Question
Valentine Company sells toys for $25 each. Variable cost per toy is $10. The company is planning on renting a promotion counter at Mexico convention
Valentine Company sells toys for $25 each. Variable cost per toy is $10. The company is planning on renting a promotion counter at Mexico convention center for both display and selling purposes of their toy. The convention coordinator allows four options for all participant companies. They are: 1. paying a fixed promotion counter rent $5,000, or 2. paying an $4,000 fee plus 10% of revenue made at the convention, or 3. paying 20% of revenue made at the convention 4. paying an advertising cost $2,000 and $1,000 for insurance fee
Question: Assuming sales are expected to be 800 toys, which option should Valentine Company choose?
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