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Allison has a horse stall cleaning business that has been growing rapidly since she started it three years ago. She estimates the total number of horse stalls in her market to be 5000, owned by a total potential population of 1500. Currently, there are only two competitors in the market, Allison, who has 650 stalls that she cleans, and Sam's Hayfaring Maneger, that cleans 1,320 stalls. The remainder of the stalls are cleaned by their owners rather than by a service. Allison prices her cleaning services at $12 per stall per month and Sam charges $8 for the same service. Allison's sales are derived from 104 customers while Sam's are from 71 customers, meaning that Sam's customers have more stalls on a per capita basis. What is the market penetration rate based on potential customers

User Kuppuram
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1 Answer

11 votes
11 votes

Answer:

the market penetration rate based on potential customers is 11.66%

Step-by-step explanation:

The computation of the market penetration rate based on potential customers is shown below

= Alison + sam

= (104 customers ÷ 1500) + (71 customers ÷ 1500)

= 6.93 % + 4.73%

= 11.66%

hence, the market penetration rate based on potential customers is 11.66%

We simply added both the Alison and sam so that the market penetration rate could come

User Royal
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