Comment:Complete Problem 6-9 "IDP Pharmaceutical Co."

assignment using an Excel spreadsheet to show your computations to support your recommendation. Be sure to include all formulas supporting the calculation and showing your computations.

6-9: Marketing Plan ' 4 Robin Jensen, manager of market planning for Viral Products of the [DP Pharmaceutical Co, is ' responsible for advertising a class of products. She has designed a three-year marketing plan to increase the market share of her product class. Her plan involves a major increase in magazine adver~ rising. She has met with anadver'tising agency that has designed a three-year ad campaign involving. 12 separate ads that build on a common theme. Each ad will run in three consecutive monthly medi- cal magazines and then be followed by the next ad in the sequence. Up to ve medical journals vvill carry the ad campaign. Direct mail campaigns and direct sales promotional material will be designed 264 Chapter 6' to follow the theme of the ad currently appearing. The accompanying table summarizes the cost of, the campaign: Number of- ads- _ Numb er of magazines 5 5 4 ii. Cost per ad. $ 6,000 $ 6,200 $ 6,500 Advertising cost $120,000 $124,000 $104,000 $348439 3 The rm's normal policy is to budget each year as a separate entity without carrying forwar: unspent monies. Jensen is requesting that, instead of just approving the budget for next year (Year above), the rm approve. and budget the entire threeyear project. This would allow her to move for: ward with her campaign and give her the freedom to apply any unspent funds in one year to the ne-, year or to use them in another part of the campaign. She argues that the ad campaign is an integra _-, project stretching over three years and should be either approved or rejected in its entirety. ' Required: Critically evaluate Jensen's requestand make a recommendation as to whether a three-year bud should be approved per her proposal. (Assume that the advertising campaign is expected to 139332,. protable project.)