For your company’s solution

a. Using value-based pricing, estimate your sales price and your net sales per unit. For your first year after first shipments to customers, estimate your average variable cost per unit and total fixed costs. Calculate your first-year breakeven point in both units and revenue.

b. Forecast your unit sales for half a dozen or so prices ranging from half to double your estimated retail price. At what price do you maximize your gross profit and what is your operating profit at that price?

AppendixLO1