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l. The group president for Household Products Corporations was reviewing price and promotion alternatives for two products: Green-Mist and Green-Rinse. Both products were designed
l. The group president for Household Products Corporations was reviewing price and promotion alternatives for two products: Green-Mist and Green-Rinse. Both products were designed to keep the bathroom odor free---Green-Mist being an aerosol deodorant and Green-Rinse being an in-tank toilet rinse. The price and promotion alternatives recommended for the two products by their respective brand managers included the possibility of using additional promotion or a price reduction to stimulate sales volume. A volume, price, and cost summary for the two products follows: Green-Mist Green-Rinse Unit Price $6.00 $4.00 Unit Variable Costs $3.50 $0.50 Unit Contribution $2.50 $3.50 Unit Volume 1,000,000 units 1,500,000 units Both brand managers included a recommendation to either reduce price by 10 percent or invest an incremental $300,000 in advertising a. What absolute increase in unit sales and dollar sales will be necessary to recoup the incremental increase in advertising expenditures for Green-Mist? For Green-Rinse?
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