For some reason having trouble figuring out question 4 ; maybe my brain is too tired, but help would be very much appreciated!
You're awesome, thank you!
For some reason having trouble figuring out question 4 ; maybe my brain is too tired, but help would be very much appreciated!
Hi,
Old situation:
-- 10M subscribers
-- 20$/month subscription fee
-- 1800$/year goods sold per subscriber
-- 3% commission for each transaction
-- 1B$ fixed cost
-- 110M$ variable cost per subscriber
--> this leads to a profit of 20$/month per subscriber
New situation:
-- 10M subscribers (same)
-- 10$/month subscription fee (change)
-- x$/year goods sold per subscriber (what we have to calculate)
-- 3% commission for each transaction (same)
-- 1B$ fixed cost (same)
-- 110M$ variable cost per subscriber (same)
--> Costs remain constant (no factor changed): C = 1B$ + 10M*110M$ = 2.1B$
--> To maintain the same profitability Revenue per customer should be the same: R_new = 12*10$ + x*3% = R_old = 12*20$ + 1800$*3% = 294$
--> x = (294$ - 120$) / 3% = 5800$
Hope it helps,
Antonello
Hello!
Before putting the numbers, might help u to solve it "theoretically". Write both equations from both situations (revenue - fixed cost - variable cost) and outline which is the factor you are missing, since that is the answer you are looking for.
Hope it helps!
Cheers,
Clara
You're awesome, thank you!
In diesem Text wird der Unterschied anhand von verständlichen Beispielen erklärt und auf die Branche sowie Fälle der Unternehmensberatungen bezogen.
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Amazing, thank you so much