Recreational Music Society is a not-for-profit organization that brings guest artists to the community’s greater metropolitan area. The society just bought a small concert hall in the center of town to house its performances. The lease payments on the concert hall are expected to be \($6,000\) per month. The organization pays its guest performers \($2,200\) per concert and anticipates corresponding ticket sales to be \($6,000\) per concert. The society also incurs costs of approximately \($1,400\) per concert for marketing and advertising. The organization pays its artistic director \($47,000\) per year and expects to receive \($23,000\) in donations in addition to its ticket sales.
1. If the Recreational Music Society just breaks even, how many concerts does it hold?
2. In addition to the organization’s artistic director, the society would like to hire a marketing director for \($36,000\) per year. What is the breakeven point? The society anticipates that the addition of a marketing director would allow the organization to increase the number of concerts to 50 per year. What is the society’s operating income/loss if it hires the new marketing director?
3. The society expects to receive a grant that would provide the organization with an additional \($36,000\) toward the payment of the marketing director’s salary. What is the breakeven point if the society hires the marketing director and receives the grant?