wjm@lcuxc.UUCP (B. Mitchell) (04/23/85)
A $100 list price difference between a programmable and non-programmable CD player does not imply a $100 difference between manufacturing costs (even manufacturing costs with R & D loaded in) between the two units. I suspect the actual parts price difference may only be $5 or $10 (for the extra buttons and components not on the main control chip - the chips for the two versions are probably identical - they just don't hook up the programming leads on the budget model - to spread the development cost over more units) but then you have the inventory costs of stocking different parts for the two models (that cost the same - like instruction manuals and faceplates - but have to be different for each unit) and the inventory cost for stocking two different models. The small difference in dealer cost gets amplified by the standard percentage markup to give the larger difference in list price. Also, remember that list price is set by the manufacturer's estimate of what will maximize his profits, which is not only related to cost, but also to sales estimates. Regards, Bill Mitchell (ihnp4!lcuxc!wjm)