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Sorry for the confusion guys; the confusion resulted from a matter of semantics, rather than a flaw in the formula; I should have been clearer on the meaning of the value for E.
What I should have stated was that you must first set a minimum acceptable profit margin, which must be less than the actual profit margin which has been produced by the modeling.
Therefore, I have edited the original example to eliminate the confusion and provide a clearer explanation of the use of the formula.
Take care.
THE GENERAL
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