Transrapid is a new magnetically levitated train being developed to run between major cities in Germany at a speed of 300 miles per hour. Engineers developed a system with trains departing every 10 minutes. Suppose Transrapid asked you to research customer preferences and to recommend a pricing policy. It costs considerably more to have trains depart as frequently as 10 minutes apart, so a cost-based pricing schedule will result in ticket prices that are considerably higher than alternative modes of transportation.

REQUIRED

A. In addition to customer preferences, what information would you like to gather before recommending a pricing policy? Explain why each item you list is relevant.

B. Explain why it is important to understand customer preferences before building the system.

C. Is the need to consider customer preferences different for this organization than for another type of organization? Why or why not?