RoboGarden sells a robot lawn aerator. At the current price, RoboGarden\'s contr

Question

RoboGarden sells a robot lawn aerator. At the current price, RoboGarden's contribution margin is $134.71 per unit. Because of a shortage of silicon chips, RoboGarden expects variable cost to increase by $12.04. In response, RoboGarden is thinking about raising its selling price by $39.16. Calculate the percent profit breakeven metric for this situation. Report the correct sign for the result. Report your answer as a percent. Report -25.5%, for example, as "-25.5". Rounding: tenth of a percent.

MARKETING METRICS IS THE SUBJECT OF THE QUESTION.

Explanation / Answer

Let the variable cost is x and the selling price is 134.71+x
now after increase the variable cost is 12.04+x and the sellingg price is =134.71+x+39.16
The contribution margin is = selling price-variable cost
=134.71+x+39.16-12.04-x
=161.83
the increase in the profit in this situation is =(161.83/134.71)-1
=20.13%

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