1). Complete the table. For the Percent Contribution Margin, use (P-MC)/P. 2) Y

1). Complete the table. For the Percent Contribution Margin, use (P-MC)/P.
2) You are serving as the chair for your community’s annual wellness campaign. A key event is
the annual Walk 3k, Run 10k, Ride 20k event. The event is staged entirely by volunteers and the
goal is to attract community wide awareness of getting active as a key step to wellness. In other
words, the goal is not to raise money, but to prompt awareness. As the chair you set a financial
goal to breakeven on the one and only cost of the event, a fitness bag with the community seal
and the event moto, “I AM ON THE RIGHT TRACK!
The cost of the bags, which must be ordered in batches of 100, are:
a) If this was a profit-making activity, at the entry fee of $20, what would be the
profit maximizing quantity of participants/bags.
b) Use the information in the table to determine the exact breakeven quantity of
participants/bags for the entry fee of $20. Use the formula Qb = F/(P – AVC).
3) You make a lightweight compact foldable windbreaker. Your brand Desert Wind Jackets is
well established in the southwest. In a drive to broaden your appeal and open new markets you
have re-branded under the simple logo DWJ. The strength of your brand, loved by your
customers in the southwest, means you have a price elasticity on demand of -2.76. Market
research indicates that in the upper west, where there is some knowledge of your brand the price
elasticity of demand is -3.50. In New England where you are least known it is estimated that the
price elasticity of demand will be quite high, -5.76. Your marginal cost per jacket is $198.33.
a) What price will you charge in your southwestern region?
b) What price will you charge in your upper western region?
c) What price will you charge in your New England region