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In this paper, we study how the heterogeneous consumer valuation of product quality influences the firm's product variety decisions, i.e. (a) the product variety in a product line; (b) the quality of every individual product; and (c) the product prices. First we consider in our analysis a simple uniform consumer valuation distribution (CVD). Then we shift to more complex CVDs such as the triangular...
In the face of shorter product life cycles, designing products with modular component parts can shorten product development time and speed up the introduction of new products in the market. Utilizing stylized models, we examine the reuse/redesign, quality, speed-to-market, and marketing decisions for two consecutive generations of a multicomponent modular product. With modularity that assumes a stable...
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