Marketing Expense Budget Timothy Donaghy has developed a unique formula for growing hair. His proprietary lotion, used regularly for 45 days, will grow hair in bald spots (with varying degrees of success). Timothy calls his lotion Hair-Again and is selling it via the telephone and Internet. His major form of marketing is through 15-minute infomercials and Internet advertising. Timothy sells each 16-ounce bottle of Hair-Again for $15 and pays a commission of 3 percent of sales to telephone operators who field the 1-800 phone calls from potential customers. Fixed marketing expenses for each quarter of the coming year include: Internet banner ads Telephone operator time Travel $7,600 5,000 3,000 In addition, early next year Timothy intends to film and show infomercials on television. He expects the cost to be $10,000 in quarters 1 and 2, and that the cost will rise to $24,000 in each of quarters 3 and 4. Timothy expects the following unit sales of Hair-Again: Quarter 1 5,000 Quarter 2 15,000 Quarter 3 40,000 Quarter 4 35,000