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Author Question: Heavy Duty Inc., a manufacturer of power tools, decides to offer a rebate of $100 on its 16-inch ... (Read 39 times)

rl

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Heavy Duty Inc., a manufacturer of power tools, decides to offer a rebate of $100 on its 16-inch mid-range chain saw, which currently has a retail price $470. Heavy Duty's marketers estimate that, as a result of the rebate, sales of this model will increase from 50,000 to 80,000 units next year. The profit margin for Heavy Duty before the rebate is $150. Based on the given information, is the decision to give the rebate a wise one?
◦ No, since costs are $3.5 million more than benefits.
◦ Yes, since the benefits are $0.2 million more than the costs.
◦ Yes, since the benefits are $1.5 million more than the costs.
◦ No, since costs are $5.0 million more than benefits.


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Marked as best answer by rl on Jul 9, 2019

mathjasmine

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rl

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Reply 2 on: Jul 9, 2019
Wow, this really help


lindahyatt42

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

 

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