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P3-1 (similar to) Question Help Honda Motor Company is considering offering a $3,000 rebate on its minivan, lowering the vehicle's price from $21,000 to $18,000.
P3-1 (similar to) Question Help Honda Motor Company is considering offering a $3,000 rebate on its minivan, lowering the vehicle's price from $21,000 to $18,000. The marketing group estimates that this rebate will increase sales over the next year from 38,000 to 57,000 vehicles. Suppose Honda's profit margin with the rebate is 56,200 per vehicle. If the change in sales is the only consequence of this decision, what are its benefits and costs? Is it a good idea? The benefits are 5 million (Round to one decimal place.)
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