Suregrip,Inc.features over a dozen models of tires in many different sizes.Two of the models of tires are Ultra and Standard.Tire size LX14 is available in both models.The following information was obtained:
The selling prices include installation costs.Each Ultra tire costs $7 to mount and balance;each Regular tire costs $6 to mount and balance.
a.Compute the unit selling price for the tire only for both single tires and sets of four for each alternative.
b.Was cost the major consideration supporting these prices?
c.What other factors could have influenced these prices?
Definitions:
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