1.1 Calculate the annual return (r), on the Eggomatic Egg Boiler.

1.2 a) Describe the characteristics of a manager such as Thuli who is risk averse. Relate your answer to the scenario above.

1.2 b) Graphically illustrate and explain two other risk preference categories. (10)

Thuli Pennypincher has recently been appointed as Financial Manager of Thabo's Management Company LTD. (TMC) and manages a portfolio of 10 fast food outlets on behalf of the owners, Sibo's Greasy foods (SGF), with the 10 outlets located across the Gauteng Province. At the beginning of the financial year 2019 (1/ January 2019), TMC purchased a "Eggomatic Egg Boiler", and then leased it out to the Centurion SGF outlet. This is the flagship store and main revenue generator in the 10 -store portfolio. Thuli is now not so sure, as she reviews the year end accounts (as at 31 December 2019), whether this was such a good idea. She would now like to calculate whether TMC made a satisfactory return on their investment. Her Cost and Management Accountant, Mr. Gray Beancounter, has emailed her the following figures: From a risk tolerance perspective, Thuli, who has had several years' experience in the fastfood industry, considers herself a risk-averse manager