What does total market potential mean? How can it be estimated?
What will be an ideal response?
Total market potential is the maximum sales available to all firms in an industry during a given period, under a given level of industry marketing effort and environmental conditions.
A common way to estimate total market potential is to multiply the potential number of buyers by the average quantity each purchases, times the price. A variation on this method is the chain-ratio method, which multiplies a base number by several adjusting percentages.
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