American Technology Company$($ATC$)$ is developing a new$$ camera$/$security home system to compete with other security systems in the industry. The company will sell the cameras to wholesalers that$$ will, in$$ turn, sell them in retail stores to the final customer. ATC has undertaken the following activities in its value chain to bring its product to$$ market:

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Part $1$

During the process of product$$ development, production,$$ marketing, distribution, and customer$$ service, ATC has kept track of the following cost$$ drivers:

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Part $1$

Requirements $1$ and $2.$ Identify each value chain activity with one of the$$ value$-$chain categories. Select a cost driver for each of the activities in$$ ATC's value chain.

Begin with category a$.$ design of products and$$ processes, then b$.$ production, c$.$ marketing, d$.$ distribution, and finally e$.$ customer service. $($Select only one cost driver for each activity. Choose the best possible cost driver from the choices available. If an input field is not used in the$$ table, leave the input field$$ empty; do not select a$$ label.$)$

Part $2$

Value$-$chain category

Activity

Cost driver

a$.$

Design of products and processes

A$.$

Hours spent researching competing market brands

B$.$

Engineering hours spent on initial product design

C$.$

Number of product tests conducted

D$.$

Number of design changes

J$.$

Number of design changes