Calculate the Net Marketing Contribution of a Product If the Market

question 12

Multiple Choice

Calculate the net marketing contribution of a product if the market demand for the product is 4 million units annually,and the product captures 10 percent of this demand with a price of $50 per unit and a cost of $40 per unit.The total of marketing and sales expenses is $2.5 million.

• A)$3 million
• B)$2.5 million
• C)$2 million
• D)$1.5 million
• E)$1 million

---

Definitions:

Tex-Mex Restaurant

A type of dining establishment that serves a fusion cuisine of Texan and Mexican origins, characterized by its hearty, flavorful dishes.

Local Phone Company

A telecommunications provider that offers services within a specific geographic area, typically handling local calls and access.

Monopolistic Competitor

A firm that operates in a market structure characterized by many competitors offering products or services that are similar but not identical, allowing for some degree of market power.

Long Run

A period in which all factors of production and costs are variable, allowing for full adjustment to changes.