Final answer:
Entertainment managers use break-even analysis to determine ticket pricing for a venue with a limited occupancy to maximize revenue or cover costs, considering elastic demand and venue-related costs.
Step-by-step explanation:
Entertainment managers dealing with a venue that has an occupancy limit will typically engage in break-even analysis to determine the optimal ticket pricing and quantity sold to either maximize revenue or cover costs. If the demand for tickets is elastic, meaning that the quantity demanded responds significantly to price changes, managers have to consider the trade-offs between ticket price and quantity sold. When a band is able to sell all available seats by cutting the price, they maximize their current venue's capacity. However, if they consider moving to a larger venue, they must weigh the potential for increased ticket sales against the additional costs that may be incurred. The ideal situation is finding the highest revenue point within the constraints of venue size and fixed costs associated with the performance.