Fixed Cost

The Seattle Walks is an annual fund-raising event that raises money for research on child's autism. The Walk costs $80,000 to stage even if nobody shows up. To Encourage people to participate, each walker is given a keychain that costs the Walk $2.00 and refreshments that cost an average of $10 per person. This year, the walkers got a $10,000 grant from the Parks and Recreation Department to offset part of costs associated with staging the Walk. The walk raises money by asking each walker to pay $15 to register and requires each walker to solicit sponsors who agree to pay $1.0 per mile for each of the the 10 miles that walker completes. In the past, all of the walkers have completed the ten-mile course and have had an average of 20 sponsors.

1. How many walkers have to participate in the Walk for the event to at least break even?

2. If the cost of refreshments per walker increases from $10 to $11, how many additional walkers will be need to break even?

3. Prepare a flexible budget for the event highliting three different levels of walker participating (begin with the number of workers necessary for the event to break even, then use two more levels of participation – above and below the break-even point)?

Thank you!!


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