The Examiner's Answers – November 2011 E3 - Enterprise Strategy

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The Examiner's Answers – November 2011 E3 - Enterprise Strategy SECTION A Answer to Question One Requirement (a)(i) The impact of the three possible pricing strategies suggested by X and financial effect of changing the Daily News website to a subscription basisis shown in the tables below: (i) Current advertising revenue per week Pages 5

Price per page £ 6,000

Days 7

Total £ 210,000

(ii) Forecast subscription revenue per week Strategy

Daily subscriptions: Price per day

Daily subscriptions: Forecast number of subscribers per day

1 2 3

£0.25 £0.50 £0.75

4,000 3,500 1,500

Total daily subscriptions revenue per week

Weekly subscriptions: Price per Week

£ 7,000 12,250 7,875

£ 0.50 0.75 1.50

Weekly subscriptions: Forecast number of subscribers per week 17,000 15,000 6,000

Total weekly subscription revenue

Total subscription revenue

£ 8,500 11,250 9,000

£ 15,500 23,500 16,875

(iii) Forecast advertising revenue per week Strategy

1 2 3

Days

7 7 7

Enterprise Strategy

Revenue per page £ 4,000 3,750 2,500

Forecast number of pages sold per day 7 9 10

1

Total weekly revenue £ 196,000 236,250 175,000

November 2011


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