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Requirements 1. If Waterbury prices the motors at $500 eagh, how much operating income will the company make over the product's life cycle? What is
Requirements 1. If Waterbury prices the motors at $500 eagh, how much operating income will the company make over the product's life cycle? What is the operating income per unit? 2. Waterbury is concerned about the operating income it will report in the first sales phase. It is considering pricing the motor at $525 for the first 6 months and decreasing the price to $500 thereafter. With this pricing strategy, Waterbury expects to sell 14,500 units instead of 15,000 units in the first 6 months, 20,000 each year over the next 2 years, and 10,000 over the last 6 months. Assuming the same cost structure given in the problem, which pricing strategy would you recommend? Explain. Print Done
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