Sales dollar achieved as result of the advertising

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A retailer, Play It Sports expects to sell $27,000 worth of tennis balls in a typical month without any advertising. In May, while running a newspaper ad campaign that cost $1,500 the store sells $46,000 worth of tennis balls. It engages in no other promotions or non-recurring events during the month. For the month of June, Play It Sports has negotiated a deal with their tennis ball supplier, who will offer a one-month promotional opportunity to purchase tennis balls at price discounted by 20%. Currently, Play It Sports sells tennis balls at a price of $9.00, but they plan on reducing the price by $1.00 during the promotion. The current margin Play It Sports makes on tennis balls is 35%.

What was the the cost to the retailer per incremental sales dollar achieved as a result of the advertising?

Reference no: EM132090308

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