Question
Test Your Understanding: : A company typically sells 100,000 units at $10 per unit. It runs a promotion that discounts each unit by $4 per
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Test Your Understanding: : A company typically sells 100,000 units at $10 per unit. It runs a promotion that discounts each unit by $4 per unit. To promote the discount, the company pays a flat fee of $25,000. The company sells 75,000 additional units in incremental sales. The company tells its marketing team to kill any promotion that has <10% MROI.
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Should the company proceed with this promotion and discount?
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Why or why not?
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Test Your Understanding: : A company typically sells 100,000 units at $10 per unit. It runs a promotion that discounts each unit by $4 per unit. To promote the discount, the company pays a flat fee of $25,000. The company sells 75,000 additional units in incremental sales. The company tells its marketing team to kill any promotion that has <10% MROI.
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Should the company proceed with this promotion and discount?
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Why or why not?
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Financial Markets and Institutions
Authors: Anthony Saunders, Marcia Cornett
6th edition
9780077641849, 77861663, 77641841, 978-0077861667
