Schimpf Industries Inc. has developed a new grinder, model WC-13, that is designed to offer superior performance to a comparable grinder sold by Schimpf's main competitor. The competing grinder sells for $70,000 and needs to be replaced after 4,100 hours of use. It also requires $8,200 of preventive maintenance during its useful Model WC-13's performance capabilities are similar to the competing product with two important exceptions-it needs to be replaced only after 16,400 hours of use and it requires $20,500 of preventive maintenance during its useful life. From a value-based pricing standpoint what range of possible prices should Schimpf consider when setting a price for model WC-13? Multiple Choice $70,000 ≤ Value-based price ≤ $292,300 $222,300 ≤ Value-based price ≤ $280,000 $70,000 ≤ Value-based price ≤ $280,000 $222,300 ≤ Value-based price ≤ $292,300

Schimpf Industries Inc. has developed a new grinder, model WC-13, that is designed to offer superior performance to a comparable grinder sold by Schimpf's main competitor. The competing grinder sells for $70,000 and needs to be replaced after 4,100 hours of use. It also requires $8,200 of preventive maintenance during its useful Model WC-13's performance capabilities are similar to the competing product with two important exceptions-it needs to be replaced only after 16,400 hours of use and it requires $20,500 of preventive maintenance during its useful life. From a value-based pricing standpoint what range of possible prices should Schimpf consider when setting a price for model WC-13? Multiple Choice $70,000 ≤ Value-based price ≤ $292,300 $222,300 ≤ Value-based price ≤ $280,000 $70,000 ≤ Value-based price ≤ $280,000 $222,300 ≤ Value-based price ≤ $292,300

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter19: Capital Investment

Section: Chapter Questions

Problem 31P: Jonfran Company manufactures three different models of paper shredders including the waste...

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