Question

Pfizer Inc., a pharmaceutical firm, Incurs many types of costs in its operations. Required: For each cost in the following table, identify the stage in the value chain where this cost is Incurred. Cost Stage In the Value Chain Salaries for employees to develop most efficient dropper to administer drug. Cost of chemicals to make the drug Cost to visit doctor to explain the value of the drug. Expenses to deliver products to customers. Laboratory experiments to evaluate drug effectiveness. Employee costs to work with hospitals to ensure adequate supplies.

Answer 1

1) Salaries for employees to develop most efficient dropper to administer drug. - Design

2) Costs of chemicals to make the drug. - Production

3) Costs to visit doctors to explain value of drug. - Marketing

4) Expenses to deliver product to customers. - Distribution

5) Laboratory experiments to evaluate drug effectiveness. - Research and development

6) Employee costs to work with hospitals to ensure adequate delivery supplies. - Customer Service