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Based on all the data you have on hand, what is your recommended price for the new product? -Show the background financial analysis -Explain the
Based on all the data you have on hand, what is your recommended price for the new product? -Show the background financial analysis -Explain the underlying rationale for your chosen price The Field Test In response to Mid-west's request, Atlas hired a Minneapolis-based electrical engineering firm named Samson Engineering that specializes in testing gearbox components to conduct a comparative analysis of Atlas' and Reliable's gearboxes. Samson conducted an on-site study in Madison County, IA using six of Mid-west's existing windmills. Specifically, for a period of 30 days, they compared Reliable' s conventional gearboxes (3 windmills) with Atlas' gearboxes (3 windmills). The test involved comparing gearbox efficiency and reliability over 40 million gearbox rotations. The results of the comparative analysis were as follows: Reliable Corp. gearbox Atlas Inc. gearbox Total rotations completed by each windmill 40 million 40 million How long did one gearbox last (# rotations)? 12 million 19 million How long did it take to replace the gearbox? 4.0 hours 3.5 hours How much did it cost to replace the gearbox (equipment and labor)? $200/hour $165/hour How much electricity was produced by the windmill per hour? 2 megawatts 2 megawatts Rate at which Mid-west sells its electricity to the
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