"The Reciprocity Norm Is So Powerful That It Even Applies

question 3

Essay

"The reciprocity norm is so powerful that it even applies to situations in which you do not ask for the favor." Explain this statement with an example.

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Definitions:

External Failure Cost

Costs associated with defects found after the product is delivered to the customer, including returns and warranties.

Prevention Cost

Expenses incurred to avoid or minimize the number of defects in products, including costs associated with quality control and training.

Life Cycle Costing

An approach that considers all the costs associated with the lifecycle of a product or asset, from acquisition through disposal, aimed at understanding the total cost of ownership.

Target Costing

A pricing method in which market prices determine the cost constraints for product development, aiming to ensure competitiveness and profitability.