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A retailer sells a particular brand of paper towels in four-packs and eight-packs. If the retailer is making $1 in profit on the four-pack, a
A retailer sells a particular brand of paper towels in four-packs and eight-packs. If the retailer is making $1 in profit on the four-pack, a baseline profit for the eight-pack should be about $2. What if the retiler knew that if it sold people more paper towels people would actually use more paper towels. Assume people buy the eight-pack and use 20% more than if they just had the four-pack. How much could I lower my margin on the large-size pack with 8 rolls and still break even relative to what I would be making on the small-size pack? $.24 per roll $.23 per roll $.22 per roll $.21 per roll
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