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Lifetime Escapes generates average revenue of $7500 per person on its 5-day package tours to wildlife parks in Kenya. The variable costs per person are
Lifetime Escapes generates average revenue of $7500 per person on its 5-day package tours to wildlife parks in Kenya. The variable costs per person are as follows: Airfare $1600 Hotel accommodations 3100 Meals 600 Ground transportation 300 Park tickets and other costs 700 Total $6300 Annual fixed costs total $570000. Required 1. Calculate the number of package tours that must be sold to break even. 2. Calculate the revenue needed to earn a target profit of $102000. 3. If fixed costs increase by $19000, what decrease in variable cost per person must be achieved to maintain the break- even point calculated in requirement 1? 4. The general manager at Lifetime Escapes proposes to increase the price of the package tour to $8200 to decrease the break-even point in units. Using information in the original problem, calculate the new break-even point in units. What factors should the general manager consider before deciding to increase the price of the package tour
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