A retail store sells a popular cosmetic called Devine and the store manager was given $150,000 by the corporate office to improvestore performance any way she thinks best. The "base case" information is a price of $30 per bottle, a contribution margin of 0.30,a customer defection rate of 18 percent, and a repurchase frequency of five times a year. If these improvement funds could beused to (a) increase the contribution margin to 0.34 or (b) reduce the customer defection rate to 16 percent or (c) increase therepurchase frequency to six times per year. Assume all other variables remain at the base case level for each of the threeimprovement options.Use the Excel template VLC to calculate the VLC for each option and summarize your answers using the table below. Round youranswers to the nearest cent.(a)(b)(c)ContributionPrice$30$30$30$30RepurchaseMargin0.300.340.300.30DefectionFrequency Rate5556What is the best way to use $150,000 in improvement funds?The best way to use the $150,000 in improvement funds is-Select--Select-option (a)option (b)option (c)18% $6918% $16%$18% $6969VLC in $

Give data : Contribution price Repurchase marginDefection frequency Rate…

Answered: A retail store sells a popular cosmetic…

Marketing

20th Edition

ISBN:9780357033791

Author:Pride, William M

Publisher:Pride, William M

Chapter19: Pricing Concepts

Section: Chapter Questions

Problem 6DRQ

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Provide a brief explanation of the conceptual relationship between improvements in quality andimprovements in financial performance.
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