SOLUTION: 1. An event promoter in Belize is selling tickets to her all-inclusive Carnival fete for $150.00 each. She has rented a venue at a cost of $3500 and will incur other fixed costs fo

Question 1197572: 1. An event promoter in Belize is selling tickets to her all-inclusive Carnival fete for $150.00 each. She has rented a venue at a cost of $3500 and will incur other fixed costs for a DJ ($1000), MC ($500), stage ($3,000), event staff ($4,000), insurance ($500), and marketing ($2,500). The variable costs include drinks ($30 per person), and food ($45 per person).
a) What is the revenue function for the event?
b) What is the cost function for the event?
c) Calculate how many tickets need to be sold in order for the event to break even.
d) If the promoter sells 500 tickets:
i. Calculate the revenue
ii. Calculate the cost
iii. Calculate the profit
Answer by Shin123(626) (Show Source): You can put this solution on YOUR website!
a) The revenue function is , since the ticket costs $150 each.
b) The cost function is , which is the fixed cost (adds up to $15,000 total) plus the variable cost ($75 per person for the drinks and food)
c) In order for the event to break even, the revenue must equal the cost, so we have the equation . Subtracting from both sides, we get . Finally, dividing by 75, we get tickets.
i. The revenue is dollars.
ii. The cost is dollars.
iii. The profit is the revenue minus the cost, so it is dollars.
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