Section 3.) Special Order Pricing Decision Another decision that managers need to make on occasion is the decision as to whether to accept a special order. For our purposes, these “special orders” are orders that are outside of the standard customer base, and they are usually proposals for a short term deeply discounted price. For example, a customer from out of town may propose to buy 1,000 units of the company’s product at a rate of $18, even though the current market rate is much higher (e.g., $30.) In most cases, the price difference is severe enough to cause a student to question right off the bat whether the order makes any sense at all. Of course, the main determining factor as to whether to accept the special offer is simply whether doing so will increase profit or not. This type of decision focuses heavily on relevant costs. We must review all the costs that are given in the problem to determine which ones are relevant. For example, differential costs will be relevant because ...