The small group gathered in a conference room at a Red Roof Inn near Pittsburgh had a common bond and an unusual goal. They all worked for restaurants in the Red Lobster chain. Now they had to figure out whether a Red Lobster waitress had been unjustly fired. The panel included a general manager, an assistant manager, a server, a hostess and a bartender, all of whom had volunteered to review circumstances of the firing and had been told simply to do what they felt was fair.

The waitress, Ruth Hatton, was fired in 1996 for stealing a guest-comment card from the Pleasant Hills, Pa., Red Lobster where she worked. Ms. Hatton was then a 19-year Red Lobster veteran; when she was fired, she says, "it felt like a knife going through me." –– ADVERTISEMENT –– But Red Lobster allows employees who have been fired or disciplined to appeal to panels of co- workers, who hear testimony and can overturn management decisions and award damages. Thus, instead of suing, Ms. Hatton called for peer review, which took place three weeks after the firing. Across the country, a growing number of companies, including TRW Inc., Rockwell International Corp. and Marriott International Inc., are adopting similar ways of limiting worker lawsuits and easing workplace tensions. The most popular method is peer review, which lawyers say is particularly effective because it channels the pain and fury employees feel after being fired.

Darden Restaurants Inc., the Orlando, Fla., company that owns the Red Lobster and Olive Garden chains and has 110,000 workers, adopted peer review four years ago. The program has been "tremendously successful" in keeping valuable employees from unfair dismissal and cutting $1 million from annual legal expenses for employee disputes, which now total $3.5 million, says general counsel Clifford Whitehill. Until recent changes, about 100 disputes end up in peer review yearly, with only 10 resulting in lawsuits. Red Lobster managers and many employees also credit peer review with reducing racial tensions. They say peer review has, in some cases, reversed decisions by managers who overreacted to complaints from minority customers and employees.

Ms. Hatton's case, like at least half of the dozen or so disputes to go through peer review in the company's Pittsburgh region had a racial component. Ms. Hatton, who is white, was fired for pocketing a black couple's comment card complaining their prime rib was "rare" and their waitress "uncooperative." Ms. Hatton says she intended to show the card to her boss, not to steal it. Ms. Hatton chose peer review over going to court because it was "a lot cheaper," she says, adding: "I also liked the idea of being judged by people who know how things work in a little restaurant." Diane K. Canant, the Pleasant Hills restaurant's general manager, testified first. Ms. Canant, who supervised about 100 employees, said she fired Ms. Hatton after the irate customer complained to her and her supervisor. Through circumstances that remain unclear, the customer learned that Ms. Hatton had removed her comment card from the box.

"The customer felt violated because her card was taken from the box, and she felt that her complaint about the food had been ignored," Ms. Canant recalls telling the peer-review panel. Brandishing a company rule book, the manager said Ms. Hatton had violated a policy forbidding the removal of company property. Ms. Hatton, who says she received dozens of calls of support, testified next. The waitress, 53 years old at the time, explained that the woman had requested a well-done piece of prime rib and complained that the meat was fatty and undercooked. Ms. Hatton said she politely suggested that "prime rib always has fat on it," and the woman scowled. Ms. Hatton didn't explain her comment to the panel. She says now that she thought that, based on her experience with black customers in the working-class area, the customer might have confused prime rib and spare rib. Ms. Hatton then had the meat cooked some more. When the customer remained displeased, Ms. Hatton offered a free dessert. Apparently still unhappy, the woman doused the meat with steak sauce and then shoved away her plate. She or her companion then filled out a comment card, paid the bill and left, Ms. Hatton said. Consumed by curiosity, Ms. Hatton asked the hostess for the key to the comment box. She said she read the card, then pocketed it, intending to show it to Ms. Canant, who had fretted earlier that the prime rib was overcooked, not undercooked. Because of a problem that day heating the prime rib to the proper temperature, Ms. Hatton said, the restaurant was serving meat that had been cooked the previous day and then reheated. Ms. Hatton said further that she forgot about the card and inadvertently threw it out. (Red Lobster says it's against company policy to serve reheated meat. The chain no longer serves prime rib.) Third and last to testify was the hostess, Dawn Brown, then a 17-year-old student employed at the Pleasant Hills Red Lobster for the summer. "I didn't think it was a big deal to give her the key," she recalls telling the panel. "A lot of people would come up to me to get it."

