Copyright

Recently Walmart has offered a wireless data contract based on bandwidth used, with a minimum...

Question:

Recently Walmart has offered a wireless data contract based on bandwidth used, with a minimum monthly charge of $40 for up to 5 gigabytes (GB) of use. Additional GB can be purchased at the following rates: $11 for an additional 1 GB, $28 for an additional 3 GB, and $43 for a capacity of 10 GB. What is the cost for a user who is expecting to use 9 GB?

Usage-based Pricing

Usage-based pricing is a pricing strategy that offers prospective customers and current users to pay only for their actual consumption instead of paying a fixed amount regardless of usage. With this pricing strategy customers are able to afford the cost of service and encourages to consume within their means.

Answer and Explanation: 1

Become a Study.com member to unlock this answer! Create your account

View this answer


Answer: The cost for a user expecting to use 9 GB is $79.

For a usage of 9 GB, the minimum monthly charge is $40 for a maximum usage of 5 GB. So,...

See full answer below.


Learn more about this topic:

Loading...
Cost Accounting Practices for Pricing Decisions

from

Chapter 14 / Lesson 4
5.8K

Cost accounting directly influences pricing decisions by including various types of costs. See how inventory, fixed, and variable costs are considered when implementing a pricing strategy and adjusting to changes in sales volume.


Related to this Question

Explore our homework questions and answers library