MBA 1st Notes 4

MARKETING FOR THE MILLENIUM…
SECTION IV
PRODUCT & PRICING DECISIONS
Product: Concepts of Product Product Planning & Policy
New Product Development Test Marketing
Product Life Cycle Product Mix Decisions
Packaging and Labeling Decisions
Price: Objectives of Pricing Pricing Policies
Pricing Methods Managing Price Changes

12/5/2023 NAVNEET RAWAT
 Product is most important element in
marketing mix. People generally buy product
because they feel product are capable of
serving their needs.
Developing New PRODUCT
Product management is an organizational
lifecycle function within a company dealing
with the planning, forecasting, and
production, or marketing of
a product or products at all stages of
the product life cycle.

 Testing
 Identifying new product candidates
 Gathering the voice of customers
 Defining product requirements
 Determining business-case and feasibility
 Scoping and defining new products at high level
 Evangelizing new products within the company
 Building product roadmaps, particularly technology
roadmaps
 Developing all products on schedule, working to a critical
path
 Ensuring products are within optimal price margins and up to
specifications
 Ensuring products are manufacturable, and optimizing cost
of components and procedures.
 Product Life Cycle considerations
 Product differentiation
 Product naming and branding
 Product positioning and outbound messaging
 Promoting the product externally with press,
customers and partners
 Conducting customer feedback and enabling
(pre-production, beta software)
 Launching new products to market
 Monitoring the competition
 Many refer to inbound (product development) and
outbound (product marketing) functions.
 Inbound product management (aka inbound marketing) is
the "radar" of the organization and involves absorbing
information like customer research, competitive
intelligence, industry analysis, trends, economic signals and
competitive activity as well as documenting requirements
and setting product strategy.
 In comparison, outbound activities are focused on
distributing or pushing messages, training sales people, go
to market strategies and communicating messages
through channels like advertising, PR and events.

 Product concept is the understanding of the
dynamics of the product in order to showcase the best
qualities and maximum features of the product.
Marketers spend a lot of time and research in order to
target their attended audience. Marketers will look
into a product concept before marketing a product
towards their customers.
 While the "product concept" is based upon the idea
that customers prefer products that have the most
quality, performance, and features, some customers
prefer a product that is simpler and easier to use.

 Stage Gate process is a systematic way of
generating, then pruning, a large number of
ideas into a small number of products the firm
successfully launches.
 A gate after each stage where the firm must
make a go/no – go decision.
 Type I error- Investing in a project that
ultimately fails; these error occur when such a
project is allowed to move from one stage to the
next.
 Type II error- Rejecting a project that would have
not succeeded.
 Introduction
 The first of the four product life cycle stages is the
Introduction Stage. Any business that is launching a
new product needs to appreciate that this initial stage
could require significant investment. This isn’t to say
that spending a lot of money at this stage will
guarantee the product’s success. Any investment in
research and new product development has to be
weighed up against the likely return from the new
product, and an effective marketing plan will need to
be developed, in order to give the new product the
best chance of achieving this return.
 Limited competition: If the product is truly original and a business is the
first to manufacture and market it, the lack of direct competition would
be a distinct advantage. Being first could help an organisation to capture
a large market share before other companies start launching competing
products, and in some instances can enable a business’s brand name to
become synonymous with the whole range of products.
 High Price: Manufacturers that are launching a new product are often
able to charge prices that are significantly above what will eventually
become the average market price. This is because early adopters are
prepared to pay this higher price to get their hands on the latest
products, and it allows the company to recoup some of the costs of
developing and launching the product. In some situations however,
manufacturers might do the exact opposite and offer relatively low
prices, in order to stimulate the demand.
 Product Life Cycle Management
The initial stage of the product life cycle is all about building the demand
for the product with the consumer, and establishing the market for the
product. The key emphasis will be on promoting the new product, as well
as making production more cost-effective and developing the right
distribution channels to get the product to market.
 Small or no market: When a new product is launched, there is typically no
market for it, or if a market does exist it is likely to be very small. Naturally
this means that sales are going to be low to start off with. There will be
occasions where a great new product or fantastic marketing campaign will
create such a buzz that sales take off straight away, but these are generally
special cases, and it often takes time and effort before most products
achieve this kind of momentum
 High costs: Very few products are created without some research and
development, and once they are created, many manufacturers will need to
invest in marketing and promotion in order to achieve the kind of demand
that will make their new product a success. Both of these can cost a lot of
money, and in the case of some markets these costs could run into many
millions of dollars.
 Losses, Not Profits: With all the costs of getting a new product to market,
most companies will see negative profits for part of the Initial Stage of the
product life cycle, although the amount and duration of these negative
profits does differ from one market to another. Some manufacturers could
start showing a profit quite quickly, while for companies in other sectors it
could take years.

