When Microwave Ovens Were Being Developed in the 1980s,they Represented

question 111

Multiple Choice

When microwave ovens were being developed in the 1980s,they represented such a radical concept that the company was unsure about pricing.Early prototypes were large,cumbersome and would need a price tag of thousands of dollars simply to breakeven.With remarkable insight,a new divisional manager took over the project and issued the development team with a very clear design brief.The new microwave was to be shaped like an air-conditioner,should look like an oven,have buttons like an oven and be priced around the same as a conventional oven (at the time around $500) .The company would not commercialise until the development team could design a microwave at this price.This is an example of which type of costing?

• A)variable costing
• B)cost-plus
• C)target costing
• D)standard mark up
• E)None of the above.

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Definitions:

Wording

The choice and arrangement of words in speech or writing, which can significantly affect communication effectiveness and interpretation.

Cognitive Dissonance

A psychological phenomenon where there is discomfort or distress from holding two conflicting beliefs or attitudes.

Cognitive Dissonance

The mental discomfort experienced by a person who holds two or more contradictory beliefs, ideas, or values at the same time.

Festinger & Carlsmith

Researchers known for their 1959 study on cognitive dissonance, which investigated the effects of forced compliance behavior on attitude change.