Managing warranty goodwill

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By Michael Paczolt | 30 September 2010

In today's business world, reputation is everything, but how much should companies pay to protect theirs? The tight economy has let many firms to reduce the amount of warranty goodwill they pay. In this Contingencies article, Milliman's Michael Paczolt sets forth a model that can be used to determine the amount of warranty goodwill that will maximize firm value.