The tuff wheels was getting ready to start its development, Ask an Expert

Management Studies

The Tuff Wheels was getting ready to start its development project for a new product to be added to their small motorized vehicle line for children. The new product is called the Kiddy Dozer. It will look like a miniature bulldozer, complete with caterpillar tracks and a blade. Tuff Wheels has forecasted the demand and the cost to develop and produce the new Kiddy Dozer. The table below contains the relevant information for this project.

Development Cost $ 1,020,000

Estimated Development Time 9 months

Pilot Testing $ 190,000

Ramp-up Cost $ 420,000

Marketing and Support Cost $ 156,000 per year

Sales and Production Volume 68,000 per year

Unit Production Cost $ 83

Unit Price $ 176

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