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Transcription of this question: 4.It is now mid-2019. Production of solar power systems has been going for over a year. Saleshave exceeded forecasts and reached 5000 systems for the year. All profits have been reinvestedinto developing a portable biomass source of electricity’ (PBS) as an altemative to solar powersystems.The PBS technology is now fully developed and tested. Su has data to help her decide whether togo into production. The new production facility will cost $1 million.The costs and the price of the product once production has begun are estimated in Table 3.Table 3: Estimated cost and price data for PBSFixed costsVariable costsLikely price$200 000 per year$70 per PBS$90 per PBSIn a separate development, Doomay Foundation (OF), a multibillion-dollar charity established bythe owners of one of the world’s largest IT businesses, has approached Su. The foundation hasa major IT initiative to bring IT to schools in Afghanistan, Myanmar and Bangladesh. By forming ajoint venture, DF could use AS’s expertise and local knowledge to help solve some of the electricitysupply and IT problems in Afghanistan. DF would have majority ownership in the joint venture,provide most of the senior managers, and is likely to expect changes in the way AS operates.AS would have to significantly increase the production of solar power systems and would haveto restructure. Some managers may lose influence over decisions. Su is worried that herAfghanistan project (AS) would take second place. However, she sees this as a huge opportunityto make a real change in young people’s lives.International Baccalaureate Organization 2018]portable biomass source of electricity: a means of generating electricity using theheat obtained from burning plant material and/or animal waste(a)(c)Define two characteristics of a charity.(i) Using the information in Table 3, calculate the break-even output for portablebiomass sources of electricity (show all your working).(ii) Comment on the usefulness to AS of break-even analysis.Recommend whether AS should enter into a joint venture with DF.[2][2][6][10]

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