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Joe from Joe's Mowers wants to make some changes to his business. He has asked each of his department managers (Production, Marketing and Sales) to
Joe from Joe's Mowers wants to make some changes to his business. He has asked each of his department managers (Production, Marketing and Sales) to submit a plan for growth to you the General Manager. Currently Joe is selling 500 lawn mowers a month at $250 each. His variable cost per lawnmower is $160 each. His fixed cost per month are $ 28,000. The Sales Department is also considering three different alternatives. A. Offer a commission of $5 per mower to the sales force. They believe that this will increase sales by at least 24 units. B. Offer a commission to the sales force of $15 per mower. They believe that this will increase sales by at least 35 units per month. C. Offer a commission of $25 per mower and increase the cost of the mower by $10. Even with the higher price, they believe it would increase mower sales by at least 40 mowers per month. Question 8. How much money will Mark make in each of the separate situations
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