A concert promoter is planning a single performance of J.S. Bach's Mass in B minor by...

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A concert promoter is planning a single performance of J.S. Bach's Mass in B minor by a choir and organist. Several venues are being considered, all of which have a pipe organ, and are accessible for those with physical challenges. The seating capacities and rental fees are. All tickets sell for $30, but $5 of this is a ticket agency fee and taxes. In addition to the rents mentioned above, for all tickets sold beyond the first 800, the promoter will pay 20% of the incremental revenue to the venue. Hence the promotor receives a net of $25 per ticket for the first 800 tickets, and 0.8(25) = $20 per ticket for all other tickets sold. The promotor believes that the demand will be as follows: 400 30%; 700 25%; 1000 20% ; 1300 15%; and 1600 10%. Aside from the aforementioned costs, there will be $16,000 required for professional fees, advertising, and so on. Venue Seats Rent Church 500 $400 Cathedral 900 $800 Concert Hall Basilica 1400 $1100 1500 $1200 (a) Construct a payoff matrix (similar to the one in Example 4 in 08Lecture-Ch13.doc) which can be used to determine which venue the Promoter should rent. Which venue should the Promoter rent if the Promoter wants to be conservative? Which venue to rent if Promoter wants to take an expected value approach. (6+1+2=9 marks) A concert promoter is planning a single performance of J.S. Bach's Mass in B minor by a choir and organist. Several venues are being considered, all of which have a pipe organ, and are accessible for those with physical challenges. The seating capacities and rental fees are. All tickets sell for $30, but $5 of this is a ticket agency fee and taxes. In addition to the rents mentioned above, for all tickets sold beyond the first 800, the promoter will pay 20% of the incremental revenue to the venue. Hence the promotor receives a net of $25 per ticket for the first 800 tickets, and 0.8(25) = $20 per ticket for all other tickets sold. The promotor believes that the demand will be as follows: 400 30%; 700 25%; 1000 20% ; 1300 15%; and 1600 10%. Aside from the aforementioned costs, there will be $16,000 required for professional fees, advertising, and so on. Venue Seats Rent Church 500 $400 Cathedral 900 $800 Concert Hall Basilica 1400 $1100 1500 $1200 (a) Construct a payoff matrix (similar to the one in Example 4 in 08Lecture-Ch13.doc) which can be used to determine which venue the Promoter should rent. Which venue should the Promoter rent if the Promoter wants to be conservative? Which venue to rent if Promoter wants to take an expected value approach. (6+1+2=9 marks)