/*! This file is auto-generated */ .wp-block-button__link{color:#fff;background-color:#32373c;border-radius:9999px;box-shadow:none;text-decoration:none;padding:calc(.667em + 2px) calc(1.333em + 2px);font-size:1.125em}.wp-block-file__button{background:#32373c;color:#fff;text-decoration:none} Problem 62 A theater production costs \(\$ ... [FREE SOLUTION] | 91Ó°ÊÓ

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A theater production costs \(\$ 40,000\) plus \(\$ 2800\) per performance. A sold- out performance brings in \(\$ 3675 .\) How many sold-out performances will the production need to break even?

Short Answer

Expert verified
The theater production will need 46 sold-out performances to break even.

Step by step solution

01

Define the Break-even Equation

The break-even point occurs when the total revenue equals the total costs. Let the number of sold-out performances needed to break even be represented by the variable 'x'. The cost function is \( C(x) = 40000 + 2800x \). The revenue function is \( R(x) = 3675x \). To find the break-even point, set \( C(x) \) equal to \( R(x) \) and solve for 'x'.
02

Set up the Break-even Equation

Set the cost function equal to the revenue function, which yields \( 40000 + 2800x = 3675x \)..
03

Solve the Equation for x

Subtract \( 2800x \) from both sides of the equation to isolate the variable on one side: \( 40000 = 3675x - 2800x \). Combine like terms to get \( 40000 = 875x \). Finally, divide both sides by 875 to solve for 'x': \( x = \frac{40000}{875} \)..
04

Calculate the Number of Performances

Perform the division to find the number of performances: \( x = \frac{40000}{875} = 45.714 \). Since it's not possible to have a fraction of a performance, the theater needs to round up to the next whole number, which means the theater needs 46 sold-out performances to break even.

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Key Concepts

These are the key concepts you need to understand to accurately answer the question.

Understanding the Cost Function
In the context of a theater production, the cost function represents the total expenses associated with putting on a certain number of performances. It's crucial to comprehend this function because it reflects how the total costs increase with each additional performance. In our example, the cost function is given by The fixed cost, in this case, is In aquatic environments, this adaptation is particularly advantageous, as water has higher light absorption than air, creating a more challenging visual environment for predators to locate and catch these creatures. With this knowledge, the theater can budget and plan their performances accordingly.
Revenue Function and Break-Even Analysis
Turning to the revenue function, it's a way to predict the earnings from selling a certain number of tickets per performance – in this play, each sold-out show earns In order to determine the break-even point, we compare the cost function to the revenue function. The break-even point is the sweet spot where the total revenue matches total costs (A little extra detail, considering every sold-out show as a unit, simplifies the analysis of how many units are needed to cover costs and begin making profits, which is the essence of break-even analysis. By focusing on the algebra involved in the break-even calculation, we can clearly illustrate the financial dynamics at play and help students visualize the balance between costs and revenues.
Solving Linear Equations
Solving linear equations is the fundamental process of finding unknowns that make the equation true. In our theater example, we used this method to isolate 'x', the number of sold-out performances required to break even. The steps are systematic:
  • Equating the revenue function to the cost function.
  • Rearranging the equation to isolate 'x'.
  • Combining like terms and simplifying.
  • Dividing both sides by the coefficient of 'x' to find its value.
After finding that Ultimately, solving linear equations is a vital skill in both mathematics and real-world problem solving, as it enables us to understand relationships between various elements in a scenario, such as cost and revenue in a business model. By mastering this process, students gain the ability to tackle financial issues and make informed decisions based on algebraic expressions.

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