Compute Groupon unit economics and break-even
Company: Capital One
Role: Data Scientist
Category: Statistics & Math
Difficulty: easy
Interview Round: Technical Screen
A restaurant has variable cost (VC) = 40% of pre-discount spend and fixed cost (FC) = $100/day. Assume one table per party. Answer the following, showing formulas and final numbers: 1) Baseline day (no coupons): 20 tables/day, average spend/table = $30. Compute daily profit. 2) Groupon voucher mechanics: Customers buy a $30-value voucher for $15; Groupon retains a 40% commission on the $15; one voucher can be applied per table; ignore tips and taxes. Define n as the table’s total pre-discount spend when a voucher is used. Using the simplified unit-economics model Revenue = n, Costs = 0.4n + $15 (face-value benefit) + 0.4×$15 (commission on voucher payment), solve for the break-even n where the table contributes zero profit. 3) New day with mixed tables: 25 tables/day total, 10 tables use a voucher, average pre-discount spend for all tables (coupon and regular) = $36. Compute total daily profit using: Profit_regular_table = 0.6×36; Profit_coupon_table = 36 − 0.4×36 − 15 − 0.4×15; Daily profit = 15×Profit_regular_table + 10×Profit_coupon_table − 100. 4) Sensitivity: What minimum average pre-discount spend per coupon table (assume regular tables remain at $36, counts unchanged) makes daily profit equal to the baseline in part 1?
Quick Answer: This question evaluates unit economics, break-even analysis, basic algebra, and sensitivity analysis skills within a Data Scientist context. It is commonly asked to measure applied statistical and mathematical reasoning in the Statistics & Math domain, testing practical application of quantitative modeling and profitability metrics rather than purely conceptual theory.
