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What conditions would justify the assumption of a constant contribution margin (Rev - Vari Cost) per customer? Do you think those conditions are likely to
What conditions would justify the assumption of a constant contribution margin (Rev - Vari Cost) per customer? Do you think those conditions are likely to hold here? To support your conclusions, do a scatter plot of the sample data, and then use the sample data to run a regression of purchase costs (dependent variable) on purchase revenues (independent variable). [Hint: What is the meaning of the intercept term of your regression results?]
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