Capsim Midterm
pricing plays a role
in the rough cut stage of the purchase decision, in the fine cut stage of the purchase decision
within the process management initiatives, channel support systems
increase the effectiveness of the sales budget and therefore demand
dividends are paid to the stockholders in the
quarterly installments at a rate per share that you establish at the beginning of the year
within the process management initiatives, concurrent engineering
reduces R&B cycle time, the time needed to move products on the perceptual map and change the MTBF specifications
in the simulation, what are the components of a products material cost?
reliability component cost and positioning component
in the simulation what are the components of a product's material cost
reliability component cost and positioning component cost
inside each fine cut circle
segments have an ideal spot where demand is at its highest
what section of the perceptual map is considered ideal for the low end segment
upper left
If a line has a capacity of 100,000 units, the cost of changing the automation level 1 unit either up or down is
$400,000
if a product's price was $20, its material $8, and its labor $7, the margin per unit would be
$5
adding one additional unit of capacity costs
$6 + ($4xautomation level)
how much does it cost for MTBF per 1000 of reliability
.30
how much do segment prices gall each year
.50
what percentage of additional awareness does the second $1,000,000 increase in promotion budget buy?
20%
what percentage of additional awareness does the first 1000000 increase in promotion budget buy
26%
what percentage of the entire market segment does low end make up for
31
what perentage of the entire market segment does low end make up for
31%
traditional segment makes up for what percentage of sales
32%
products must plot within _____ units from the center of the circle on the perceptual map to survive the rough cut
4
products must plot within how many units from the center of the curcle on the perceptual map to survive the rough cut
4
what size of plant at the start of simulation
5 assembly lines with space to add 3 more
you are charged a _____brokerage fee to issue bonds and _____ brokerage fee if you retire bonds prior to their maturation date
5%, 1.5%
what is the starting awareness perentage of a new product
50 percent
how much awareness is created by the $250,000 promotion fee when a new product is invented?
50%
wha is the starting awareness percentage of a new product
50%
the average company should double in size every
6 years
assuming no additional production promotion, what percent of customers, reached through last year's marketing campaign will carry over into the current year
67%
emergency loans are made at what rate over the normal current debt interest rate
7.5%
teams can products up to how many products
8
the economic environment for the simulation game will include
a favorable environment featuring modest growth, high inflation, and reasonable interest rates
once you upload our offical decisions during a round, how many times can you change them before the end of the round
as many times as you want
which of the following is true about th accounts receivable lag and its implications on demand
at 60 days, demand is 98.5%
what is not considered in the fine cut
automation
the promotion budget affects
awareness
Stock price is a function of
book value, earnings per share and dividend
which customer group or market segment seeks cutting edge technology in both size and performance
high end customers
increasing a products reliability will result in which of the following changes to production costs
higher material cost
when an R&D effort started in 2001 complete on sept 15, 2002, the product revision kicks in
immediately upon completion
where is proximity to the ideal spot particularly important
in high technology segments
when purchasing increased capacity and automation the new capacity becomes available
in one year
when a product is moved to a new location on the perceptual map, the perceived age is
divided in half
EPSl earnings per share is calculated by
dividing net profit by the number of outstanding shares
over time, the segments will drift in which direction on the perceptual map
down right
ideal spot
drifts at same pace as the segment
at which point does the perceived ago of a traditional product peak
2
what is the minimum amount of time it takes to create a new product
1 year
which automation rating requires the longest time to re-position the product
10
which automation rating requires the longest time to reposition a product
10
what is your bond rate? the prime rate is 10%, your current bond rating slipped one category to AA
11.9%
inventory carrying cost is how many percent of the average cost of production
12
if you increase automation from 2 to 5 the cost is
12 per unit of capacity
if your short term interest rate is 12.1 the bond rate is
13.5
if you want to add 500,000 units of capacity to an assembly line with an automation rating of 5, how much will is cost? (6 for floor space and 4 times automation level)
13000000
what effects do process management initiatices have
Administrative savings Higher production efficiency Increase in demand Reduction of R&D times
what are four process management initiatives available to your company
Continuous Process Improvement Just-in-Time Channel Support System Concurrent Engineering
what are drivers of material costs
Higher performance Smaller size Higher Mean Time Between Failure (MTBF)
if the previous year you reached 100% customer awareness in your company, this year what will you need to do to maintain this level
I would only need to create 33% new awareness to maintain 100% this year
What is the most important criteria to a "traditional segment" consumer
MTBF
MTBF in the segments should be
MTBF(performance>MTBF(high end) MTB(low end)<MTBF(size)
Customers go through a two-stage buying process: The Rough Cut and the Fine Cut. In the Rough Cut, buyers focus on four product characteristics. Which one of the following is NOT one of these four product characteristics?
