Determine the cost of the beverage versus what the market would bear as far as price.An important aspect of looking at alternative courses of action in marketing strategy is performing a financial analysis.

Have you ever wondered why a 16-ounce beverage costs only a little more than the 12- ounce serving? Chances are that the company producing the beverage conducted a financial analysis to determine the cost of the beverage versus what the market would bear as far as price.An important aspect of looking at alternative courses of action in marketing strategy is performing a financial analysis. Before deciding on a course of action, marketing professionals need to understand the economic consequences of each alternative course of action. The Harvard Case Study, “Note on Marketing Arithmetic and Related Marketing Terms” by Star, Heskett, and Levitt (1974), defines several financial terms and explains formulas you might use to calculate the effects of changes to a marketing program. For example, by using the equations in this article, you could determine how many additional units of a product your company would need to sell to maintain profitability if you increase the variable cost associated with manufacturing it.For this Application, you verify your understanding of several key concepts. the completed Marketing Arithmetic Exercise Calculations spreadsheet. In addition, submit a separate Word document in which you answer the following questions:Tips for working with the spreadsheet:: Your Word document will typically be 3–4 pages in length (1.5 to 2 pages, if single spaced). Refer to the Week 7 Assignment Rubric for specific grading elements and criteria for this assignment. Your Instructor will use this rubric to assess your work.

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