 The Growth stage is the second of stages in the
product life cycle, and for many manufacturers
this is the key stage for establishing a product’s
position in a market, increasing sales, and
improving profit margins. This is achieved by the
continued development of consumer demand
through the use of marketing and promotional
activity, combined with the reduction of
manufacturing costs. How soon a product moves
from the Introduction stage to the Growth stage,
and how rapidly sales increase, can vary quite a
lot from one market to another.
 Costs are Reduced: With new product development and marketing, the
Introduction stage is usually the most costly phase of a product’s life cycle. In
contrast, the Growth stage can be the most profitable part of the whole cycle for
a manufacturer. As production increases to meet demand, manufacturers are
able to reduce their costs through economies of scale, and established routes to
market will also become a lot more efficient.
 Greater Consumer Awareness: During the Growth phase more and more
consumers will become aware of the new product. This means that the size of the
market will start to increase and there will be a greater demand for the product;
all of which leads to the relatively sharp increase in sales that is characteristic of
the Growth stage.
 Increase in Profits: With lower costs and a significant increase in sales, most
manufacturers will see an increase in profits during the Growth stage, both in
terms of the overall amount of profit they make and the profit margin on each
product they sell.
The standard Product Life Cycle Curve typically shows that profits are at their
highest during the Growth stage. But in order to try and ensure that a product
has as long a life as possible, it is often necessary for manufacturers to reinvest
some of those profits in marketing and promotional activity during this stage, to
help guarantee continued growth and reduce the threat from the competition.

 Increasing Competition: When a company is the first one to introduce a
product into the market, they have the benefit of little or no competition.
However, when the demand for their product starts to increase, and the
company moves into the Growth phase of the product life cycle, they are
likely to face increased competition as new manufacturers look to
benefit from a new, developing market.
 Lower Prices: During the Introduction stage, companies can very often
charge early adopters a premium price for a new product. However, in
response to the growing number of competitors that are likely to enter
the market during the Growth phase, manufacturers may have to lower
their prices in order to achieve the desired increase in sales.
 Different Marketing Approach: Marketing campaigns during the
Introduction stage tend to benefit from all the buzz and hype that
surrounds the launch of a new product. But once the product becomes
established and is no longer ‘new’, a more sophisticated marketing
approach is likely to be needed in order to make the most of the growth
potential of this phase.

 After the Introduction and Growth stages, a
product passes into the Maturity stage. The third
of the product life cycle stages can be quite a
challenging time for manufacturers. In the first
two stages companies try to establish a market
and then grow sales of their product to achieve
as large a share of that market as possible.
However, during the Maturity stage, the primary
focus for most companies will be maintaining
their market share in the face of a number of
different challenges.

 Continued Reduction in Costs: Just as economies of scale in the Growth
stage helped to reduce costs, developments in production can lead to
more efficient ways to manufacture high volumes of a particular product,
helping to lower costs even further.
 Increased Market Share Through Differentiation: While the market
may reach saturation during the Maturity stage, manufacturers might be
able to grow their market share and increase profits in other ways.
Through the use of innovative marketing campaigns and by offering
more diverse product features, companies can actually improve their
market share through differentiation and there are plenty of product life
cycle examples of businesses being able to achieve this.
 Product Life Cycle Management in the Maturity Stage
The Maturity stage of the product life cycle presents manufacturers with
a wide range of challenges. With sales reaching their peak and the
market becoming saturated, it can be very difficult for companies to
maintain their profits, let alone continue trying to increase them,
especially in the face of what is usually fairly intense competition. During
this stage, it is organizations that look for innovative ways to make their
product more appealing to the consumer that will maintain, and perhaps
even increase, their market share.
 Sales Volumes Peak: After the steady increase in sales during the Growth stage,
the market starts to become saturated as there are fewer new customers. The
majority of the consumers who are ever going to purchase the product have
already done so.
 Decreasing Market Share: Another characteristic of the Maturity stage is the
large volume of manufacturers who are all competing for a share of the market.
With this stage of the product life cycle often seeing the highest levels of
competition, it becomes increasingly challenging for companies to maintain their
market share.
 Profits Start to Decrease: While this stage may be when the market as a whole
makes the most profit, it is often the part of the product life cycle where a lot of
manufacturers can start to see their profits decrease. Profits will have to be
shared amongst all of the competitors in the market, and with sales likely to peak
during this stage, any manufacturer that loses market share, and experiences a
fall in sales, is likely to see a subsequent fall in profits. This decrease in profits
could be compounded by the falling prices that are often seen when the sheer
number of competitors forces some of them to try attracting more customers by
competing on price.

