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Maximizing Profits Through Advertising Strategy

Learn how to optimize advertising spending to maximize profits. Discover the ideal advertising budget for Wooden-Box Inc. to boost sales. Calculate marketing profits efficiently using the provided sales prediction model.

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Maximizing Profits Through Advertising Strategy

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  1. Optimal Advertising

  2. Wooden-Box Inc. makes wooden boxes and sells them at a price that provides a unit contribution, (P-V)= $5 per box. The market research department has estimated the function that predicts the number of boxes that are sold because of the advertising. The number of boxes sold due to the size of the advertising expenditure can be estimated by the function • Q = 1,500A0.44 • where Q = quantity sold • A = the amount of money spent on advertising • If the optimal amount of advertising is spent, then what is the profit after advertising (aka marketing profit)?

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