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Fluffy Cake, a seller of cakes, is considering introducing a healthier version o...
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Fluffy Cake, a seller of cakes, is considering introducing a healthier version of its cakes. The firm expects that sales of the new healthy cake will be $5 million per year. Fluffy Cake estimates that the original cake’s sales will drop by 20% due to the switch to the healthy version. The current level of sales of the original cake is $12 million. The firm also expects that due to the introduction of healthy cakes the current sales of spinach cupcakes will be increased by 15%. The current level of sales of spinach cupcakes is $8 million. What is the level of incremental sales?
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