FR Wilk HFM5 Conversion
08-09-2005, 07:14 PM
#16
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Originally Posted by JustinL
That really is the question isn't it... If he halves the price of the unit as you suggest he would need twice the orders to maintain the same revenue. But revenue is only half of the equation. If he sells twice as many units at the same marginal cost he could nearly double his variable costs.
If my shaky grasp of microeconomics doesn't let me down here, the downward sloping demand curve creates a parabolic shaped revenue curve and likely a somewhat linear cost curve over the relevant range (only 100ish units). Revenue less expenses gives profit.
Anyway... my point is, from FRwilk's perspective there is an optimum price and it's unlikely that halving the price is in HIS best interests.
Justin
If my shaky grasp of microeconomics doesn't let me down here, the downward sloping demand curve creates a parabolic shaped revenue curve and likely a somewhat linear cost curve over the relevant range (only 100ish units). Revenue less expenses gives profit.
Anyway... my point is, from FRwilk's perspective there is an optimum price and it's unlikely that halving the price is in HIS best interests.
Justin
08-09-2005, 08:17 PM
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Campeck, $600 is more than fair for a quality product for a PORSCHE - especially one backed by his reputation. It's a free market out there; if you think you can develop one for less, by all means - go for it!
Personally if I weren't going to be turbo-izing my 944 I'd buy one of those (along with his chips) in a heartbeat. I have the utmost in admiration and respect for the guy in that he's done so much to support the "lowly" early n/a cars, which obviously he and I share a love for. . . The market for these cars in general - ESPECIALLY the n/a cars - is so soft, the price is going to be a bit high, but I honestly don't mind paying for a good quality product.
These are Porsches, not Ford Focuses.
Personally if I weren't going to be turbo-izing my 944 I'd buy one of those (along with his chips) in a heartbeat. I have the utmost in admiration and respect for the guy in that he's done so much to support the "lowly" early n/a cars, which obviously he and I share a love for. . . The market for these cars in general - ESPECIALLY the n/a cars - is so soft, the price is going to be a bit high, but I honestly don't mind paying for a good quality product.
These are Porsches, not Ford Focuses.
