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Honda Motor Company is considering offering a $ 2 , 1 0 0 rebate on its minivan, lowering the vehicle's price from $ 2 9
Honda Motor Company is considering offering a $ rebate on its minivan, lowering the vehicle's price from $ to $ The marketing group estimates that this rebate will increase sales over the next year from to vehicles. Suppose Honda's profit margin with the rebate is $ per vehicle. If the change in sales is the only consequence of this decision, what are its costs and benefits? Is it a good idea? Hint: View this question in terms of incremental profits.
The cost of the rebate will be million. Round to one decimal place.
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