In deliberations, panelists balanced the facts that a customer's feelings had been hurt and that an unofficial policy forbidding employees from going into the comment box had been violated against their belief that Ms. Hatton hadn't intended to steal company property. "We basically believed her. Ruth may not have really wanted Diane to see the comment card, but she really didn't think she had done anything wrong," says panelist Larry Simpson, the general manager of the Greensburg, Pa., Red Lobster and a friend of Ms. Canant's. All of the panelists had peer-review training and were being paid regular wages and travel expenses. Several panelists criticized Ms. Canant for not putting a rebuke in Ms. Hatton's personnel file and leaving it at that. Others suggested that her hands might have been tied by corporate headquarters. "Red Lobster is sensitive to race on a corporate level, and Florida could have said, 'Whack her. You have someone who [upset] a guest,' " Mr. Simpson says. "I think the whole thing snowballed." The panelists' views initially split by rank, with the hourly workers supporting Ms. Hatton. "By the end we were all going in the same direction," Mr. Simpson says. After an hour and a half, they unanimously restored Ms. Hatton's job. The unofficial policy against reading the contents of a comment box, they reasoned, hadn't been enforced at the restaurant. Still, because policy had been violated, the panel didn't grant the waitress the three weeks of lost wages she sought. Mr. Whitehill, Darden's general counsel, says the panel "reached the right result." Given Ms. Hatton's years of experience, he says, "she's somebody we want to keep." Ms. Canant says it "didn't bother me a bit that she got her job back." When she returned to work, Ms. Hatton says Ms. Canant treated her professionally and even cut her some slack when she had a bad back. When the manager transferred to Texas last summer, Ms. Hatton contributed to a going-away gift. "The process worked," the waitress says. "The panel took my claim seriously."

part 1) According to the article, peer review panels... (Please select all that apply)

a.		have decreased the legal costs of firms that attempted to use them
b.		are valued by Red Lobster management
c.		have increased the legal costs of firms that attempted to use them
d.		have been successful in preventing loss of valuable employees caused by poor termination decisions by managers
		e. are valued by Red Lobster employees part 2 Which of the following can we conclude from the article? Ms. Hatton was lying when she claimed that she pocketed the comment intending to show it to her boss but forgot about the card and inadvertently threw it out Ms. Hatton was telling the truth when she claimed that she pocketed the comment intending to show it to her boss but forgot about the card and inadvertently threw it out On the day that she took the comment, Ms. Hatton was the only employee who violated Red Lobster policy It was unusual for employees at the Pleasant Hills, PA Red Lobster restaurant to go into the comment box All of the above None of the above part3) Which of the following are true according to the article? Please select all that apply. The peer review panel included hourly workers The peer review panel included salaried workers Members of the peer review panel all received peer-review training Red Lobster provided detailed guidelines to the peer review panelists on how to decide the case The peer review panel included members who did not work for Red Lobster The peer review panel included junior employees The peer review panel included senior managers part4) Which of the following are true according to the article? Please select all that apply. The manager who fired Ms. Hatton was dissatisfied with the decision of the peer review panel Members of the peer review panel initially agreed with each other The panel supported the decision of the manager who fired Ms. Hatton Members of the peer review panel eventually agreed with each other

Oxygenated hemoglobin absorbs weakly in the red (hence its red color) and strongly in the near infrared, whereas deoxygenated hemoglobin has the opposite absorption. This fact is used in a "pulse oximeter" to measure oxygen saturation in arterial blood. The device clips onto the end of a person's finger and has two light-emitting diodes—a red (632 nm) and an infrared (930 nm)—and a photocell that detects the amount of light transmitted through the finger at each wavelength.

(a) Determine the frequency of each of these light sources.

red Hz

infrared Hz

(b) If 66% of the energy of the red source is absorbed in the blood, by what factor does the amplitude of the electromagnetic wave change? Hint: The intensity of the wave is equal to the average power per unit area as given by I = Emax2 2μ0c = c 2μ0 Bmax2.

Consider a point charge +q. A) Sketch the electric field lines and equipotetial lines near the charge. B) Explain how to interpret these equipotential lines. In other words, what does electric potential mean in terms of work? C) Indicate the direction of increasing potential in your sketch. D) Consider one potential line in your sketch. How much work is required to move a charge anywhere along that line.

