Pomona Equipment Company is estimating Market Sales Potential (Units & Dollars) in 2023 related to special tools, and conducting Sales Forecast (Units & Dollars) in 2023 for its newly developed special tool. The average unit of this special tool in the market is expected to sell at $5. There are three groups of buyers that Pomona Equipment Company is paying attention to:

Group 1: Southern California Male population aged between 18~24 years; 30% of this population group is expected to purchase this special tool; Average consumption per person per year is 3 units.

Group 2: Southern California Male population aged between 25~44 years; 20% of this population group is expected to purchase this special tool; Average consumption per person per year is 2 units.

Group 3: Southern California Female population aged between 18~24 years; 10% of this population group is expected to purchase this special tool; Average consumption per person per year is 1 unit.

• Pomona Equipment Companys Info: Its own target market: 40% of the potential buyers described above; Communication/Distribution coverage: 50% of the potential buyers described above; Special tool price: $5/unit.

Sex and Selected Age groups	2000		2010		Change, 2000 to 2010
	Number	Percent	Number	Percent	Number	Percent
Total Population	2,500,000	100.00%	3,000,000	100.00%	500,000	20%
Sex
Men	1,250,000	50.00%	1,500,000	50.00%	250,000	20.00%
Women	1,250,000	50.00%	1,500,000	50.00%	250,000	20.00%
Selected Age Groups
Under 5 years	100,000	4%	110,000	4%	10,000	10%
5 to 17 years	500,000	20%	550,000	17%	50,000	10%
18 to 24 years	300,000	12%	360,000	12%	60,000	20%
25 to 44 years	800,000	32%	960,000	32%	160,000	20%
45 to 64 years	400,000	16%	500,000	17%	100,000	25%
65 years and over	400,000	16%	520,000	17%	120,000	30%

3.1) Estimate Market Sales Potential (Units and Dollars) related to this special tool in 2023.

3.2) Estimate Pomona Equipment Companys sales forecast (Units and Dollars) in 2023 related to its special tool.

3.3) For Pomona Equipment Company, the total variable cost (= cost of goods sold) of its special tool is $2 per unit (It will stay unchanged). Compute the unit contribution ($/unit) and contribution margin ratio (%) of this tool.

3.4) Estimate the total contribution ($, total gross margin) for Pomona Equipment Company related to this tool.

3.5) Pomona Equipment Company will spend $60,000 for all marketing expenses, and $40,000 for administrative costs. The total R&D cost related to this tool is $200,000. Would you launch this tool in 2023? Why?