To attract more subscribers, A New York City daily newspaper called Manhattan Today offered new...
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To attract more subscribers, A New York City daily newspaper called Manhattan Today offered new subscribers the ability to pay $250 for an annual subscription that also would include a coupon to receive a 20% discount on a one-hour ride through Central Park in a horse-drawn carriage. The annual subscription normally charges a fee of $300. The list price of a carriage ride is $100 per hour. The company estimates that approximately 40% of the coupons will be redeemed. What is the stand-alone selling price of the coupon, i.e., the amount used to allocate the total transaction price?
To attract more subscribers, A New York City daily newspaper called Manhattan Today offered new subscribers the ability to pay $250 for an annual subscription that also would include a coupon to receive a 20% discount on a one-hour ride through Central Park in a horse-drawn carriage. The annual subscription normally charges a fee of $300. The list price of a carriage ride is $100 per hour. The company estimates that approximately 40% of the coupons will be redeemed. What is the stand-alone selling price of the coupon, i.e., the amount used to allocate the total transaction price?
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