 The last of the product life cycle stages is the
Decline stage, which as you might expect is
often the beginning of the end for a product.
When you look at the classic product life cycle
curve, the Decline stage is very clearly
demonstrated by the fall in both sales and
profits. Despite the obvious challenges of this
decline, there may still be opportunities for
manufacturers to continue making a profit
from their product.
 Cheaper Production: Even during the Decline stage, there may be opportunities for some
companies to continue selling their products at a profit, if they are able to reduce their
costs. By looking at alternative manufacturing options, using different techniques, or
moving production to another location, a business may be able to extend the profitable life
of a product.
 Cheaper Markets: For some manufacturers, another way to continue making a profit from
a product during the Decline stage may be to look to new, cheaper markets for sales. In the
past, the profit potential from these markets may not have justified the investment need
to enter them, but companies often see things differently when the only other alternative
might be to withdraw a product altogether.
 Many products going through the Decline stage of the product life cycle will experience a
shrinking market coupled with falling sales and profits. For some companies it will simply
be a case of continuing to manufacture a product as long as it is economically viable, but
withdrawing it as soon as that’s not the case. However, depending on the particular
markets involved, some companies may be able to extend the life of their product and
continue making a profit, by looking at alternative means of production and new, cheaper
markets. Even in the Decline stage, a product can still be viable, and the most successful
manufacturers are those that focus on effective product life cycle management, allowing
them to make the most from the potential of each and every product the company
launches.

 Market in Decline: During this final phase of the product life cycle,
the market for a product will start to decline. Consumers will
typically stop buying this product in favour of something newer
and better, and there’s generally not much a manufacturer will be
able to do to prevent this.
 Falling Sales and Profits: As a result of the declining market, sales
will start to fall, and the overall profit that is available to the
manufacturers in the market will start to decrease. One way for
companies to slow this fall in sales and profits is to try and increase
their market share which, while challenging enough during the
Maturity stage of the cycle, can be even harder when a market is in
decline.
 Product Withdrawal: Ultimately, for a lot of manufacturers it could
get to a point where they are no longer making a profit from their
product. As there may be no way to reverse this decline, the only
option many business will have is to withdraw their product before
it starts to lose them money.

PRODUCTS
Consumer Industrial
Services
Products Products
48
 Business product
 Consumer product
 Technology products
 Commodity Products
 Customized products
A specific version of a product
Product Item that can be designated as a
distinct offering among an organization’s products.
A group of closely-related
Product Line
product items.
All products that an

Product Mix
organization sells.
50
Width – how many product lines a company has
Length – how many products are there in a product line
Depth – how many variants of each product exist within a
product line
Consistency – how closely related the product lines are in end
use
51
 Product mix is the sum total of all products that a
company offers. For example, a pet food
manufacturer may offer several varieties of dog
and cat food. These multiple products may serve
different customers, dog and cat owners, but the
products are all part of the company's product mix.
Products within a product mix can either be similar
or variegated. There are also following dimensions
to product mix: width, length.
 Width
 The width of product mix includes all the product lines
that a company sells. For example, if a vitamin company
sells various vitamins, diet products and sports drinks, its
product width is three
 Length
 The length of a company's product mix pertains to the
total number of products the company sells, For example,
a small consumer products company may have three
product lines: snacks, cereal and canned meats. This
consumer products company may sell five snack items,
four cereals and three varieties of canned meats.
Therefore, the company's product mix length is 12
 Depth:-A company's product mix depth pertains
to the total number of variations for each product.
.Product variation can include flavor, fragrance,
size and any other salient attribute. For example, if
a small pastry manufacturer sells three flavors of
pastries and two sizes of each flavor, the product
depth is six.
 Packaging and Labeling The way you package
and label your product is important. First,
packaging protects it from physical, chemical
and microbiological invasion. The package
also provides a medium for presenting
advertising messages and other important
information to the consumer. And finally, the
package is one of the greatest influences on a
consumer's decision to try your product.
 Definition: The wrapping material around a
consumer item that serves to contain, identify,
describe, protect, display, promote and
otherwise make the product marketable and
keep it clean .

