There is excitement in the air! The new UltraGuard flea collar is about to be...
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There is excitement in the air! The new UltraGuard flea collar is about to be introduced to the market. The collar will feature enhanced protection, increased longevity and is environmentally friendly. It will be priced at $8.95 and has unit variable costs of $3.65. The company expects to sell 50,500 UltraGuard collars during the next six months. Some of the sales will come at the expense of the current product, the PetArmor collar, priced at $6.40 with variable costs of $2.95. The market analyst estimates that the UltraGuard collar will cannibalize 20,750 PetArmor collars during the introductory 6 month period. Calculate the change in total contribution margin for the introductory six month period.
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