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Honda Motor Company is considering offering a $ 2 comma 000$2,000 rebate on its minivan, lowering the vehicle's price from $ 30 comma 000$30,000 to

Honda Motor Company is considering offering a

$ 2 comma 000$2,000

rebate on its minivan, lowering the vehicle's price from

$ 30 comma 000$30,000

to

$ 28 comma 000$28,000.

The marketing group estimates that this rebate will increase sales over the next year from

40 comma 00040,000

to

55 comma 00055,000

vehicles. Suppose Honda's profit margin with the rebate is

$ 6 comma 000$6,000

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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