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How Much Will You Pay For An iPad Mini?

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It now seems likely that Apple will finally put fanboys and pundits out of their misery and lift the veil on the iPad mini next Tuesday. This device is expected to be a standard iPad hit with a shrink ray, making the tablet better suited for carrying around and sliding into handbags.

Given that the iPad 3 starts at $499, and the iPad 2 is $100 cheaper, how much would you be willing to pay for less screen?

If you want a small tablet, one that's well suited for tasks such as answering email, browsing the web, watching videos on YouTube, playing games, and reading ebooks, then you can already choose between the Amazon Kindle Fire HD or Google's Nexus 7, both of which start at $199. Given that Amazon has admitted that it doesn't make a dime on the sale of the Kindle Fire HD, it's unlikely that Apple is going to slash its own wrists to bring the iPad mini to market at a break-even price.

Slashing prices isn't how Apple has ended up with over $110 billion in cash in the back and zero debt.

If you want a cheap tablet, and you're holding out hope that the iPad mini will start at $199, you're going to be disappointed, and you may as well buy a Kindle Fire HD or Nexus 7 now, because you're not going to get an iPad mini for that money.

You can even pick up a first-generation Kindle Fire -- a decent enough tablet -- for $159.

Apple's profit margin on products is traditionally in the region of 30 percent. That means that if Apple could make a tablet for $199, then that tablet would sell for around $250 to $300.

It is this $250 to $300 price range that I expect the iPad mini to come in at. I expect it to come in three storage capacities -- 16GB, 32GB, and 64GB -- and be offered in Wi-Fi only and Wi-Fi and cellular versions, just like the regular iPad.

If the base 16GB Wi-Fi iPad mini starts at $250 to $300, with the 32GB and 64GB models being $100 and $200 dearer. I expect the 16GB Wi-Fi + cellular iPad mini to be $380 to $430, and for the 32GB and 64GB models to increase in price by $100 increments.

How do these prices feel to you?