Morice Industries Inc. has developed a new injection mold, model IA-05, that is designed to offer superior performance to a comparable injection mold sold by Morice's main competitor. The competing injection mold sells for $54,000 and needs to be replaced after 1,000 hours of use. It also requires $7,000 of preventive maintenance during its useful life. Model IA-05's performance capabilities are similar to the competing product with two important exceptions-it needs to be replaced only after 2,000 hours of use and it requires $8,000 of preventive maintenance during its useful life.From a value-based pricing standpoint, what range of possible prices should Morice consider when setting a price for model IA-05?
A. $60,000 ? Value-based price ? $114,000
B. $54,000 ? Value-based price ? $114,000
C. $60,000 ? Value-based price ? $108,000
D. $54,000 ? Value-based price ? $108,000
Answer: B
You might also like to view...
Project initiation is the process by which systems proposals are assessed for consistency with the strategic systems plan and evaluated in terms of their feasibility and cost-benefit characteristics
Indicate whether the statement is true or false
Insurance policies can only be sold by direct agents of an insurer
Indicate whether the statement is true or false
Freiman Corporation's most recent balance sheet and income statement appear below:Balance SheetDecember 31, Year 2 and Year 1(in thousands of dollars) Year 2Year 1Assets Current assets: Cash$160 $120 Accounts receivable, net 220 240 Inventory 120 130 Prepaid expenses 40 40 Total current assets 540 530 Plant and equipment, net 700 700 Total assets$1,240 $1,230 Liabilities and Stockholders' Equity Current liabilities: Accounts payable$130 $150 Accrued liabilities 90 90 Notes payable, short term 60 70 Total current liabilities 280 310 Bonds payable 280 290 Total liabilities 560 600 Stockholders' equity: Common stock, $2 par value 100 100 Additional paid-in
capital 200 200 Retained earnings 380 330 Total stockholders' equity 680 630 Total liabilities & stockholders' equity$1,240 $1,230 Income StatementFor the Year Ended December 31, Year 2(in thousands of dollars)Sales (all on account)$1,310 Cost of goods sold 780 Gross margin 530 Selling and administrative expenses 359 Net operating income 171 Interest expense 35 Net income before taxes 136 Income taxes (30%) 41 Net income$95 The average collection period for Year 2 is closest to: A. 1.1 days B. 64.0 days C. 0.9 days D. 61.3 days
Programmers can trust user input if the person is strongly authenticated
Indicate whether the statement is true or false.