 Primary packaging or sales packaging
 This is any packaging that is conceived so as
to constitute, for the end-user or the
consumer at the POS, a complete integral
package. It concerns, for example a type of
packaging that directly encloses the product,
such as a small bottle or a can for soft and
fizzy drinks.

 This is any packaging that is conceived so as to
constitute, at the POS, a number of sellable
units (primary packaging), regardless of whether
the secondary packaging is sold, as such, to the
end-user or consumer or whether it serves only
as a means to replenish the shelves at the POS;
it may be removed from the product without
affecting its characteristics. It concerns, for
example, the plastic packaging around 6 bottles
of soft or fizzy drink.

 This is any packaging that is conceived so as
to facilitate the safe handling and transport
of a number of sellable units or grouped
packaging, in order to prevent physical
damage due to incorrect handling or
transport. Transport packaging does not
include road, rail, ship or air containers. It
concerns, for example, pallets or (heavy)
wooden crates.
 You may be required to include certain information on the
label of your product when it is distributed in specific
ways. For example, labels of food products sold in retail
outlets must contain information about their ingredients
and nutritional value.
 High quality labeling, like packaging, requires research,
planning and consultation from a variety of sources. As
well, package and label design must be integrated. It's
important that they both send the same message to the
consumer. Your ultimate goal is to produce a label that is
educational and user-friendly. It should also adequately
market your product within legal specifications. And, of
course, your label needs to be an integrated part of your
strategic marketing approach.

 Great packaging label design includes these
design considerations: selecting a standard
packaging label size that fits your design
requirements and incorporating full color
graphics to support brand requirements and give
your packaging the most eye catching look
possible.
 Labeling Shapes and Sizes
 Labeling Print Materials
 Ingredient Listing
 Universal Product Codes
 Other Points About Labeling
 These regulations may be called the Food Safety and
Standards (Packaging and labelling) Regulations, 2011.
 These regulations shall come into force on or after 5th
August, 2011.
 1. “Best before” means the date which signifies the end of
the period under any stated storage conditions during
which the food shall remain fully marketable and shall
retain any specific qualities for which tacit or express
claims have been made and beyond that date, the food
may still be perfectly safe to consume, though its quality
may have diminished. However the food shall not be sold
if at any stage the product becomes unsafe.

 2. “Date of manufacture” means the date on which the food
becomes the product as described.
 3. “Date of packaging” means the date on which the food is placed
in the immediate container in which it will be ultimately sold;
 4. “Infant” means a child not more than twelve months of age;
 5. “Lot number” or “code number” or “batch number” means the
number either in numericals or alphabets or in combination
thereof, representing the lot number or code number or batch
number, being preceded by the words “Lot No” or “Lot” or “code
number” or “Code” or Batch No” or “Batch” or any distinguishing
prefix by which the food can be traced in manufacture and
identified in distribution.
 6. “Multipiece package” means a package containing two or more
individually packaged or labelled pieces of the same commodity of
identical quantity, intended for retail either in individual pieces or
packages as a whole.

 7. “Non- Vegetarian Food” means an article of food which contains
whole or part of any animal including birds, fresh water or marine
animals or eggs or products of any animal origin, but excluding
milk or milk products, as an ingredient;
 8. “Vegetarian Food” means any article of Food other than Non-
Vegetarian Food as defined in regulation 1.2.1 (7).
 9. “Prepackaged” or “Pre-packed food”, means food, which is
placed in a package of any nature, in such a manner that the
contents cannot be changed without tampering it and which is
ready for sale to the consumer.
 10. “Use – by date” or “Recommended last consumption date” or
“Expiry date” means the date which signifies the end of the
estimated period under any stated storage conditions, after which
the food probably will not have the quality and safety attributes
normally expected by the consumers and the food shall not be
sold;

Price is the assigned numerical monetary value
that one puts on the utility that one receives for
goods and services. Price in our society is
generally a monetary expression and is the value
assigned to a bundle of form, time, place and
possession utility. The price set serves as the
basis of exchange and is thus an index of value
for goods and services. price of new product is
critical and new product must be priced
according to what the market will bear.

