You are the owner/manager of a pottery studio and are considering offering a beginners pottery class for a reduced rate. You believe that once your students start sculpting, theyll be hooked and will continue with the classes at your regular prices. You arent sure how to price the discounted beginners class and have gathered the following information: Direct cost per class: $95.00 Indirect studio costs/annual: $140,000 Anticipated # of classes (all): 20/week; 50 weeks Anticipated # of pottery intro classes: 5/week; 50 weeks Anticipated # of students for each pottery class: 20

You were able to determine that the indirect costs ($140,000) consisted of the following: Studio Rental $70,000 Your salary $40,000 Utilities $ 5,000 Office Staff $12,000 Instructor Benefits $ 6,000 Cleaning services $ 6,000 Refreshments $ 1,000

At what price will you offer the discounted beginners class?