Wermers Industries Inc. has developed a new drill press, model LS-88, that is designed to offer superior performance to a comparable drill press sold by Wermers's main competitor. The competing drill press sells for $31,000 and needs to be replaced after 1,000 hours of use. It also requires $6,000 of preventive maintenance during its useful life. ModelLS-88'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 $7,000 of preventive maintenance during its useful life.From a value-based pricing standpoint, what range of possible prices should Wermers consider when setting a price for model LS-88?
A. $36,000 ? Value-based price ? $62,000
B. $36,000 ? Value-based price ? $67,000
C. $31,000 ? Value-based price ? $67,000
D. $31,000 ? Value-based price ? $62,000
Answer: C
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