Hello, isn't it 2205 members per week? How are we deciding that this is the number per year? (Not multiplying by 52)

Question

Deleted · Accepted Answer

The missing piece here is cost exhibit. It states that each player plays one hour per week. This means that if you know the total number of hours played by week (2,205), you know how many members the club has.

As they want to know the annual charge, you now just need to divide the total annual costs by the number of members to know the minimum membership fee to break even at 70% utilization.

Ian · Answer

Hi there,

Yes, you need to check the cost exhibit.

I recognize you are probably doing this case on your own, however, in a real case, make sure to clarify your understanding of the exhibit. "Small" misunderstandings like this could turn the case in the wrong direction!