of the following:
Oil, petrol, sparkplugs, fan belts and other materials: R70 000
Salary for two junior mechanics: R35 000
Admin costs: R15 000
Assume that the total revenue of the auto shop is R230 000.

Calculate Steve's economic profit.
a) R203 000
b) R110 000
c) R27 000
d) R32 000

QUESTION 13
(4 Marks)
Use the demand diagram below to answer this question. Note that P × Q equals $900 at every point on this demand curve.

Which of the following statements correctly describes own-price elasticity of demand, for this particular demand curve?
I. Demand is unit elastic at a price of $30, and elastic at all prices greater than $30.
II. Demand is unit elastic at a price of $30, and inelastic at all prices less than $30.
III. Demand is unit elastic for all prices.
a) I and II only.
b) I only.
c) I, II and III.
d) III only.

QUESTION 12
(4 Marks)
Consider the following scenario:
Steven owns his own auto repair shop.
He uses his own premises as a workshop. If he had rented his premises to someone else, he would have received R18 000 in rent.
He initially invested R50 000 in his business to buy tools and machines. If he had invested the money, he could have earned 10% per year on the money, which is R5 000 per year.
If he did not work for himself, he could have earned a salary of R60 000.
His expenditure for the year consisted of the following:
Oil, petrol, sparkplugs, fan belts and other materials: R70 000
Salary for two junior mechanics: R35 000
Admin costs: R15 000
Assume that the total revenue of the auto shop is R230 000.

Calculate Steve's economic profit.
a) R203 000
b) R110 000
c) R27 000
d) R32 000

QUESTION 13
(4 Marks)
Use the demand diagram below to answer this question. Note that P × Q equals 900 at every point on this demand curve.

Which of the following statements correctly describes own-price elasticity of demand, for this particular demand curve?
I. Demand is unit elastic at a price of30, and elastic at all prices greater than 30.
II. Demand is unit elastic at a price of30, and inelastic at all prices less than 30.
III. Demand is unit elastic for all prices.
a) I and II only.
b) I only.
c) I, II and III.
d) III only.

Added by Sabelo H.

Question

Please give Ace some feedback