Total market demand for a product or service is the total volume that would be bought by a defined consumer group in a defined geographic area in a defined time period in a defined marketing environment under a defined level of mix of industry marketing effort. The upper limit of market demand is called market potential.

In the chain ratio method of estimating demand, a base number is multiplied by a chain of adjusting percentages.

ZIVAGO sells HDTV and a recent marketing research survey found the following information:

Number of US households: 113 million

HDTV Ownership and internet access: 60% of the households.

Each household buys one HDTV. Average price: $ 500

30% of households are willing and able to buy HDTV

ZIVAGO wants to get 4% of the available market in the first year.

Use the chain ratio method to estimate

A. Market potential for HD TV

B Zivago sales volume in the first year