### What is the estimated monthly contribution margin per cable

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##### Reference no: EM132234261

Question - CableVision has been approached by the City of Mirada to run its cable operations in 2019. After negotiating with key parties, CableVision has made the following agreements:

• It will offer Mirada residents a basic set of 25 cable television stations at a rate of \$33.49 per month.
• It will pay the city \$1,300,000 per year plus \$4.00 per cable subscriber per month to maintain the physical facilities.
• It will actually pay another company a monthly fixed fee of \$60,000 plus \$8.25 per cable subscriber per month to broadcast the 25 channels.

CableVision estimates that operating costs for billing, program news mailings, etc. will be \$110,000 per month plus 7% of monthly revenue.

CableVision has several questions about its monthly revenues, costs, and profits in 2019.

What is the estimated monthly contribution margin per cable subscriber for CableVision in 2019?

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