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A). Local smartphone company LuckyPhones775 recently introduced a new model of phones and the sales are 15,000 phones/month. The manufacture costs are $600/phone, and MSRP
A). Local smartphone company LuckyPhones775 recently introduced a new model of phones and the sales are 15,000 phones/month. The manufacture costs are $600/phone, and MSRP is $850/phone. LuckyPhones775 ran the promotion experiment by lowering price by $100/phone, as a result sales increased by 40%. In addition LuckyPhones775 does YouTube advertising and spends $4,000/month on YouTube. Marketing department estimates that increasing YouTube spending by $2,000/month would increase sales by 400 phones/month. Given that the company is a startup it can not spend on YouTube more than $10,000/month. 1. Calculate the price of the phones and YouTube expenditures that would result in maximum profit
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