Scale Co. offers a promotional coupon with every product it sells. The coupon gives the Scale Co. customer an opportunity to buy an electric drill that normally sells for $50 for only $30 (a 40% discount). The coupon must be redeemed within one year of the purchase. Scale Co. estimates that 80% of customers will take advantage of the coupon. What is the stand-alone selling price of the coupon

Question

Business

Veronica Jefferson

17 January, 08:07

Scale Co. offers a promotional coupon with every product it sells. The coupon gives the Scale Co. customer an opportunity to buy an electric drill that normally sells for $50 for only $30 (a 40% discount). The coupon must be redeemed within one year of the purchase. Scale Co. estimates that 80% of customers will take advantage of the coupon. What is the stand-alone selling price of the coupon

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Answers (1)

Know the Answer?

Terrence Allison · Answer 1

Question is incomplete, Here are the Options:

a. $20

b. $30

c. $50

d. $16 is Correct

Explanation:

Since Scale Co. estimates just 80 percent of the coupons to be used.

They calculates a coupon's stand-alone selling price at $20 (40 percent of 50) = 80 percent = $16 ($20, the discount number, is the commodity right in which a fraction of the selling price must be allocated).