BU362 Lecture Notes - Lecture 4: Inventory Turnover, Fixed Cost, Personal Selling
Document Summary
Change in fc ---------- change iin contribution ---------------- change in revenues (recover) (allocate average contribution margin) average contribution margin = fixed costs / revenues. Change in revenues = change in fixed costs / average contributin margin. Be: change in revenues = change in total variable cost + change in total fixed cost. Change in revenues change in total variable cost = change in total fixed cost. 1 = total fixed cost / (change in revenues total variable cost) Change in revenues = change tfc / : evaluating advertising effectiveness. Recipients ------------------- inquiries ---------------------- qualified leads ---------------------- closes (personal selling) (telemarketers: 700 recipients ------------ 206 inquiries ----------------- 105 qualified leads ------------ 28 closes, +4350 x 1/4 x . 5 (gm: 21. 4%) Campaign b better as it saves a lot of costs, though the conversion rates are essentially the same: 1000 r, +1285+115+990.
