What increase in dollar sales will be necessary to recoup

Assignment Help Other Subject

Reference no: EM13197120

The group product manager for ointments at American Therapeutic Corporation was reviewing price and promotion alternatives for two products: Rash- Away and Red-Away. Both products were designed to reduce skin irritation, but Red-Away was primarily a cosmetic treatment whereas Rash-Away also included a compound that eliminated the rash. The price and promotion alternatives recommended for the two products by their respective brand managers included the possibility of using additional promotion or a price reduction to stimulate sales volume. A volume, price, and cost summary for the two products follows:

Rash-Away Red-Away

Unit price $2.00 $1.00
Unit variable costs 1.40 0.25
Unit contribution $0.60 $0.75
Unit volume 1,000,000 units 1,500,000 units

Both brand managers included a recommendation to either reduce price by 10 percent or invest an incremental $150,000 in advertising.

What absolute increase in unit sales and dollar sales will be necessary to recoup the incremental increase in advertising expenditures for Rash-Away? For Red-Away?

Reference no: EM13197120

Questions Cloud

How to describe a fictitious organization : Prepare an employee usage policy for your organization's information systems and assets. Your policy should include, but not necessarily be limited to, email and web usage. Please include a basic description of the organization as an attachment.

State measurement of the concentration of fe : Measurement of the concentration of Fe3+ ions in a saturatedsolution of iron(III) chloride was found to be 0.35M. Calculate the Ksp of iron(III) chloride

How several nonrooom departments would use rooms forcast : The rooms forecast is a tool for managers throughout the hotel; it is not for the front office alone. List and discuss how several other nonrooom departments(housekeeping, food and beverage, ect.) would use the rooms forcast.

Define energy for the human : To provide energy for the human, the O2 is reduced to H2O duing food oxidation by the following reaction: Recall that 1 ampere is equal to a charge of 1 coulomb per second flowing past a point in a circuit.

What increase in dollar sales will be necessary to recoup : The price and promotion alternatives recommended for the two products by their respective brand managers included the possibility of using additional promotion or a price reduction to stimulate sales volume. A volume, price, and cost summary for th..

Use experiential marketing tools for the brands : Discuss how you can use experiential marketing tools for the brands (especially for FreshX). What tools will you use to measure outcomes from such events?

What is the height of the tree : To find the height of a tall tree, a surveyor moves 140 feet away from the base of the tree and then, with a transit 4 feet tall, measures the angle of elevation to the top of the tree to be 53°. What is the height of the tree? Round your answer t..

Find the average distance to the x-axis for points : find the average distance to the x-axis for points in the region bounded by the x-axis and the graph of y = x - x^2.

Estimate the largest area that can be fenced : a farmer has 400 feet of fence with which to fence a rectangular plot of land. the plot lies along a river so that only three sides need to be fenced. estimate the largest area that can be fenced.

User Account

All Pages