Question

A semiprofessional baseball team near your town plays two home games each month at the local baseball park. The team splits the concessions 50/50 with the city but keeps all the revenue from ticket sales. The city charges the team $500 each month for the three-month season. The team pays the players and manager a total of $2500 each month. The team charges $10 for each ticket, and the average customer spends $8 at the concession stand. Attendance averages 100 people at each home game.

Part 1   (4 points)

The team earns an average of   $   in revenue for each game and   $   of revenue each season.

With total costs of   $   each season, the team finishes the season with   $   of profit.

Part 2   (1 point)

In order to break even, the team needs to sell      tickets for each game. Round to the nearest whole number.

Answer 1

The team earns 10 per ticket which is attended by 100 people who spends 8 on stand and the team reeives 50% of it = 4

Number of games = 2 per month = 2*3 = 6

Revenue per customer = 10+4 = 14

TR per game = 14*100 = 1400

TR for 6 games = 1400*6 = 8400

TC=2500*3+500*3 = 9000

Profit = TR-TC = 8400-9000 = -600

The team earns an average of 1400 in revenue for each game and 8400 of revenue each season.

With total costs of 9000 each season, the team finishes the season with -600 of profit(LOSS)

Part 2:

To break even, TR=TC

Let the total games sold be X

then TR = 10X*2+8X*2 = 20X+16X = 36X

TC = 500+2500+4X*2 = 3000+8X

TR=TC

3000+8X = 36X

3000 = 36X-8X

X = 3000/28 = 107.14

In order to break even, the team needs to sell 107 tickets for each game.