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May 22, 2024

Price Equation Calculation

“In April 2010, Apple introduced the iPad. Unique to this tablet device was its iOS multitouch user interface borrowed from its hugely successful Apple iPhone, which was launched 3 years earlier to much acclaim. The iPad focused on media consumption (reading e-books, watching YouTube videos, etc.) and Internet usage (browsing news sites and viewing/responding to e-mail, etc.). The late Steve Jobs has referred to the iPad as ushering in the ‘Post PC Era.’

The iPad Air was launched in October 2013 and weighs just one pound. It has a 9.7″ screen that uses Retina Display technology, which provides HD quality format with 10 hours of battery life. It also has a 5-megapixel iSight camera for FaceTime video calling, picture taking, and HD video recording. In addition, the iPad Air has next generation wireless technology for high-speed communication-iCloud, Internet browsing, video downloads, and e-mail. The iPad Air comes in either Black/Space Gray or White/Silver finishes.

“The price equation consists of all the factors that raise or lower the final price consumers pay for a product or service. These factors include (1) any incentives (discounts, rebates, special offers) and allowances, which are subtracted from the list price, as well as (2) any extra fees or charges (shipping & handling charges, delivery charges, sales taxes, finance charges, and others) that are added to the list price at the time of purchase. Thus, the price equation is presented as follows:

Final price = List price – (Incentives + Allowances) + Extra fees/charges

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