Business, 19.03.2021 18:30 natalie2sheffield

Media outlets often have websites that provide in-depth coverage of news and events. Portions of these websites are restricted to members who pay a monthly subscription to gain access to exclusive news and commentary. These websites typically offer a free trial period to introduce viewers to the website. Assume that during a recent fiscal year, one outlet spent $2,368,800 on a promotional campaign for its website that offered two free months of service for new subscribers. In addition, assume the following information: Number of months an average new customer stays with the service (including the two free months) 22 months
Revenue per month per customer subscription $21
Variable cost per month per customer subscription $7

Determine the number of new customer accounts needed to break even on the cost of the promotional campaign. In forming your

a. treat the cost of the promotional campaign as a fixed cost
b. treat the revenue less variable cost per account for the subscription period as the unit contribution margin.

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Media outlets often have websites that provide in-depth coverage of news and events. Portions of the...

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