Morice Industries Inc

question 51

Multiple Choice

Morice Industries Inc. has developed a new injection mold, model IA-05, that is designed to offer superior performance to a comparable injection mold sold by Morice's main competitor. The competing injection mold sells for $54,000 and needs to be replaced after 1,000 hours of use. It also requires $7,000 of preventive maintenance during its useful life. Model IA-05's performance capabilities are similar to the competing product with two important exceptions-it needs to be replaced only after 2,000 hours of use and it requires $8,000 of preventive maintenance during its useful life.
-From a value-based pricing standpoint what is the reference value that Morice should consider when pricing model IA-05?

• A) $54,000
• B) $68,000
• C) $108,000
• D) $61,000

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Definitions:

Internal Prohibitions

Internalized rules or moral constraints that serve to control or inhibit certain behaviors or desires.

Superego Development

entails the formation of the ethical component of the psyche in psychoanalytic theory, which starts in early childhood and is influenced by parental values and social norms.

Rationalization

A mechanism of defense by means of which unacceptable thoughts or impulses are reinterpreted in more acceptable and, thus, less anxiety-arousing terms.

Repression

A defense mechanism where the mind unconsciously blocks unwanted memories, thoughts, or feelings from conscious awareness.