Question 13 (1 point) Assume you are the artistic director of a music band that

Question

Question 13 (1 point) Assume you are the artistic director of a music band that will have a concert in 6 months. The venue reserved for the concert has a capacity of 600 people. You want to sell some tickets in advance at the early-bird price and reserve some tickets for the day of the concert to be sold at the door (at a higher price of course!). Given that you want to maximize the revenue from ticket sales, how many tickets should you sell at the early-bird price, if the early-bird price is $40 and the door-price is $60? Assume the number of customers who prefer to buy their tickets at the door is normally distributed with mean 200 and standard deviation 50. Also assume you can fl up the venue by selling advance tickets but of course that wouldn't generate the highest possible revenue for you. Note: Select the choice that is closest to your answer

Explanation / Answer

Answer:

Total Tickets are = 600 nos.

Since the Ticket sale is at two prices $40 (early Bird) and $60 (door sell)

The door sale probability is with mean of 200 numbers with standard deviation 50. So it comes around 250numbers. So the closest match for the answer is 287 numbers which is most close option given in the question.

Pls refer the working for thsiclose option.

Door Sell Tickets Revenue Early Bird Price Revenue Total Revenue Remarks 421 25260 179 7160 32420 Non preffered, risk in sell of door tickets 381 22860 219 8760 31620 Non preffered, risk in sell of door tickets 503 30180 97 3880 34060 Non preffered, risk in sell of door tickets 182 10920 418 16720 27640 Non preffered, low revenue option 287 17220 313 12520 29740 Preferred option because door buy customer mean is 200 with standard deviation as 50

Related Questions

Navigate

• Browse (All)
• Browse Q
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.