Correct and incorrect price has direct bearing on
success or failure of the product. Mostly consider
cost-plus price which recovers all costs and puts
a mark up. Competitive pricing is the other most
widely practiced method of setting the prices.
Pricing is the strategic process of applying value
to purchase and sales order. Marketing
management must address all queries related to
pricing. Now a days Value base pricing is in
demand.

 The relative value of an offer determines
what the market cab bear. More than this
people won’t pay.
 Value Pricing is also called value-in use

pricing. Here a price is assigned to a product
based upon its value to the consumer in use
of the product.

 A brand should not be underpriced in relation
to its quality and reputation. At the same
time a brand should not be over-priced which
is too high for the consumer. Product
differential can be set to charge extra price.
 Brand image is relevant in pricing. It enables a
company to introduce product at premium
price though they are only slightly better than
existing products.
 The whole pricing package that we have to device so as to
keep working towards profitability and corporate gains.
 We must consider:
1. The Company Objective (Financial, Marketing & Strategy
Objective of the company).
2. Price Elasticity (Economic Concept).
3. Maximizing Long term & Short term profit.
4. To increase Sales Volume & Market share.
5. Market Stability.
6. Maintain Price Leadership.
7. Avoid Government Intervention/ Investigation.
8. Obtain & maintain the loyalty in network marketing.
9. Social Ethical or Ideological Objectives.
10. Competitive Advantage

 Skimming and Penetration Pricing
 Price Discrimination, Variable Pricing, Dynamic
Pricing, Fixed Pricing or Flat Rate Pricing
 Customer Driven Pricing
 Auction Pricing
 Psychological Pricing
 Complementary Product Pricing
 Gray Market Pricing
 Pay-what-you want Pricing
 Government Pricing
 Tactical Pricing
 Discounting Pricing

 DEFINITION of 'Customer-Driven Pricing' A
method of pricing in which the seller makes a
decision based on what the customer can
justify paying. Customer-driven pricing is not
simply what the consumer is willing to pay,
but reflects the value of the product or
service from the consumer's perspective. So
we have to define or find out customer
perceived value.
 To optimize pricing, companies need to consider
how to best segment the market so that prices
reflect the differences in value perceived by
different types of consumers. To do this,
companies must ensure that there is a
comprehensive understanding of the customer
and what he or she values.
 A company would make the most money if they
could figure out the maximum each customer
would pay, and charge them that amount.

 Creating Value: The firm creates value in its
offer primarily through non-price elements in
the marketing mix
 Measuring Value: Measuring the value
customers perceive in firm and competitor
offers is critical. Approach are: Direct Value
Assessment & Rupeemetric Method.
 Perceived Value

OPTION COMPARED PREFERRED OPTION EXTRA PRICE FOR
PREFERRED OPTION
A AND B B 600
A AND C C 780
A AND D A 300
B AND C C 180
B AND D B 480
C AND D C 720

Responses for four products: A,B,C, & D
 We calculate the Customer’s relative Value for these
options as follows:
 The extra price is positive for the preferred option,
negative for the non-preferred option.
 Each option has three comparisons. Sum these extra
prices for each option.
 Divide the sums of extra prices by three to calculate
the average extra price.
 Using the least valued as a base, find the difference
between the base and the average extra price for each
option. This figure is what the customer would pay
over the base.
 We calculate the customer’s relative Value for
these options as follows:
 The average extra prices customers are
prepared to pay for the four options are:
 A = -600-780+300 = -1080/3 = -360
 B = 600-180+480 = 900/3 = +300
 C = +780+180+170 = 1680/3 = +560
 D = -300-400-720 = -1500/3 = -500

 Using the least valued option as a base, find the
difference between the base and the average
extra price for each option. This figure is what
the customer would pay over the base.
 D is the least valued option so the base is -500.
the extra prices for the other options are:
 A = (-360) – (-500) = 140
 B= 300 – (-500) = 800
 C= 560 – (-500) = 1060

