Question
Target is considering a campaign to increase sales for one of its products. Market researchers last year suggested the company could sell 7,000 more units
Target is considering a campaign to increase sales for one of its products. Market researchers last year suggested the company could sell 7,000 more units of this product
the cost of this research was $17,500.
The cost of the advertising campaign would be $59,400.
The product's contribution margin is $13.00 per unit
additional annual fixed costs would be $12,000.
The increased sales are expected to last for 6 years.
Assuming a discount rate of 7%, what is the net present value of this investment?
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Managerial Accounting
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
13th Edition
978-0073379616, 73379611, 978-0697789938
