##### Scenario You run a restaurant and a Groupon-like site asks you to sell coupons through them. ##### Question Which factors (price elasticity, cannibalization, customer acquisition, brand impact, etc.) would you evaluate before deciding whether to participate? Using: 20 tables/day, $30 average check, variable cost = 0.4 × sales, fixed cost = $100/day, calculate current daily profit. If you join and pay a 40% commission, one coupon per table, what minimum average spend per coupon table keeps profit unchanged? Given that figure, would you initially join the site? Explain. After joining you observe: 25 tables/day, 10 tables use coupons, $36 average check, costs unchanged. Compute new daily profit. Does participation now raise or lower profit? Why? Based on this, should the restaurant keep working with the site? ##### Hints Quantify revenue, subtract variable and fixed costs, compare baseline vs coupon scenario; explore how incremental tables and commission change contribution margin.

This question evaluates a candidate's ability to analyze unit economics, profitability calculations, and business metrics such as demand, average check, commission impacts, and fixed versus variable cost effects.

How do I approach Analytics & Experimentation interview questions?

Analytics & Experimentation questions require understanding of core concepts and practice. PracHub provides solutions with explanations to help you master analytics & experimentation interviews.

What difficulty level is this interview question?

This is a medium difficulty Analytics & Experimentation question, commonly asked during Onsite rounds at Capital One.

What role is this question designed for?

This question is commonly asked for Data Scientist candidates at Capital One during technical interviews.

Evaluate Profit Impact Before Joining Coupon Site | Capital One Interview Question

Restaurant Coupon Decision: Factors and Unit Economics

Context

You operate a restaurant. A deals platform proposes selling coupons. For coupon tables, the platform charges a 40% commission on the table's sales. Your current unit economics:

Daily demand: 20 tables/day
Average check (baseline): $30 per table
Variable cost: 40% of sales
Fixed cost: $100/day

Assume one coupon can be used per table and that variable and fixed costs do not change with the decision.

Tasks

Before deciding, list the key factors you would evaluate (e.g., price elasticity, cannibalization, customer acquisition, brand impact, capacity, etc.).
Compute your current daily profit (without the platform).
If you join and pay a 40% commission, what is the minimum average spend per coupon table that keeps profit unchanged if a coupon table replaces a regular table (i.e., total tables stay at 20)? Show the logic.
Given that figure, would you initially join the site? Explain your reasoning.
After joining you observe: 25 tables/day, 10 tables use coupons, average check = $36, costs unchanged. Compute the new daily profit and determine whether participation raises or lowers profit. Based on this result, should the restaurant keep working with the site?

Context

You operate a restaurant. A deals platform proposes selling coupons. For coupon tables, the platform charges a 40% commission on the table's sales. Your current unit economics:

Daily demand: 20 tables/day

Average check (baseline): $30 per table

Variable cost: 40% of sales

Fixed cost: $100/day

Assume one coupon can be used per table and that variable and fixed costs do not change with the decision.

Tasks

Before deciding, list the key factors you would evaluate (e.g., price elasticity, cannibalization, customer acquisition, brand impact, capacity, etc.).

Compute your current daily profit (without the platform).

If you join and pay a 40% commission, what is the minimum average spend per coupon table that keeps profit unchanged if a coupon table replaces a regular table (i.e., total tables stay at 20)? Show the logic.

Given that figure, would you initially join the site? Explain your reasoning.

After joining you observe: 25 tables/day, 10 tables use coupons, average check = $36, costs unchanged. Compute the new daily profit and determine whether participation raises or lowers profit. Based on this result, should the restaurant keep working with the site?

Evaluate Profit Impact Before Joining Coupon Site

Quick Overview

Restaurant Coupon Decision: Factors and Unit Economics

Context

Tasks

Solution

Comments (0)

Evaluate Profit Impact Before Joining Coupon Site

Quick Overview

Restaurant Coupon Decision: Factors and Unit Economics

Context

Tasks

Solution

Comments (0)