BENEFIT RELATIVE SUPLIER A SUPLIER B SUPLIER C
REQUIRED IMPORTANCE PRICE=5,000 PRICE=4,500 PRICE=3,000
WEIGHTING RATING TOTAL RATING TOTAL RATING TOTAL
(1-10) (1-10) (1-10)
CHAIR DESIGN 20 5 100 7 140 6 120
COMFORT 30 6 180 8 240 4 120
FABRIC QUALITY 15 10 150 9 135 8 120
FABRIC DESIGN 15 5 75 7 105 4 60
EASE OF 20 8 160 10 200 8 160

PURCHASE
GRAND TOTAL 100 665 820 580

 A,B, & C represent three different suppliers of easy chairs. The
results and interpretation are:
 Perceived Value: supplier B at Rs 820 offers the greatest perceived
value, followed by A-665 and C-580.
 Price: supplier A has the highest price – Rs. 5,000; followed by B-
Rs, 4,500 and C-Rs. 3,000.
 Supplier C has the lowest perceived value and the lowest price, but
A and B are misordered. Supplier B has the greatest perceived
value -820 versus 665 for supplier A. But supplier A’s price is higher
– Rs 5,000 versus Rs 4,500. since supplier B provides greater value
for a lower price, it should be gaining market share.

 Costs are important for setting prices. After
all, costs represent one-half of the profit
equation: profit=sales revenues-costs. Cost
plus pricing is a pricing methodology used by
many firms. Despite its popularity, it is the
wrong way to set prices. Cost plus pricing
proceeds simply by identifying product costs,
then adding a pre-determined profit
margin(mark up).
 Profitability:
 All sales seem profitable as price must, by
definition, be above cost.
 Simplicity:
 If the firm knows its costs, pricing is simple.
Anyone can do the math.
 Defensibility:
 Legally acceptable and often required for
government and other cost-plus contracts.
S. NO. Costs Price
1. Variable Costs Rs. 4,00,000
2. Total Fixed Costs Rs. 3,00,000
3. Total Costs Rs. 7,00,000
4. Standard mark-up: 15% of costs Rs. 1,05,000
5. Price Rs. 8,05,000

Pr ice (a) Estimated Sales Revenue Estimated Profits
Unit Sales (c=a x b) Cost (d) (e= c - d)
Volume (b)
480 650 2,88,000
600 500 270,000
720 400 246,000
840 300 222,000

 The firm should always consider competitor
price. Basing the firm’s price on competitor
prices is legal and ensure price parity, but
focusing too heavily on competitor pricing
strategies has distinct disadvantage.
 Maintain Price Leadership
 Discourage New entrants
 Sustainable Competitive Advantage.

 Competitive pricing is setting the price of a
product or service based on what the
competition is charging. Competitive
pricing is used more often by businesses
selling similar products, since services can
vary from business to business while the
attributes of a product remain similar.

 Competition-based pricing is the second-most-
popular price-setting approach. Managers sometimes
refer to this approach as strategic pricing, although
it's not particularly strategic. When taking this
approach, a firm simply checks out its competition's
price and then sets the price of its own product at
about the same level, plus or minus a few percent.
Once again, this approach has the virtue of being
simple: It's an easy way to make a pricing decision
without having to conduct any thorough market
research. It also seems relatively safe: By setting a
price close to the rival's and adjusting with it, a firm
does not risk losing its market share to the
competition.

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MARKETING FOR THE MILLENIUM…

Product: Concepts of Product Product Planning & Policy

New Product Development Test Marketing

Product Life Cycle Product Mix Decisions

Packaging and Labeling Decisions

Price: Objectives of Pricing Pricing Policies

Pricing Methods Managing Price Changes

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All products that an

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 Value Pricing is also called value-in use

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CHAIR DESIGN 20 5 100 7 140 6 120

COMFORT 30 6 180 8 240 4 120

FABRIC QUALITY 15 10 150 9 135 8 120

FABRIC DESIGN 15 5 75 7 105 4 60

EASE OF 20 8 160 10 200 8 160

GRAND TOTAL 100 665 820 580

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1. Variable Costs Rs. 4,00,000

2. Total Fixed Costs Rs. 3,00,000

3. Total Costs Rs. 7,00,000

4. Standard mark-up: 15% of costs Rs. 1,05,000

5. Price Rs. 8,05,000

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480 650 2,88,000

600 500 270,000

720 400 246,000

840 300 222,000

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