BAE Exam #1
Law of Diminishing Returns
A law of economics stating that, as the number of new employees increases, the marginal product of an additional employee will at some point be less than the marginal product of the previous employee.
When the practice rounds are over, the stimulation will e reset and competition rounds will begin among the teams. Each management team will run a company with the following characteristics:
A $40 million dollar company with only 1 product
What is a market segment in the Foundation Business Stimulation?
A group of customers with similar buying criteria
In order to achieve 100% accessibility, a company must:
Have two products in the same market segments
At the beginning of stimulation, how many assembly lines exist within each industry?
One line per company (6 total)
If you or your team decides to introduce a new sensor product, when should capacity and automation be purchase?
One round prior to product release
What is the minimum amount of time that it takes to invent a new sensor?
One year
Which of the following attributes do not impact the location of the Ideal Spot in the Fine Cut circle?
Price
Marketing
Prices and promotes products. Interacts with customers via sales force and distribution system. Responsible of sales forecasts.
When a market segment's product supply exceeds demand, how much customer appeal will be lost for each $1 increase above or below the customer buying criteria price range set for that market segment?
10%
How can assembly lines double their capacity?
Add a second shift
After price, the Low tech Segment's next most important buying criteria is:
Age
The Low Tech segment's Ideal Spot is located:
At the center of the fine cut circle
The promotion budget affects:
Awareness
The Finance Department can use which of the following methods to acquire capital for company activities?
Current debt, stock issues, bond issues and profits
Inside the fine cut circle for both segments:
Demand is highest at the Ideal Spot
Production
Determines how many units will be manufactured. Buying and selling ____________ lines.
An increase in the promotional budget has:
Diminishing returns after a certain point investment
Assuming no additional expenditure for promotion next year, your customer awareness will decrease by 50%
False
T/F- If you purchase production capacity and automation they are available immediately
False
T/F- Market segment prices, as defined by customer buying criteria, fall during each year of the stimulation as a result of intense company competition
False
The Production Department sets the performance characteristics for any new product developed by the company
False
What, in order of priority, are the buying criteria for High Tech customers?
Ideal Position, Age, Price and Reliability
Which financial expenditure is best satisfied through the issue of bonds?
Investments in increasing production capacity
The relationship between promotion and sales budgets and sensor sales generally:
Is direct
In the Foundation simulation, there are two market segments:
Low and High Tec
Finance
Makes sure the company has the financial resources it needs to run through the year. The department can raise money via one-year bank notes, 10-year bonds or stock issues. Issues stock dividends, buy back stock or retire bonds before their due dates.
Last year, Andrews built 1,500,000 units of product Able and sold 1,400,000. After 14 months in R&D, a revision to product Able is released to the market on January 15th. Which of the following is correct regarding the 100,000 units not sold in the previous year?
They will be reworked to match the new specs for Able and sold at the new price.
T/F- There is only one product being produced at the beginning of the Foundation Business Stimulation
True
If you sell all of the capacity on a production line, inventory for that line is sold at...
Half the average cost of production
A change in MTFB affects:
Material Cost
What is the measure for product reliability?
Mean Time Before Failure (MTBF)
Which one of the following in NOT a product characteristics that R&D can set?
Quality
The Customer Buying Criteria remain constant from year to year for age, price and:
Reliability