Walker Consulting helped McCall Roofers put various cost saving techniques into place. The contract specifies that Walker will receive a flat fee of $60,000 and an additional $15,000 if McCall attains a target amount of cost savings. Walker estimates a 20% chance that McCall will reach the target for cost savings. Assuming that Walker uses the expected minus value approach, what is the transaction price for this product?

A. $63,000

B. $15,000

C. $60,000

D. $75,000

Answer rating: 100% (QA)

Flat fee 60000 Additional fee if target amount of cost savings is achieve... View the full answer