{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Krajewski SN Supplement A

# Krajewski SN Supplement A - Supplement A Decision Making A...

This preview shows pages 1–3. Sign up to view the full content.

Supplement A Decision Making A. Break-even Analysis 1. Evaluating services or products a. Assumptions and definitions b. Break-even quantity: Algebraic approach pQ = F + cQ c p F Q - = c. Break-even quantity: Graphic Approach with Example A.1 d. Sensitivity analysis with Example A.2 SN:A-1

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
SN:A-2 Supplement A Decision Making 2. Application A.1: Break-Even Analysis for Evaluating Products or Services The Denver Zoo must decide whether to move twin polar bears to Sea World or build a special exhibit for them and the zoo. The expected increase in attendance is 200,000 patrons. The data are: Revenues per Patron for Exhibit Gate receipts \$4 Concessions \$5 Licensed apparel \$15 Estimated Fixed Costs Exhibit construction \$2,400,000 Salaries \$220,000 Food \$30,000 Estimated Variable Costs per Person Concessions \$2 Licensed apparel \$9 Is the predicted increase in attendance sufficient to break even? a. Graphical solution of Denver Zoo problem Q TR = pQ TC = F + cQ 0 250,000 Where p = F = c = 0 1 2 3 4 5 6 7 0 50 100 150 200 250 Q (thousands of patrons)
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

### Page1 / 7

Krajewski SN Supplement A - Supplement A Decision Making A...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online