how would you calculate the expected profit for a client who invests 5,500 on a podcast ad and 10,000 on a tv ad?
To calculate the expected profit for a client who invests $5,500 on a podcast ad and $10,000 on a TV ad, you would first need to estimate the revenues generated from each ad campaign.
One way to estimate the revenues is by calculating the return on investment (ROI) for each ad campaign. The ROI is calculated as follows:
ROI = (Revenue - Cost) / Cost
Next, you would calculate the expected revenue generated from each ad campaign using the ROI.
For example, if the ROI for the podcast ad campaign is estimated to be 150% (1.5) and the ROI for the TV ad campaign is estimated to be 120% (1.2), you would calculate the expected revenue generated from each ad campaign as follows:
Podcast ad revenue = ($5,500 * 1.5) - $5,500 = $7,750
TV ad revenue = ($10,000 * 1.2) - $10,000 = $12,000
Finally, you would subtract the total cost of both ad campaigns from the total expected revenue to calculate the expected profit for the client:
Expected profit = ($7,750 + $12,000) - ($5,500 + $10,000) = $4,250
Therefore, the expected profit for the client who invests $5,500 on a podcast ad and $10,000 on a TV ad would be $4,250.