The Lakeside Symphony Association is a not-for-profit organization. The primary function of the association is to operate the Lakeside Symphony Orchestra for the benefit of local citizens. The board of directors of the organization is discussing ticket prices for the upcoming season. Ticket receipts do not cover all costs of a concert; donations must be solicited for the remainder, but finding enough donors is difficult, and funds are always scarce. Each concert has fixed orchestra costs of approximately 28,000, primarily for paying the musicians. The only variable costs are programs, tickets, and refreshments served at a reception following the concert; these total about 2 per attendee. Orchestra managers estimate that they can sell 1,300 tickets for the average concert at 12, 1,100 tickets at 15, or 800 tickets at 20. Which option do you recommend? Why? Are the financial measurements used in this chapter appropriate for a not-for-profit situation like this? Why or why not? What nonfinancial considerations should enter into the decision?

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