Tavis Robotics Corporation Has Developed a New Robot-Model FI-73-That Has

question 127

Multiple Choice

Tavis Robotics Corporation has developed a new robot-model FI-73-that has been designed to outperform a competitor's best-selling robot. The competitor's product has a useful life of 10,000 hours of service, has operating costs that average $4.60 per hour, and sells for $109,000. In contrast, model FI-73 has a useful life of 30,000 hours of service and its operating cost is $2.60 per hour. Tavis has not yet established a selling price for model FI-73.
-From a value-based pricing standpoint what range of possible prices should Tavis consider when setting a price for FI-73?

• A) $187,000 ≤ Value-based price ≤ $278,000
• B) $109,000 ≤ Value-based price ≤ $187,000
• C) $109,000 ≤ Value-based price ≤ $387,000
• D) $278,000 ≤ Value-based price ≤ $387,000

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Definitions:

Government Purchases

Government purchases involve the spending by government entities on goods and services, including investments in public infrastructure, which can influence economic activity.

Transfer Payments

Payments made by the government to individuals or entities without any service or goods being received in return, such as social security benefits.

Property Tax

Taxes levied by governments on property owners based on the value of their property, including land and buildings.

Regressive

Pertaining to a tax system where the tax rate decreases as the taxable amount increases, leading to a higher tax burden on lower-income earners.