glucose monitoring watch question, Help needed please! An estimated $83.70 will
ID: 2756582 • Letter: G
Question
glucose monitoring watch question, Help needed please!
An estimated $83.70 will be the cost to produce a watch.
total market category (TAM) in China is 98.4 million, India has 65.1 million and the United States carries 24.4 million. The served market (SAM) will be calculated to be estimated 48.2 million, 33 million and 12.2 million for China, India, and the United States respectively.
Mark up for retail or sales price for service
Mark up Calculation for first year retail sales $83.70 product manufacturing cost with a 60% markup will yield a $133.92 Retail sales price.
Therefore a more realistic 50% of the TAM puts the market share potential within 20% aggressive start up goal.
Please help determine Profit/loss for product including estimated administrative costs Please show all steps in calculating the information
Explanation / Answer
Answer:
Cost of watch = $83.7
TAM for :
China = 98.4 million
India = 65.1 million
US = 24.4 million
SAM for:
China = 48.2 million
India = 33 million
US = 12.2 million
First year sales will yield $133.92
As the cost of product = $83.7
and Mark up = $133.92 - $83.7 = $50.22
Administrative cost can will be below = $50.22
Now profit = $50.22 per unit sold
Total collective units sold in all markets = 93.4 million
Hence total profit = 93.4 million x $50.22 = $4,690.548 million
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