Question: What is the process to solve this problem? Baldwin invests $2,000,000 in a TQM Channel Support Systems initiative will at a minimum increase demand for

What is the process to solve this problem?

  1. Baldwin invests $2,000,000 in a TQM Channel Support Systems initiative will at a minimum increase demand for your products 3.0% in this and future rounds. Last years sales were $103,900,000. Assuming similar sales next year, the 3.0% increase in demand will provide $4,911,367 of additional revenue. With the overall contribution margin of 30.4%, after direct costs, this revenue will add $1,679,688 to the bottom line. For simplicity, assume that the demand increase and margins will remain at last years levels. How long will it take to achieve payback on the initial $2,000,000 TQM investment? Round to the nearest month.
  1. 10 months
  2. TQM investment will not have a significant financial impact
  3. 14 months
  4. 5 months

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