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23 Nov 2019
Honda Motor Company is considering offering a $2000 rebate on its minivan, lowering
the vehicle's price from $30,000 to $28,000. The marketing group estimates that this
rebate will increase sales over the next year from 40,000 to 55,000 vehicles. Suppose
Honda's profit margin with the rebate is $6000 per vehicle. If the change in sales is the only consequence of this decision, what are its costs and benefits? Is it a good idea?
Honda Motor Company is considering offering a $2000 rebate on its minivan, lowering
the vehicle's price from $30,000 to $28,000. The marketing group estimates that this
rebate will increase sales over the next year from 40,000 to 55,000 vehicles. Suppose
Honda's profit margin with the rebate is $6000 per vehicle. If the change in sales is the only consequence of this decision, what are its costs and benefits? Is it a good idea?
oldsheldonLv5
29 Apr 2024
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Irving HeathcoteLv2
3 Nov 2019
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