Queen of Shaves In 2000, Queen of Shaves introduced 10-ounce aerosol Silky Smooth shaving ge I. For 2001, Queen of Shaves is considering adding either a 5.5 or 7.5 oz aerosol. According to market research, there is a 25% chance of a low estimate and a 7 5% chance of a high estimate for the following incremental product line contrib utions (note: the estimated product line contribution accounts for any cannibali zation): Estimated Total Incremental Product Line Contribution: A: Low estimate for 5.5 oz. aerosol can $100,000 B: High estimate for 5.5 oz. aerosol can $125,000 C: Low estimate for 7.5 oz. aerosol can $50,000 D: High estimate for 7.5 oz. aerosol can $140,000 What is the maximum Queen of Shaves should pay for additional test market re search? (4 points) In 2004, Dunn Edwards has realized that reducing prices by 10% is not a good st rategy for the company. Thus, the company decided to decrease prices by only 5% instead in 2004. Given that the contribution margin is 40% in 2003 and the p revious year's (2003) sales were 12 million A. Percentage sales increase needed to maintain the 2003 level of contribution? B. Using outcome in 'A'above, how do you characterize this environment (.e., a p rice elastic vs. inelastic environment) and why? Queen of Shaves In 2000, Queen of Shaves introduced 10-ounce aerosol Silky Smooth shaving ge I. For 2001, Queen of Shaves is considering adding either a 5.5 or 7.5 oz aerosol. According to market research, there is a 25% chance of a low estimate and a 7 5% chance of a high estimate for the following incremental product line contrib utions (note: the estimated product line contribution accounts for any cannibali zation): Estimated Total Incremental Product Line Contribution: A: Low estimate for 5.5 oz. aerosol can $100,000 B: High estimate for 5.5 oz. aerosol can $125,000 C: Low estimate for 7.5 oz. aerosol can $50,000 D: High estimate for 7.5 oz. aerosol can $140,000 What is the maximum Queen of Shaves should pay for additional test market re search? (4 points) In 2004, Dunn Edwards has realized that reducing prices by 10% is not a good st rategy for the company. Thus, the company decided to decrease prices by only 5% instead in 2004. Given that the contribution margin is 40% in 2003 and the p revious year's (2003) sales were 12 million A. Percentage sales increase needed to maintain the 2003 level of contribution? B. Using outcome in 'A'above, how do you characterize this environment (.e., a p rice elastic vs. inelastic environment) and why