Instructions: Please read problem carefully. Write the answers on the answer sheets provided. Make sure that you clearly show all of the work that went in to solving the problem. Partial credit will be awarded on each part of the problem, so make sure that you attempt each part. You are the marketing manager for Clean Cut, a manufacturer of shaving products. Your company produces several lines of disposable razors for men and women. The company markets several lines of razors across a number of retail partners, such as CVS Drugstore. It is currently deciding whether or not to sell its higher end disposable model (the Clozer) via direct selling through the company's website. In evaluating this idea, you are to consider the following set of information: Clozer factory labor-$.20/unit Clozer raw materials $.50/unit Clozer administrative overhead-$50,000 Clozer advertising and in-store promotion for retailer sales only - $100,000 Packaging $.15/unit Retailer's margin -10% Shipping and additional packaging (for web sales only) = $.30/unit Website design and maintenance for website sales only Advertising for website sales only - $60,000 $45,000 a. What is the contribution per unit for the Clozer if sold retail for $10.00- per unit? Questions: b. What is the unit break-even for the Clozer if sold only via direct sales at $9.99 per unit? c. Using the above pricing information, what is the difference in net contribution if the company sells 1,000,000 units at retail or if they sell 1,000,000 units via direct website sales? d. The use of the direct sales website is expected to cannibalize retailer sales volume by 30,000 units. Assuming an initial retailer sales projection (that is, sales without cannibalization) of 200,000 units and expected total direct sales of 70,000 units (30,000 cannibalized volume and 40,000 incremental volume), what is the net financial impact of including direct website sales as part of Clean Cut's distribution strategy? 1