Quality size
when a segments product demand outstrips supply a products MTBF
a product with an MTBF can go 4900 hours below the range without affecting sales at 5000 below the range, products will lose all appeal
if your company has a sales budget of 3 million and drops it to 0
accessibility drops to 0% in three years
how is the strength of the sales channel measured
accessibility on a sale of 0 to 100 percent
your finance department is primarily concerned with
acquiring the capital needed for company activities. establishing a dividend policy that maximizes the return to shareholders. setting credit policies for customers and suppliers. profits.
how can assembly lines double their output
add a second shift
benchmarking reduces
administrative cost
what is the most important criteria to a traditional segment consumer?
age
how can research and development be reduced
budgeting money to quality initiatives
fast moving high tech segments tend to favor `
capacity over increased automation
finance department can use which of the following methods to acquire capital for company activities
current debt, stock issues, bond issues and profits
in capstone, pricing standards are set by
customers (market segments)
simulation pricing standards are set by
customers (martket segments)
budgeting money to quality initiative will lead to these outcomes
decrease R&B time increase demand increase efficiency produce administrative savings
what are three effects to increasing automation
decrease in labor hours longer repositioning period in R&D Higher efficiency
the relative cost of a product's material increases as: size is ____; performance is _______; and MTBF is ____.
decreased, increased and raised
an increase in promotional budgest have a
decreasing returns over time
capacity is sold by
entering a negative number in the buy/sell row on the production spreadsheet
Changing MTBF will
have no impact on perceived age
in order to achieve 100% accessibility, a team must
have two products in the same segment
False statement
high end and performance emphasize positioning
increasing performance and shrinking size does what to the material cost
increases
if you purchase production capacity and automation
it is available the next year
what happens to a products perceived age when it is re-positioned in R&D
it is reduced by 50%
what happens to a product priced at !1 above or below the segment guideline when a segments product supply outstrips demand
it loses 20% of its appeal
what happens to a company when its debt to assets ratio increases
its short term interest rates increase, its bond rating is reduced
when tracking market segments on the performance and size perceptual map, which segment moves or drifts the slowest?
low
rapid movement of an existing product on the perceptual map requires
low automation levels
which customer group or market segment seeks proven products, are indifferent to technological sophistication and are price motivated?
low end customers
which customer group or market segments seeks proven products are indifferent to technological sophistication and are price motivated
low end customers
the perceptual map is
marketing tool used to compare products against customer perceptions
a change in MTBF affects
material cost
the traditional ideal spot is
neat the center of its circle
R&D completion time depends on
number of projects in R&D, automation rating, similarity to existing products
if your team decides to introduce a new product, when should capacity and automation be purchased
one round prior to product release
which market segment places the most importance on reliability
performance
Customers go through a two-stage buying process: The Rough Cut and the Fine Cut. In the Rough Cut, buyers focus on four product characteristics. Name four product characteristics?
performance size reliability price
which market segment is less sensitive to price, but more to design
performance high end size
which customer group or market segment seeks high reliability, advance technology products that emphasize high performance?
performance customers
which customers seek high reliability, advanced technology products that emphasize high performance
performance customers
which market segment is less sensitive to price but more to design
performance, high end, size
what is the most important criteria to a high end segment customer
positioning
if you are marketing to the high end customers, which criteria is the most important to them in order of importance
positioning, age, MTBF, price
what two factors are considered in both the rough cut and fine cut of the customer buying process
price and reliability
marketing is concerned with 4 things
price place promotion product
when a segment product demans outstrips supply
product sales can be priced up to 4.90 above the price ranging without losing sales, products lose all appeal at 5 above the price range
when a segments product demand outstrips supply
products lose 20% for each dollar above or below the segment guideline
R&D projects can drive a projects
size age reliability performance
two characteristics on the perceptual map evaluates are
size and performance
two questions that dominate customers' thinking are
size and performance
if a products automation rating is substantially increase it will
take longer to move the product across the perceptual map
if product automation rating is substantially increased, it will
take longer to move the product across the perceptual map
re-positioning moves a product on the perceptual map from its old location to a new one. when does the new location become active?
the day the R&D projects completes
the higher the company's automation level
the lower the company's labor costs
what is one draw back of increasing automation
the product requires increased time/expense for subsequent short move repositioning
which customer group or market segment seeks proven products using current technology
traditional customers
what does traditional and low end segment emphasize
traditional segment emphasize the age criteria, low end segment emphasizes the price criteria
what three factors drive labor costs
wage and benefit rates, automation levels, second shift/overtime costs