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Can they also help me answer: Industry demand is expected to increase to 9 0 0 , 0 0 0 units next year. Schmidt is

Can they also help me answer: Industry demand is expected to increase to 900,000 units next year. Schmidt is considering
raising his advertising budget to 1 million.
a. If the advertising budget is raised, how many units must Hohner sell to break even?
b. How many units must Hohner sell to achieve the same profit (in terms of Euro amount)
next year as it earned this year?
c. What must Hohners market share be next year for its profit (in terms of Euro amount) to
be the same as this year?
6. After some reflection, Schmidt decided not to increase Hohners advertising budget. With
industry demand expected to increase to 900,000 units next year, Schmidt thought he would
give retailers an incentive to promote the Marine Band by raising their margins from 33% to
40%. The margin increase would be accomplished by lowering the manufacturers price of the
product to retailers. Distributor margins would remain at 15%.
a. If retailer margins are raised to 40% next year, how many Marine Bands must Hohner sell
to break even?
b. How many units must Hohner sell to achieve the same profit (in terms of Euro amount)
next year as it earned this year?
c. What must Hohners market share be for its profit (in terms of Euro amount) to remain at
this years level?

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