Question: Consider a retailer considering a 3 3 - percent - off sale on blenders currently priced at $ 5 4 . The retailer pays $
Consider a retailer considering a percentoff sale on blenders currently priced at $ The retailer pays $ per blender from the manufacturer.
a What is the initial contribution margin?
b What is the proposed sale price and the percent change in price captured per unit sold?
c What is the volume hurdle that must be achieved for the sale on blenders to improve profits through the sale of blenders alone?
d Suppose that instead of having this sale, a young pricing expert suggested that the price of Elenders be increased to $ What would be the allowable loss in sales of blenders that would still leave the retailer in a more profitable position?
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