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Bookbinders is considering a similar mail campaign in the Midwest where it has data for 50,000 customers. Such mailings typically promote several books. The allocated
Bookbinders is considering a similar mail campaign in the Midwest where it has data for 50,000 customers. Such mailings typically promote several books. The allocated cost of the mailing is $0.65/addressee (including postage) for the art book, and the book costs Bookbinders $15 to purchase and mail. The company allocates overhead to each book at 45 percent of cost. The selling price of the book is $31.95.
Which of the three options (use no model, use RFM model, or use Logit model) should be chosen and why?
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