Farmers Groceries To You (FGTY) is a fast-growing company started by JMU alumni, which delivers fresh groceries collected in Virginia farms to families in the Shenandoah region. As part of an expansion plan, FGTY is considering approaching the northern Virginia market through printed product lists (PLs) containing deals, coupons and customers testimonies. The initial plan is to send 200,000 PLs to households in Fairfax and Arlington, expecting new customers to place orders. The company estimates to incur a fixed cost of $30,000 associated with design, printing setup and transportation contracting. Beyond this, the average transportation cost per PL is ¢20, while the printing cost per PL is ¢10. Also, FGTY incurs in an average cost of ¢25 for processing each order placed by a customer using the PL’s promotion codes. The expected size of an order is $50, and FGTY’s variable cost per order (mainly product costs labor) is close to 80% of the order’s average. You’ve been hired to help FGTY develop a model to determine the profit from PLs’ orders and see how sensitive the profit is to the percentage of households receiving a PL that place an order. Please complete the tasks below:
1. Find an expression to calculate the minimum percentage of households receiving a PL who place an order for FGTY to break even in their expansion endeavor. Show the mathematical procedure to get to the expression.
2. Develop a spreadsheet model for FGTY in Excel where you implement the expression found above and format the corresponding cell as a percentage with three decimals. Make sure to format dollar amounts with $ and zero decimals (dollar amounts less than $1 should display two decimal points). Also, use thousands separators when appropriate. names this sheet FGTY
Hi, I need help with question number 2. The answer for question 1 is y/x * 100% >= 100%, how would I put this in Excel? Than you :))
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