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:

i$.($Click the icon to view the value chain activities.$)$

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

$($i$.)($Click the icon to view the cost drivers.$)$

Read the requirements.

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.$)$

Value$-$chain category

a$.$ Design of products and processes

b$.$ Production

c$.$ Marketing

Activity

Cost driver

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

E$.$ Machine hours required to run the production equipment

More info

A$.$ Perform market research on competing brands

B$.$ Design a prototype of the phone app and the security camera

C$.$ Test the compatability of the phone app and the security camera

D$.$ Make necessary design changes to the prototype based on testing performed in C above.

E$.$ Manufacture the security cameras

F$.$ Attend trade shows to make wholesalers aware of the camera

G$.$ Process orders from the trade show orders and wholesalers

H$.$ Deliver the security cameras to the wholesalers

Provide online assistance to the security camera users

J$.$ Make additional design changes to the security camera based on customer feedback

Requirements

Identify each value$-$chain activity listed at the beginning of the exercise with one of the following value$-$chain categories:

a$.$ Design of products and processes

b$.$ Production

c$.$ Marketing

d$.$ Distribution

e$.$ Customer service

Use the list of preceding cost drivers to find a reasonable cost driver for each of the activities in ATC's value chain.