1) Micromedia offers computer training seminars on a variety of topics. In the s
ID: 376585 • Letter: 1
Question
1) Micromedia offers computer training seminars on a variety of topics. In the seminars each student work at a personal computer, practicing the particular activity that the instructor is presenting. Micromedia is currently planning a two-day seminar on the use of Microsoft Excilin Statistical analysis. The projected fee for the seminar is $300 per student. The cost for the conference room, instructor compensation, lab assistants, and promotion is $4,800. Micromedia rents computers for its seminars at a cost of $30 per computer per day. a. Develop a model for the total cost to put on the seminar. Let X represent the number of students who enroll in the seminar. Develop a model for the total profit if X students enroll in the seminar. Micromedia has forecasted an enrollment of 30 students for the seminars. How much profit will be earned if their forecast is accurate. b. c. d. Compute the breakeven point.Explanation / Answer
Number of students enrolled = X
Total number of computers rented = Total number of students enrolled = X
Thus, Total cost for the seminar
= Cost of conference room. Instructor, lab assistant etc + Computer rent / day x number of days of seminar x Number of students
= $4800 + $30 x 2 x X
= 4800 + 60.X
Total revenue from students = $300/ student x Number of students = 300.X
Thus,
Total profit = Total revenue – Total cost = 300.X – 4800 – 60.X = 240.X – 4800
When number of students enrolled is 30 , then X = 30
Total profit which will be earned under such case = 240 x 30 – 4800 = $7200 - $4800 = $2400
Let the breakeven point = N number of students.
At breakeven point , Total revenue = Total cost
Hence,
300.N = 4800 + 60.N
Or, 300.N – 60.N = 4800
Or, 240.N = 4800
Or, N = 20
BREAKEVEN POINT = 20
BREAKEVEN POINT = 20
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