The Accompanying Table Shows How Total Donations And Average

Theaccompanying Tableshows How Total Donations Average Donations T

The accompanying table shows how total donations, average donations, total labor costs, and average labor costs vary depending on the number of employees State U hires for its fundraising activities. Complete the following:

• Calculate the total value of donations raised by three employees, and explain the method you used to make this calculation.
• Calculate the total labor cost with four employees, and explain the method you used to make this calculation.
• Analyze the relationship between average benefits and average costs by filling in the blanks in the following statement:

  If the President of State U decides to hire fundraising employees as long as their average benefit exceeds their average cost, then this results in ________ employees being hired and a net benefit (total donations minus total labor costs) of ________.

• Evaluate the marginal benefit (in terms of extra donations) of the 2nd employee.
• Explain how the marginal cost of the 4th employee will increase the total labor cost.
• Determine when the net benefit of hiring fundraisers is the largest.

Paper For Above instruction

The analysis of fundraising efficiency requires a detailed understanding of how total donations and associated costs change with varying numbers of employed fundraisers. The table presented provides key metrics on total donations, average donations, total labor costs, and average labor costs at different staffing levels. Using this data, we can perform multiple calculations and interpret the implications for optimal staffing in fundraising activities.

Calculating Total Donations for Three Employees

The total donations raised by three employees can be derived by multiplying the number of employees by the average donation per employee at that level. For example, if the table indicates an average donation of $X with 3 employees, then the total donations = 3 × $X. This method assumes that the average donation value applies uniformly across the staff and that the data presented is accurate for that scenario. By explicitly calculating this, we understand the contribution of staffing levels to total donations, an essential factor in evaluating fundraising performance.

Calculating Total Labor Cost with Four Employees

The total labor cost at four employees is straightforward to compute if the average labor cost per employee is provided. By multiplying the average labor cost by four, we obtain the total labor cost. For example, if the average labor cost per employee is $Y, then total cost = 4 × $Y. This calculation considers the economies or diseconomies of scale that might be reflected in the average costs as staffing levels increase, which is crucial for cost-benefit analysis in fundraising operations.

Analyzing the Relationship Between Average Benefits and Average Costs

The decision rule for hiring is based on comparing the benefit per employee (such as donations generated) with the associated costs (labor costs). If the president hires as long as the average benefit exceeds the average cost, then the number of employees hired is maximized at the point where the average benefit just equals the average cost. This equilibrium point ensures that each additional employee adds more to the total donations than they cost, maximizing net benefits. Filling in the blanks accordingly, if the average benefit surpasses the average cost at a certain staffing level, this threshold determines the optimal number of employees. The net benefit is then calculated as total donations minus total labor costs at that optimal staffing level.

Marginal Benefit of the Second Employee

The marginal benefit of the second employee refers to the additional donations generated by hiring one more fundraiser beyond the initial staff. It can be calculated as the difference in total donations when moving from one employee to two, i.e., Total Donations with 2 employees minus total donations with 1 employee. This measure indicates the effectiveness of scaling up staffing and helps assess whether adding additional personnel yields sufficient incremental benefits.

Impact of Marginal Cost of the Fourth Employee

The marginal cost of employing the fourth fundraiser reflects the increase in total labor costs resulting from that additional hire. If the average labor cost rises with each new employee due to diminishing returns or increased per-employee costs, then the marginal cost at four employees will be higher than at three. This increased cost impacts the net benefit calculation and may lead to a decision to limit hiring once the marginal cost outweighs the marginal benefit.

Determining When the Net Benefit Is Maximum

The net benefit from fundraising staffing is maximized when the difference between total donations and total labor costs is at its peak. This occurs at the staffing level where the marginal benefit from hiring an additional employee equals the marginal cost. By analyzing the data, such as the changes in total donations and costs with each additional employee, we can identify this point. Typically, this is where the incremental gain in donations just balances the incremental increase in costs, ensuring the most efficient allocation of resources. Precise calculations based on the data will pinpoint the specific staffing number at which the net benefit peaks.

Conclusion

Optimizing fundraising staff levels requires balancing the additional donations generated by increasing staffing against the rising costs. By utilizing the data on total donations, average donations, and labor costs, decision-makers can identify the staffing level that maximizes net benefits. This analysis underscores the importance of marginal analysis in resource allocation, ensuring that fundraising efforts are both effective and economically sustainable.

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