### What would explain the change

Assignment Help Finance Basics
##### Reference no: EM13264702

Taste Good Chocolates develops a new candy and plans to sell each bar for \$1. Tast Good predicts that 1 million candy bars will be sold in the first year if the new candy bar is produced and sold, and includes \$1 million of incremental revenues in its capital budgeting analysis. A senior executive in the company believes that 1 million candy bars will indeed be sold, but lowers the estimate of incremental revenue to \$700,000. What would explain the change?

a. Cannibalization of 300,000 of Taste Good Chocolate's other candy bars
b. Excessive marketing costs to sell the 1 million candy bars
c. A lower discount rate
d. A higher selling price for the new candy bars

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