A company tracks the performance of three sales teams, each responsible for different

regions. The first team generated $500,000 in revenue with a 25% contribution, the second

team $750,000 with a 35% contribution, and the third team $1,000,000 with a 40% contribution.

- Calculate the overall weighted average revenue.

To calculate the overall weighted average revenue, we need to consider both the revenue generated by each team and their respective contribution percentages. The formula for the weighted average revenue is:

\[
\text{Weighted Average Revenue} = \left(\frac{\text{Team 1 Revenue} \times \text{Team 1 Contribution} + \text{Team 2 Revenue} \times \text{Team 2 Contribution} + \text{Team 3 Revenue} \times \text{Team 3 Contribution}}{\text{Total Contribution Percentage}}\right)
\]

Given:
- First team's revenue: $500,000 with a 25% contribution
- Second team's revenue: $750,000 with a 35% contribution
- Third team's revenue: $1,000,000 with a 40% contribution

The total contribution percentage is:

\[
\text{Total Contribution Percentage} = 25\% + 35\% + 40\% = 100\%
\]

Now, we calculate the weighted sum of the revenues:

\[
\text{Weighted Sum} = (500,000 \times 0.25) + (750,000 \times 0.35) + (1,000,000 \times 0.40)
\]

\[
\text{Weighted Sum} = 125,000 + 262,500 + 400,000 = 787,500
\]

Since the total contribution percentage is 100%, the weighted average revenue is simply the weighted sum:

\[
\text{Weighted Average Revenue} = 787,500
\]

**Answer:** The overall weighted average revenue is $787,500.

Would you like more details or have any questions?

Here are 5 related questions you might find interesting:
1. How would the weighted average revenue change if the first team's contribution increased to 30%?
2. What is the impact on the weighted average revenue if the second team's contribution decreased to 25%?
3. How does the weighted average revenue compare to the simple average revenue calculated previously?
4. If a fourth team with a revenue of $600,000 and a 20% contribution was added, how would the weighted average revenue change?
5. What would be the weighted average revenue if all teams had equal contribution percentages?

**Tip:** Weighted averages are particularly useful when different elements have varying levels of importance or impact, as seen with contribution percentages in this problem.

Learn how to calculate the overall weighted average revenue of three sales teams based on their revenues and contribution percentages. This problem involves using the weighted average formula to determine the combined revenue impact of each team. Suitable for advanced high school students and beyond.

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