Morice Industries Inc

question 36

Multiple Choice

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 is the reference value that Morice should consider when pricing model IA-05?

• A) $54,000
• B) $68,000
• C) $108,000
• D) $61,000

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Definitions:

Case Management

Organized system for delivering health care to an individual patient or group of patients across an episode of illness and/or a continuum of care; includes assessment and development of a plan of care, coordination of all services, referral, and follow-up; usually assigned to one professional.

Cost-effectiveness

A measure used to evaluate the efficiency of a product or service by comparing its cost to the benefits it delivers, often used in healthcare to determine the best use of limited resources.

Diabetes

A chronic metabolic disease characterized by high blood sugar levels due to insulin production abnormalities or the body's response to insulin.

Evidence-based

An approach that prioritizes the use of data and strong, scientifically-backed information in decision-making processes, particularly within healthcare.