Is it more profitable to sell your product for 48or12? This is a difficult question for many movie studio executives. Consider a movie that cost 60 million to produce and required another 40 million to promote. After its theater release, the studio must determine whether to sell DVDs directly to the public at a wholesale price of about 12 per DVD or to sell to video rental store distributors for about48 per DVD. The distributors will then sell to about 12000video rental stores in the United States. Assume that the variable cost to produce and ship

1 DVD is 31. Suppose each video rental store would purchase 16 DVDs of this movie. How many DVDs would need to be sold directly to customers to make direct sales a more profitable option than sales to video store distributors? 2. How does the cost of producing and promoting the movie affect this decision? 3. the company elected to sell directly to consumers, and it sold 33 million copies at an average price of 12.30 per DVD. How many DVDs would each video rental store have to purchase to provide as much profit as the company received from direct sales? Assume that would receive 48 per DVD from the distributors.

Requirement 1. Suppose each video rental store would purchase DVDs of this movie. How many DVDs would need to be sold directly to customers to make direct sales a more profitable option than sales to video store distributors? Select the formula needed, and then enter the amounts to calculate how many DVDs the company would need to sell directly to customers to make direct sales a more profitable option than sales to video store distributors. (Abbreviations used: CM = contribution margin, Min. # - Minimum Number. Round your answer up to the nearest whole number.)

	/		=	Min. # of DVD sales to direct customers
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