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Answers to supplementary objective test questions

3.3 A

The original life cycle cost per unit = ($43,000 + (20,000 × $15) +
$30,000)/20,000 = $18.65

3.4 C

The customer is valuing the function performed by the car – its ability to provide
transportation – this is known as use value. Cost value is the production cost.
Exchange value is the purchase price. Esteem value is related to the increase
in status associated with owning the product.

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