Fixed Cost

Variable cost

Market Segment
Large, multidivisional corporations
Corporate R&D and university laboratories
Consultants & professional companies
Small businesses
Students

STUDENT
Large, multidivisional corporations
Price 150
Commission 0
Amount Received 150
Unit contribution 135
Cash Flow 525,000

COMMERCIAL
Large, multidivisional corporations
Price 1200
Commission 0
Amount Received 1200
Cash Flow 5,725,000
15,675,000
INDUSTRIAL
Large, multidivisional corporations
Price 2500
Commission 0
Amount Received 2500
Cash Flow 12,175,000
68,880,000

Best Price
Industrial 600
Commercial 225
Student 50
CAMBRIDGE SOFTWARE CORPORATION

Student
100000
15

Size Segment Development costs ($) WTP (per unit)

5000 150,000 150
2000 100,000 100
20000 200,000 200
15000 200,000 175
500000 300,000 50
542000 950,000

Corporate R&D and university laboratories Consultants & professional companies Small business
100 200 175
0 0 0
100 200 175
85 185 160
70,000 3,500,000 2,200,000

Corporate R&D and university laboratories Consultants & professional companies Small business
1000 300 225
0 0 0
1000 300 225
1,850,000 5,300,000 2,800,000

Corporate R&D and university laboratories Consultants & professional companies Small business
2000 600 300
0 0 0
2000 600 300
3,830,000 49,100,000 3,775,000

Final Contribution
14,805,000
7,750,000
8,020,000
Commercial Industrial
200000 500000
25 35

WTP (per unit) WTP (per unit)

1200 2500
1000 2000
300 600
225 300
60 100

Students
50
0.4
30
15
7,200,000

Students
60
0.4
36
5,200,000

Students
100
0.4
60
12,200,000