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What are its benefits and costs

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Question - Honda Motor Company is considering offering a $1,900 rebate on its minivan, lowering the vehicle's price from $28,000 to $26,100. The marketing group estimates that this rebate will increase sales over the next year from 50,000 to 64,000 vehicles. Suppose Honda's profit margin with the rebate is $5,600 per vehicle. If the change in sales is the only consequence of this decision, what are its benefits and costs? Is it a good idea?

Reference no: EM133105580

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