Adequate information: Percentage of success if the firm goes to market directly = 55% Cost of customer segment research = $875,000 Present value profit (at the time of initial selling) = $16.5 million Present value payoff = $7.5 million Discount rate = 13% To calculate : Should the firm conduct customer segment research or go directly to the market?

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Chapter 7, Problem 8QAP

Summary Introduction

Adequate information:

Percentage of success if the firm goes to market directly = 55%

Cost of customer segment research = $875,000

Present value profit (at the time of initial selling) = $16.5 million

Present value payoff = $7.5 million

Discount rate = 13%

To calculate: Should the firm conduct customer segment research or go directly to the market?

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