4 ms·
Small math quibble: a 20% reduction in per unit price requires a 25% increase in unit volume. 20% reduction = 0.8 times the price, 25% increase = 1/0.8 times th
by ThrustVectoring 10y ago
Small math quibble: a 20% reduction in per unit price requires a 25% increase in unit volume. 20% reduction = 0.8 times the price, 25% increase = 1/0.8 times the volume.
For a reducto ad absurdum that I use to help remember this thing: a 100% decrease in price isn't counterbalanced by a 100% increase in volume.
- rahimnathwani 10y agoOops. Yes, I stated 20% increase earlier in my answer. But I think the final number (27%) is correct. It's higher than your 25%, because I assumed non-zero fuel costs. So breaking even on revenue wouldn't be sufficient to break even on profit.