Reigel Corporation Is About to Launch a New Product, I51

question 10

Essay

Reigel Corporation is about to launch a new product, I51, whose variable cost is $106.00 per unit and that would require 5.50 centiliters of a key raw material that is the company's constrained resource. The opportunity cost of this raw material is $54.00 per centiliter used.
Required:
What advice would you give to the company concerning the price that should be charged for the new product I51?

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Definitions:

New-Product Strategies

Approaches, methods, or plans developed by businesses to introduce and establish new products in the market successfully.

Product Deletion

The process of permanently removing a product from a company's offerings due to factors like poor sales, obsolescence, or strategic realignment.

Brand Extension

The practice of using an established brand name on a new product category, leveraging the brand's existing reputation and customer base.

Product Category

A broad classification that groups products based on common characteristics or needs.