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Return on investment to break even

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Pizza Hut is adding pasta salad to their menu and is trying to decide what price to charge; after it makes its decision, Domino's is going to decide whether to enter the pasta salad market as well. Use the decision tree to determine whether Pizza Hut should deter Domino's from entering the market for pasta salad. Which price should Pizza Hut charge? Assume that each firm must earn a 25% return on investment to break even. Explain Pizza Hut's decision process.

Reference no: EM132422646

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