Use the Information Below to Answer the Following Question(s)

question 209

Multiple Choice

Use the information below to answer the following question(s) .
Big Sports University is planning to hold a fund raising banquet at one of the local country clubs. It has two options for the banquet:
1. Foothills Country Club
a. Fixed rental cost of $600
b. plus $15.00 per person for food.
2. Downhill Country Club
a. Fixed rental cost of $1,080
b. It will have to hire a caterer who charges $12.00 per person for food.
Big Sports has budgeted $900 for administrative and marketing expenses. It plans to hire a band, which will cost another $400. Tickets are expected to be $40 per person. Any other items required for the event will be donated by its local business supporters.
-The break-even point in tickets sold of option two?

• A) 85 tickets
• B) 76 tickets
• C) 39 tickets
• D) 71 tickets

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Definitions:

Multiply

The mathematical operation of repeated addition of a number by itself a specified number of times.

Simplify

The process of reducing an expression to its simplest form.

Average Cost

The total cost of production divided by the number of goods produced.

Setup Cost

The initial expense required to create a new product or establish a new process, including costs for equipment, facilities, and labor.