3. Suppose EMU Software is promoting its new tax preparation software. Its main competing product is Turbotaxâ€™s...

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3. Suppose EMU Software is promoting its new tax preparationsoftware. Its main competing
product is Turbotaxâ€™s software worth $50. EMU claims that for30% of the time, its software
identifies additional savings of $110 for their customerscompared to its closest competitor.
Also, EMUâ€™s software is easier to use and it takes only 3 hoursfor its customer to use to
complete all its tax preparations. Turbotaxâ€™s software on theother hand takes 4 hours to do
the same. However, EMU Software is a new product and 5% of theircustomers may
experience a bug in the software. The delay in sorting that bugout will lead to an extra day
required for tax preparation using EMU Software for thosecustomers. Assume that a typical
company accountant who would be hired to use the software earns$40 per hour. Calculate
the total economic value of EMUâ€™s software. Note that one day is8 working hours. (10
points)

Answer & Explanation Solved by verified expert

3.8 Ratings (652 Votes)

Worth of Turbotax software 50 Expected Value of additional savings identified by EMU 11030 33 Time taken by EMU software to complete tax preparations 3 hours Time taken See Answer

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