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Pisa Pizza, a seller of frozen pizza, is considering introducing a healthier version of its pizza that will be low in cholesterol and contain no

Pisa Pizza, a seller of frozen pizza, is considering introducing a healthier version of its
pizza that will be low in cholesterol and contain no trans fats. The firm expects that
sales of the new pizza will be $15 million per year. While many of these sales will be
to new customers, Pisa Pizza estimates that 34% will come from customers who
switch to the new, healthier pizza instead of buying the original version.
a. Assume customers will spend the same amount on either version. What level of
incremental sales is associated with introducing the new pizza?
b. Suppose that 40% of the customers who will switch from Pisa Pizza's original pizza
to its healthier pizza will switch to another brand if Pisa Pizza does not introduce a
healthier pizza. What level of incremental sales is associated with introducing the new
pizza in this case?
a. Assume customers will spend the same amount on either version. What level of
incremental sales is associated with introducing the new pizza?
The incremental sales associated with introducing the new pizza will be $ million.
(Round to two decimal places.)
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