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Total Cost, Total Revenue, and Profit Change as You Sell More Shoes.

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Presentation on theme: "Total Cost, Total Revenue, and Profit Change as You Sell More Shoes."— Presentation transcript:

1 Total Cost, Total Revenue, and Profit Change as You Sell More Shoes

2 Four Types of Elasticity Price (Demand) Elasticity = %Q / %P Advertising Elasticity = %Q / %Ad Elasticity of Markup (Return on Sales, Operational Efficiency)= %R / %Mp Elasticity of ROME (ROMI, Marketing Productivity)= %ROME / %Promotion

3 Four Types of Elasticity Price (Demand) Elasticity = %Q / %P Advertising Elasticity = %Q / %Ad Elasticity of Markup (Return on Sales, Operational Efficiency)= %R / %Mp Elasticity of ROME (ROMI, Marketing Productivity)= %ROME / %Promotion

4 Total Revenue Goes up if you sell more Shoes, Q $ Quantity of Shoes Sold Total Revenue

5 Total Cost Goes up faster and faster as you sell more Shoes, $ Quantity of Shoes Sold Total Cost

6 Profit Goes up and down as you sell more Shoes, Q $ Quantity of Shoes Sold Total Cost Total Revenue profit LOSS

7 Profit Goes up and down as you sell more Shoes, Q $ Quantity of Shoes Sold Total Cost Total Revenue LOSS Profit

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