Question

Star Cinemas is considering a contract to rent a movie for $1,980 per day. The contract requires a minimum one-week rental period. Estimated attendance is as follows:


Required
a. Determine the average cost per person of the movie rental contract separately for each day.
b. Suppose that Star chooses to price movie tickets at cost as computed in Requirement a plus $3. What price would it charge per ticket on each day of the week?
c. Use weekly averaging to determine a reasonable price to charge for movie tickets. Round your figures to 2 decimal points.
d. Comment on why weekly averaging may be more useful to business managers than dailyaveraging.


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  • CreatedFebruary 07, 2014
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