Question

The cost of running a movie theatre is Rs. 10,000 per day, plus additional Rs. 5000 per show. The theatre has 200 seats. A new movie released on Friday. There were three shows, where the ticket price was Rs. 250 each for the first two shows and Rs. 200 for the late-night show.

For all shows together, total occupancy was 80%. What was the maximum amount of profit possible?

Accepted Answer

D. Total running cost $= 10000 + 3 	imes 5000 = 	ext{Rs. } 25,000$. Total seats available across 3 shows $= 3 	imes 200 = 600$. Total occupancy $= 80\% 	ext{ of } 600 = 480$ seats filled (120 empty seats). To maximize revenue, maximize sales of higher-priced tickets (Rs. 250) and put all 120 vacant seats in the late-night show (Rs. 200). - Show 1 (Rs. 250): 200 seats $= 200 	imes 250 = 50,000$ - Show 2 (Rs. 250): 200 seats $= 200 	imes 250 = 50,000$ - Show 3 (Rs. 200): $200 - 120 = 80$ seats $= 80 	imes 200 = 16,000$ Total Revenue $= 50000 + 50000 + 16000 = 	ext{Rs. } 1,16,000$. Maximum Profit $= 1,16,000 - 25,000 = 	ext{Rs. } 91,000$.

Maximum Profit for Movie Theatre

Explanation

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