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Honda Motor Company is considering offering a $1,900 rebate on its​ minivan, lowering the​ vehicle's price...

Honda Motor Company is considering offering a $1,900 rebate on its​ minivan, lowering the​ vehicle's price from $29,200 to $27,300. The marketing group estimates that this rebate will increase sales over the next year from 41,400 to 54,500 vehicles. Suppose​ Honda's profit margin with the rebate is $6,310 per vehicle. If the change in sales is the only consequence of this​ decision, what are its costs and​ benefits? Is it a good​ idea?​ Hint: View this question in terms of incremental profits.

The cost of the rebate will be million. ​(Round to one decimal​ place.)

The benefit of the rebate will be. million.  ​(Round to one decimal​ place.)

Is it a good​ idea?  ​(Select from the​ drop-down menu.)

does

look attractive.

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Expert Solution

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

jeff jeffy answered 2 years ago
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