The following appeared in a memo from a budget planner for the city of Grandview.
"Our citizens are well aware of the fact that while the Grandview Symphony Orchestra was struggling to succeed, our city government promised annual funding to help support its programs. Last year, however, private contributions to the symphony increased by 200 percent, and attendance at the symphony's concerts-in-the-park series doubled. The symphony has also announced an increase in ticket prices for next year. Such developments indicate that the symphony can now succeed without funding from city government and we can eliminate that expense from next year's budget. Therefore, we recommend that the city of Grandview eliminate its funding for the Grandview Symphony from next year's budget. By doing so, we can prevent a city budget deficit without threatening the success of the symphony."
Write a response in which you discuss what questions would need to be answered in order to decide whether the recommendation is likely to have the predicted result. Be sure to explain how the answers to these questions would help to evaluate the recommendation.
In this memo, the budget planner for the city of Grandview recommends that the city of Grandview eliminate its funding for the Grandview Symphony because private donations and attendance at the symphony’s concert have doubled last year and the symphony announced its plan to increase ticket prices next year. While declining the funding form the city can help the city government with their budget to some extent, whether the author’s prediction that the symphony will be successful is reasonable hinges on the answers to the following questions.
To begin with, the budget planner mentions that private contributions have doubled, which could be anticipatory of a supposition that this revenue would be able to fill the absence of the city's funding; however, while a doubling in contributions is quantitative progress, we are unaware of the original amount of contributions, and, therefore, cannot be certain that the current amount will be able to fill the gap. It is possible that the proportion in the expenses of the symphony which comes from private funding account only for a small part, most of which come from the city government. In this case, even with a 200-percent increase, the symphony could still unable to survive next year without the help of the city. Furthermore, if the symphony does not have enough money to pay off all of their new expenses with the private contributions, the budget planner’s proposition regarding the elimination of city funds to the symphony would be rendered questionable, as the symphony could end up struggling to make ends meet. However, if it turns out that the doubling in personal donations could cover the majority of the symphony’s expenses, the author’s prediction will be strengthened.
Similarly, the budget planner offers the doubling in the attendance at the symphony’s concerts series as evidence for the discontinuation in the funding from the city. Here, we need to ask how much profit these concert series bring in for the orchestra. These could simply be low-cost events to spread recognition, and the profit reaped by these events could be minimal. Furthermore, the budget planner only mentions this concerts-in-the-park series, can we be certain that attendance numbers will be similar for other concert series in the future? If this event is special in any certain way, or attendants have more leisure time to participate in such events during a fixed period of the year, leading to increased attendance, while other events hosted by the symphony, in comparison, are lackluster or scheduled at inconvenient times during the year, then audience numbers would not be likely to remain consistent. If this were to be the case, the symphony could end up losing money.
Furthermore, another question that needs to be put forward revolves around the efficacy of the increase in ticket prices. To be more specific, will the symphony’s targeted audiences accept the new price? The reason why the symphony accepted the funding form both the city government and individual is probably that the purchasing power of local residents is limited. Thus, if the higher price frightens away the potential audience and makes the symphony lose even more money, the author’s proposal would be challenged. In addition, will the higher price cover the cost of the symphony? It is quite possible that without the help from the city government, some operation costs would increase in the future. Therefore, if the higher price still cannot cover the symphony’s daily expenditure, the author’s conclusion could still be invalidated.
Moreover, even if private contributions are significant, the orchestra’s ability to gain audience members have increased, and the higher price can contribute to a higher revenue, we still need to know whether the symphony could remain its success without the funding from the city. Perhaps the symphony is very successful and can provide for itself, but we still can't be certain that cutting off city funding is a feasible plan of action, because the city’s funding may be providing the symphony with a necessary endorsement, without which the symphony may lose its private contributions and reputations among audiences. If this is the case, then the budget planner's recommendation would be weakened.
Finally, the author states that with the symphony providing for itself, the city can solve its budget deficit. Yet, it remains unclear whether eliminating the funding for the symphony alone is sufficient for preventing a budget deficit. The budget deficit of a city government may come from a variety of aspects: infrastructure, education, public service, etc., and funding for a symphony could account for a minor part. Therefore, if, comparing to the budget that will be spent on other areas, funding for the Grandview Symphony Orchestra is just slight, the author’s wish to prevent the budget deficit for the city would turn out to be too optimistic. At the same time, if the city is planning on other major projects demanding additional budgetary commitment, we can reasonably expect an even higher deficit despite cutting funding to the symphony. On the other hand, if there is concrete evidence showing the magnitude of possible deficit is smaller than the funding for the city symphony, the author's prediction will be strengthened.'
In conclusion, while I sympathize with the author’s intention to help solve the city’s budget deficit and remain the success of the symphony, whether they should decline future funding from the city is subject to more consideration. Only after answering the question mentioned above can we fully evaluate the author’s prediction and come to a more logical conclusion.