Selling opaque white toothpaste

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A company has been selling an opaque white toothpaste successfully. However, since consumer research (concept tests) revealed that a gel version might do very well, the company is contemplating the introduction of a new gel toothpaste. Consider the following data: Opaque (unit selling price = $1.00, unit variable costs = 20 cents) & Gel (unit selling price = $1.10, unit variable costs = 40 cents). Market research indicates that the company may expect to sell 1 million units of the Gel in the first year after introduction and that, of that amount, 500, 000 units will be diverted from the Opaque, of which the company had expected to sell one million units. What should the marketing manager do?

Reference no: EM132261276

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