Question 20 "So, son, what is about your motorcycle?" "Yes, Papa, I would buy a Harley Davidson?" "Why, isn't that a hea
Posted: Wed Apr 27, 2022 12:11 pm
Question 20
"So, son, what is about your motorcycle?"
"Yes, Papa, I would buy a Harley Davidson?"
"Why, isn't that a heavy bike? Why don't you buy a Hero Moto
Corp bike?"
The teenager's mother, the Lady of the house, found the comment
very amusing.
"He is studying at St. Adam's College. No one goes there in
anything less than a Harley."
"That is what you have been doing all these years." The man
turned to his wife. "His grades have gone down. Most of the time,
he is not at home. I don't see his face for weeks. And now this
motorcycle thing."
"Ok." He looked at his son. "What is the cost of the bike?"
"Rs. 15 lakh."
"What? We can buy a luxury car with that amount of money." The
man growled.
"A Harley is a Harley, Papa. It comes with a 1250 cc engine,
six-speed manual transmission gearbox, and alloy wheels. It
produces a rocking 121 brake horsepower. I am talking about the
Sportster model. By contrast, the Toyota Corolla Altis you drive
produces only 87 brake horsepower," The teenager said.
"Son, had you answered the JEE question paper with the skill you
just spoke about your bike, you would have been in one of the
IITs."
"By the way, have you checked the mileage? Something tells me I
would be the one paying for the petrol."
"Of course, Harleys don't give the same mileage as the low-grade
bikes. I think it is about 20 kilometers per liter."
'Is that all?" The man asked, looking incredulously at his son.
"Do you realize that I only had a rickety Humber bicycle at your
age?"
"We have the accessories, Papa." The young man continued
ignoring his father's comment. "A leg guard would cost Rs. 5000.
Two side mirrors would cost Rs. 2000. I am also thinking of a
Harley branded helmet which would cost Rs. 5000. Harley believes in
creating a brand community for which they also sell leather jackets
for Rs. 20000. Genuine Leather."
"And GST?" The older man asked.
"That is included, Dad. I have checked up with the dealer. His
son is my batchmate at the college. He would not charge GST." The
son had missed the sarcasm in the father's voice.
"What is left out, son? Have you checked the cost of spares? I
am sure they would be as reasonable as the other prices you
mentioned. While you are at it, check the period required to get
spares? Do we have a sufficient number of technicians in the city
to repair these motorcycles? If that big a motorcycle stops, you
cannot even push it to a nearby mechanic."
"By the way," the man turned towards his wife, "you have been
indulging him. It is your responsibility to ensure he works on his
studies. Also, ensure he stays safe also."
Which of the following represents an instance of captive
pricing?
Select one:
a. Cost of the motor cycle (Rs. 15 lakh)
b. Cost of accessories
c. Cost of fuel (mileage)
d. Cost of spares
"So, son, what is about your motorcycle?"
"Yes, Papa, I would buy a Harley Davidson?"
"Why, isn't that a heavy bike? Why don't you buy a Hero Moto
Corp bike?"
The teenager's mother, the Lady of the house, found the comment
very amusing.
"He is studying at St. Adam's College. No one goes there in
anything less than a Harley."
"That is what you have been doing all these years." The man
turned to his wife. "His grades have gone down. Most of the time,
he is not at home. I don't see his face for weeks. And now this
motorcycle thing."
"Ok." He looked at his son. "What is the cost of the bike?"
"Rs. 15 lakh."
"What? We can buy a luxury car with that amount of money." The
man growled.
"A Harley is a Harley, Papa. It comes with a 1250 cc engine,
six-speed manual transmission gearbox, and alloy wheels. It
produces a rocking 121 brake horsepower. I am talking about the
Sportster model. By contrast, the Toyota Corolla Altis you drive
produces only 87 brake horsepower," The teenager said.
"Son, had you answered the JEE question paper with the skill you
just spoke about your bike, you would have been in one of the
IITs."
"By the way, have you checked the mileage? Something tells me I
would be the one paying for the petrol."
"Of course, Harleys don't give the same mileage as the low-grade
bikes. I think it is about 20 kilometers per liter."
'Is that all?" The man asked, looking incredulously at his son.
"Do you realize that I only had a rickety Humber bicycle at your
age?"
"We have the accessories, Papa." The young man continued
ignoring his father's comment. "A leg guard would cost Rs. 5000.
Two side mirrors would cost Rs. 2000. I am also thinking of a
Harley branded helmet which would cost Rs. 5000. Harley believes in
creating a brand community for which they also sell leather jackets
for Rs. 20000. Genuine Leather."
"And GST?" The older man asked.
"That is included, Dad. I have checked up with the dealer. His
son is my batchmate at the college. He would not charge GST." The
son had missed the sarcasm in the father's voice.
"What is left out, son? Have you checked the cost of spares? I
am sure they would be as reasonable as the other prices you
mentioned. While you are at it, check the period required to get
spares? Do we have a sufficient number of technicians in the city
to repair these motorcycles? If that big a motorcycle stops, you
cannot even push it to a nearby mechanic."
"By the way," the man turned towards his wife, "you have been
indulging him. It is your responsibility to ensure he works on his
studies. Also, ensure he stays safe also."
Which of the following represents an instance of captive
pricing?
Select one:
a. Cost of the motor cycle (Rs. 15 lakh)
b. Cost of accessories
c. Cost of fuel (mileage)
d. Cost of spares