Interview Query

Ad Placement Value

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You are the owner of an eCommerce platform. Let’s say you would like to place an advertisement on Facebook.

The Facebook advertising team tells you that the cost of a specific ad placement is $0.05\$0.05 per impression, and the click-through rate (click per impression) is 1%. On the other hand, based on your historical data, you have an average of 2% transaction rate on your website (number of transactions per website visit). How much would the overall advertising cost per transaction be?

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