Rebeli Press chose to sell its books through traditional bookstores, at a price of $18 per book. Rebeli press also considered the alternative of selling its books on-line through a major on-line bookselling site, at $16 per book. If it chose to do this, the on-line site would do the printing and shipping, and would keep $12 from every sale. It would give Rebeli $4, from which Rebeli would have to pay royalties of $2 to the author.

A. For on-line sales, what would be the contribution margin per book, in dollars?

B. What number of on-line books did Rebeli Press need to sell in order to

“break even” and cover the other costs of $43,000?

C. Compare the number of books it would have to sell using this on-line site to the number it would have to sell to bookstores when its contribution margin per book is $8.