Cassidy Products Inc.is considering eliminating Model EOS1 from its product line because of losses over the past quarter. The past three months of information for model EOS1 is summarized below:
Support costs are 70% variable and the remaining 30% is depreciation of special equipment for model EOS1 that has no resale value.
Should Cassidy eliminate Model EOS1 from its product line? Why or why not?
Definitions:
Dishabituation
A process in which a previously habituated response reoccurs, typically after the presentation of a novel stimulus.
Sensitization
An increased reaction to a stimulus following repeated exposures, leading to a heightened response.
Habituation
The process where an organism becomes less responsive to a stimulus after repeated exposure.
Behavioral Contrast
A phenomenon where the rate of response varies according to the reinforcement conditions of another behavior.
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