of the best seats $($the stalls: $60\%$ of the total number of seats$)$ and $10$ for each of the worst

seats $($the balcony: $40\%$ of the total number of seats$).$ The GAC would expect to sell about

$450$ to $500$ tickets. Of course it could raise prices, e$.$g$.$ from $15$ to $17\mathrm{.}50,$ but this decision

could lead to less demand for tickets for the solo performance, a kind of performance with a

limited appeal.

In other cases, particularly those involving variable$-$fee contracts, the GAC negotiates a

ticket price with the artist or company involved. The comedian Bram de Jong, for example,

does not want the price of a stalls or balcony ticket to exceed $17\mathrm{.}50,$ otherwise it will be too

high for price$-$conscious students. The GAC, too, tends to keep prices reasonably low,

because it believes that people on low incomes should have access to all kinds of art forms.

To get certain performances, e$.$g$.$ pop concerts, the GAC has to take part in bidding

procedures, as was mentioned before. In these cases, the GAC is faced with even more

variables, namely ticket price, fixed fee, variabele fee, and the chance of securing a contract.

Assignment $1$

Please calculate the estimated financial results of the contracts mentioned above concerning

the next performances by:

the comedian Bram de Jong;

the actress Bridget Masland;

the band Double Dutch;

and evaluate these contracts while taking the GAC's objectives into consideration.

Randy Newman at Groningen

Late January and early February $2000,$ Randy Newman gave a number of performances in the

Netherlands. This famous American singer$-$songwriter and pianist $-$ whose songs include

'Short people', 'Sail away' and 'Political science' $-$ also visited Groningen. On February $1,$

$2000,$ he performed in the large concert hall of the Groningen Arts Centre, which was sold

out.

Randy Newman's Dutch tour had been planned in February $1999,$ when the GAC was

invited to join several others in bidding for a contract. During the past ten years the artist had

performed twice in the concert hall, which was sold out on both occasions. Tickets for those

performances were priced at $17\mathrm{.}50$ and $18\mathrm{.}75$ respectively. In February $1999$ director Van

Tol emphasized the importance of Randy Newman's visit to Groningen as follows, 'Randy

Newman is a fine artist who is still in tune with the times. And his performance will generate

publicity over Groningen, newspapers will write about it and it will draw people from far and

wide'.

Randy Newman's impresario specified the following terms:

a$.$ Randy Newman $($and his impresario$)$ would receive $50\%$ of the box$-$office receipts

and the GAC would receive the remaining $50\%$;

b$.$ the GAC would have to pay a fixed amount to Randy Newman $($and his impresario$)$

if it were the highest bidder and its bid was therefore accepted;

c$.$ the GAC would be allowed to set a ticket price, without prejudice to the provisions

under $($a$).$

Assignment $2$

${?}^1$ In all the assignments you can disregard taxes.