Chapter 60, Added Value

Question 1

Adding Value

Answer 1

the difference between the actual price charged for a product or service and the actual cost of all the components and assembly of the product or service

Question 2

Examples of adding value

Answer 2

• adding value to a house by building extra features

- offering a high standard

Question 3

Usefulness of adding value

Answer 3

• being able to charge a higher price
• higher profits
• enhance the image of the product
• enable a business to target its target market more easily
• good value for money
• shareholders benefit as profits increase