Cables Electronics Corporation Has Developed a New Instrument-Model XG-75-That Has

question 375

Multiple Choice

Cables Electronics Corporation has developed a new instrument-model XG-75-that has been designed to outperform a competitor's best-selling instrument. Model XG-75 has a useful life of 46,000 hours of service and its operating cost is $2.80 per hour. In contrast, the competitor's product has a useful life of 23,000 hours of service and has operating costs that average $5.40 per hour. The competitor's instrument sells for $160,000. Cables has not yet established a selling price for model XG-75. From a value-based pricing standpoint what is the reference value that Cables should consider when pricing model XG-75?

• A) $284,200
• B) $279,600
• C) $344,000
• D) $160,000

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Definitions:

Erik Erikson

A developmental psychologist known for his theory on psychosocial development across the lifespan.

Assimilation

A cognitive process where new information is integrated into existing schemas or concepts.

Accommodation

Adjustments or adaptations made to fit or suit conditions, often relating to living arrangements or visual perception.

Generations

Groups of individuals, born and living at about the same time, who experience similar societal events and cultural shifts that can influence their values and behaviors.