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All stores are similar in size, carry similar products, and operate in similar neighborhoods. Store 1 was established first and was built at a lower

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All stores are similar in size, carry similar products, and operate in similar neighborhoods. Store 1 was established first and was built at a lower cost than were Stores 2 and 3. This lower cost results in less depreciation expense for Store 1. Store 2 Bithws polligy of miniming both costs and sales prices. Store 3 follows a policy of providing extensive customer service and charges signuy higher prices than the other two stores. The marketing manager of Drexel-Hall is considering two alternative advertising strategies, each of which would cost $15.000 per month. One strategy is to advertise the name Drexel-Hall, which is expected to increase the monthly sales at all stores by 5 percent. The other strategy is to emphasize the low prices available at Store 2, which is expected to increase monthly soles at Store 2 by $150,000, but to reduce sales by $30,000 per month ot Stores 1 and 3 . Determine the expected effect of each strategy on the company's overall income from operations. hborhoods. Store 1 was established first and depreciation expense for Store 1. Store 2 plicy of providing extensive customer service ing strategies, each of which would cost is expected to increase the monthly sales at all ble at Store 2, which is expected to increase onth at Stores 1 and 3. tome from operations

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