Question

The Book of Mormon is one of the biggest musical hits on Broadway. It has received many awards including Tony and Grammy Awards. According to Wikipedia, "High attendance coupled with aggressive pricing allowed the financial backers to recoup their investment of $11.4 million after just nine months of performances." While the highest ticket price was $477, the average price is $170. What is the variable cost per ticket

Answer 1

variable cost per ticket = $129.60

Step-by-step explanation:

some information is missing and I looked it up:

30 performances per month

1,100 seats in the theater and 95% occupancy rate

number of tickets sold during the first 9 months = 30 x 9 x 1,100 x 0.95 = 282,150 tickets

total revenue during the first 9 months = 282,150 x $170 = $47,965,500

variable costs = total revenue - fixed costs = $47,965,500 - $11,400,000 = $36,565,500

variable cost per ticket = $36,565,500 / 282,150 tickets = $129.5959 ≈ $129.60