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Find: cost per unit, contribution margin and variable costs Please show calculations as well, thank you so much. IN BUSINESS WOULD YOU PAY $800 FOR
Find: cost per unit, contribution margin and variable costs
Please show calculations as well, thank you so much.
IN BUSINESS WOULD YOU PAY $800 FOR A PAIR OF SNEAKERS? Astrid Stawiarz/Goodman's Men's Store/Getty Images Some companies rely on sales volume to drive profits whereas others rely on scarcity to increase margins and profits. Buscemi sneakers burst on to the market for $760 a pair and soon climbed to $865 a pair. The company purposely limits production to drive up its prices. It initially produced a batch of 600 pairs of sneakers that sold out in days. Then the company released 4,000 additional pairs that were sold out by the time pop star Justin Bieber posted a picture of his gold-colored Buscemis on Instagram. Its next step was to release 8,000 more pairs to about 50 stores. Although Buscemi could almost certainly increase production and unit sales, the company chooses to limit availability to add to the mystique (and price) of the brand. Source: Hannah Karp. "An $800 Sneaker Plays Hard to Get," The Wall Street Journal, July 28, 2014. pp. B1 and B7. IN BUSINESS WOULD YOU PAY $800 FOR A PAIR OF SNEAKERS? Astrid Stawiarz/Goodman's Men's Store/Getty Images Some companies rely on sales volume to drive profits whereas others rely on scarcity to increase margins and profits. Buscemi sneakers burst on to the market for $760 a pair and soon climbed to $865 a pair. The company purposely limits production to drive up its prices. It initially produced a batch of 600 pairs of sneakers that sold out in days. Then the company released 4,000 additional pairs that were sold out by the time pop star Justin Bieber posted a picture of his gold-colored Buscemis on Instagram. Its next step was to release 8,000 more pairs to about 50 stores. Although Buscemi could almost certainly increase production and unit sales, the company chooses to limit availability to add to the mystique (and price) of the brand. Source: Hannah Karp. "An $800 Sneaker Plays Hard to Get," The Wall Street Journal, July 28, 2014. pp. B1 and B7Step by Step Solution
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