The promotion again is set up only for one free pair per customer the consumer

The promotion again is set up only for one free pair

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pair “technically” would cost $50 (half of the retail price). The promotion again is set up only for one “free” pair per customer; the consumer would then have to pay full price if they decided to make an additional purchase. This promotion implies from the store clerk’s perspective, that everything is “technically” 50% off and by offering 40% off, a saving/profit margin increases by 10%, which also increases the revenue of the store. c. The reason the clerk was willing to offer the “buy, get one free” deal is because there is a limit set on the deal. This type of promotion attracts customers into the store, because they believe they are getting an unbelievable deal, while the store is able to move inventory and make profit. The store and clerk maintains a level of revenue that they aimed for with the promotion and possibly can see increases in profit if a consumer needs a third pair (which would be sold at full price). The reason he is unwilling to sell it at 50% off is because of the very definition noted above. The campaign is to attract people into the store, increase margin and profit, and move inventory. Depending on how much the store acquired the shoes for, taking a hit on one pair per customer is easier than selling at half the retail cost for all items. The margin and profit missed could be significant (contingent on if the consumer is willing to go beyond 2 pairs (one purchased and one free)). 4. a. Decision Tree
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b. Based off of the Decision Tree above, it is best to expand since $1.6M > $1.5M
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