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:

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.

  • CreatedFebruary 07, 2014
  • Files Included
Post your question