Reference no: EM13839646
VCI company is a video game distributor whose supplies video games to retailers such as BestBuy or Walmart. Currently it is considering developing and selling a new educational video game next year. This video game's suggested retail price (MSRP) is $20 and the retail margin is 40% of MSRP.
To obtain the legal distribution right of the game, VCI will need to pay a one-time developer's fee of $125,000. In addition, it's estimated that a sales promotion cost of $50,000 is needed to persuade retailers to carry the game. As of the production costs, each 1000 units of the game costs $4,000 for manufacturing, and $1,000 for labels, packages, and shipping.
1: From VCI's perspective, what is the price of each unit of the new game?
2. How much is VCI's gross profit on each of unit sold?
Use and submit an Excel file to complete this assignment. Show your calculations by using Excel's formula.
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