CMA Final · Strategic Financial Management · Digital Finance
A neobank charges Rs 20 per payment on a platform with 5,00,000 monthly payments. Fixed monthly cost is Rs 40,00,000 and variable cost is Rs 8 per payment. What is the monthly break-even number of payments?
Contribution per payment is Rs 12 (Rs 20 minus Rs 8). Dividing fixed cost of Rs 40,00,000 by Rs 12 gives a break-even of about 3,33,333 payments a month.
- A3,33,333Correct
- B2,00,000
- C5,00,000
- D4,00,000
Explanation
Contribution per payment = 20 - 8 = Rs 12. Break-even = 40,00,000 / 12 = 3,33,333 payments. Using the price alone gives 2,00,000, which ignores variable cost.
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