Question

how would a change in strategy such as shifting advertising emphasis to high contributed margin products...

how would a change in strategy such as shifting advertising emphasis to high contributed margin products affect your budget?

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

If the advertisement is shifted from products having lower contribution margin to the products having higher contribution margin, the budget would be favorable; because such thing increases operating profit (since contribution margin increases) and decreases the break-even point.

Break-even point = Total fixed cost / Contribution per unit

Although advertisement cost increases the fixed cost but it gives much higher return on contribution margin; therefore, the break-even point should be down.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
1. How can strategy affect structure change? 2. How can strategy affect culture change? 3. What...
1. How can strategy affect structure change? 2. How can strategy affect culture change? 3. What is the role of leadership in change?
Berwick Ltd has always had a strategy of cost leadership; that is, selling high volumes of...
Berwick Ltd has always had a strategy of cost leadership; that is, selling high volumes of low-cost products at a competitive price. During a recent sales slump, Berwick Ltd saw its sales revenues drop dramatically and has decided to move strategically to a product differentiation strategy; that is, to sell lower volumes of high-quality products at a premium price. Discuss in your workshop group: What are the implications of this strategy change in terms of the usefulness of historical sales...
An employer oers his or her employee the option of shifting x units of income from...
An employer oers his or her employee the option of shifting x units of income from next year to this year. That is, the option is to reduce income next year by x units and increase income this year by x units. (a) Would the employee take this option? Use a life-cycle diagram to show why or why not (hint: how is the budget constraint affected, and would a higher indiference curve be attained?) (b) Determine, again using a diagram,...
1.For which of the following products would a large manufacturer most likely use a push strategy?...
1.For which of the following products would a large manufacturer most likely use a push strategy? a. breakfast cereals b. minicomputers c. dishwashing detergent d. women's hosiery 2.In which stage of the product life cycle would pioneering advertising be most likely to appear? a. growth b. maturity c. culmination d. introductory e. decline 3The ______ of an ad is defined as all the written or spoken material in it. a. layout b. copy c. feedback d. message
2) Your car wash company is advertising on local radio, on local television, and via direct...
2) Your car wash company is advertising on local radio, on local television, and via direct mail. You believe that a radio campaign raises your gross profit by $100, a television campaign raises it by $200, and a direct mail campaign raises it by $50. The cost of a radio campaign is $50, the cost of a television campaign is $75, and the cost of a direct mail campaign is $50. a. If you cannot change your total advertising budget,...
The Sea Wharf Restaurant would like to determine the best way to allocate a monthly advertising...
The Sea Wharf Restaurant would like to determine the best way to allocate a monthly advertising budget of $1,000 between newspaper advertising and radio advertising. Management decided that at least 25% of the budget must be spent on each type of media and that the amount of money spent on local newspaper advertising must be at least thrice the amount spent on radio advertising. A marketing consultant developed an index that measures audience exposure per dollar of advertising on a...
The Sea Wharf Restaurant would like to determine the best way to allocate a monthly advertising...
The Sea Wharf Restaurant would like to determine the best way to allocate a monthly advertising budget of $1,000 between newspaper advertising and radio advertising. Management decided that at least 25% of the budget must be spent on each type of media and that the amount of money spent on local newspaper advertising must be at least two and a half times the amount spent on radio advertising. A marketing consultant developed an index that measures audience exposure per dollar...
A company is planning how to use its $225,000 advertising budget to increase its products sales....
A company is planning how to use its $225,000 advertising budget to increase its products sales. The company is considering advertising in newspapers and on the Internet. The more the company uses a particular medium, the less effective is each additional ad. The table below shows the number of new customers reached by each ad. Each newspaper ad costs $2,000, and each Internet ad costs $5,000. At most, 45 newspaper ads and 30 Internet ads can be placed. Number of...
Changes in consumer demands for household cleaning products have been caused by the coronavirus pandemic. How...
Changes in consumer demands for household cleaning products have been caused by the coronavirus pandemic. How would the demand curve for these products change as a result of the pandemic? How would the supply curve shift in response to change in demand? What would happen if new cleaning firms entered the market. How will this affect the demand and supply curve? How does reducing the number of brands of cleaning products in a firm result in greater efficiency?
Suppose you’re a Wisconsin farmer who sells corn to consumers in Mexico. How would the change...
Suppose you’re a Wisconsin farmer who sells corn to consumers in Mexico. How would the change in the exchange rate in 2015 probably affect your sales of corn to Mexico?
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT