Question

Chester's Elite product Cat has an awareness of 72%. Chester's Cat product manager for the Elite segment is determined to have more awareness for Cat than Andrews' Elite product Ant. She knows that the first $1M in promotion generates 22% new awareness, the second million adds 23% more and the third million adds another 5%. She also knows one-third of Cat's existing awareness is lost every year. Assuming that Ant's awareness stays the same next year (77%), out of the promotion budgets below, what is the minimum Chester's Elite product manager should spend in promotion to earn more awareness than Andrews' Ant product

Answer 1

$2 million

Step-by-step explanation:

It is given that the 77% is exiting awareness out of which one-third is lost i.e 26% and the target of the company to create the awareness for minimum 26% so for that the company should invested $2 million as it generates the awareness among the 45% people aware i.e 22% + 23% but what we needs 26% at least so the company should go for $2 million