General speaking, department located near entrances, on major aisles, and on the main level of multilevel stores have the best profit-generating potential. What additional factors
help to determine the location of department? Give examples of each factor. Consider a situation in which you received poor customer service in a retail store or from a customer service provider. Did you make the store's management aware of your experience? Have you returned to this retailer? For each of these questions, explain why you did what you did.

Near the end of 2017, the management of Babalu Musical Instrument Co., a new merchandising company, prepared the following estimated balance sheet for December 31, 2017.

BABALU MUSICAL INSTRUMENT COMPANY Estimated Balance Sheet December 31, 2017
Assets			Liabilities and Equity
Cash		$36,000	Accounts payable	$365,000
Accounts receivable		520,000	Bank loan payable	15,000
Inventory		165,000	Taxes payable (due   3/15/2018)	91,000
Total current assets		721,000	Total liabilities		$471,000
Equipment	$538,000		Common stock	474,500
Less accumulated   depreciation	67,250	470,750	Retained earnings	246,250
			Total stockholders' equity		720,750
Total assets		$1,191,750	Total liabilities and equity		$1,191,750

To prepare a master budget for January, February, and March of 2018, management gathers the following information.

a.	Babalu Musical’s single product is purchased for $30 per unit and resold for $55 per unit. The expected inventory level of 5,500 units on December 31, 2017, is more than management’s desired level for 2018, which is 20% of the next month’s expected sales (in units). Expected sales are: January, 7,250 units; February, 8,750 units; March, 11,500 units; and April, 10,000 units.
b.	Cash sales and credit sales represent 25% and 75%, respectively, of total sales. Of the credit sales, 70% is collected in the first month after the month of sale and 30% in the second month after the month of sale. For the December 31, 2017, accounts receivable balance, $125,000 is collected in January and the remaining $395,000 is collected in February.
c.	Merchandise purchases are paid for as follows: 20% in the first month after the month of purchase and 80% in the second month after the month of purchase. For the December 31, 2017, accounts payable balance, $85,000 is paid in January and the remaining $280,000 is paid in February.
d.	Sales commissions equal to 20% of sales are paid each month. Sales salaries (excluding commissions) are $60,000 per year.
e.	General and administrative salaries are $144,000 per year. Maintenance expense equals $2,200 per month and is paid in cash.
f.	Equipment reported in the December 31, 2017, balance sheet was purchased in January 2017. It is being depreciated over eight years under the straight-line method with no salvage value. The following amounts for new equipment purchases are planned in the coming quarter: January, $34,000; February, $98,000; and March, $29,500. This equipment will be depreciated under the straight-line method over eight years with no salvage value. A full month’s depreciation is taken for the month in which equipment is purchased.
g.	The company plans to acquire land at the end of March at a cost of $145,000, which will be paid with cash on the last day of the month.
h.	Babalu Musical has a working arrangement with its bank to obtain additional loans as needed. The interest rate is 12% per year, and interest is paid at each month-end based on the beginning balance. Partial or full payments on these loans can be made on the last day of the month. The company has agreed to maintain a minimum ending cash balance of $27,588 in each month.
i.	The income tax rate for the company is 30%. Income taxes on the first quarter’s income will not be paid until April 15.

Requirements:

Prepare a master budget for each of the first three months of 2018; include the following component budgets (show supporting calculations as needed directly behind that budget, and round amounts to the nearest dollar):

1.) Monthly sales budgets (showing both budgeted unit sales and dollar sales).

2.) Monthly merchandise purchases budgets.

3.) Monthly selling expense budgets.

4.) Monthly general and administrative expense budgets.

5.) Monthly capital expenditures budgets.

6.) Monthly cash budgets.

7.) Budgeted income statement for the entire first quarter (not for each month).

8.) Budgeted balance sheet as of March 31, 2018

Near the end of 2017, the management of Babalu Musical Instrument Co., a new merchandising company, prepared the following estimated balance sheet for December 31, 2017.

BABALU MUSICAL INSTRUMENT COMPANY Estimated Balance Sheet December 31, 2017
Assets			Liabilities and Equity
Cash		$36,000	Accounts payable	$365,000
Accounts receivable		520,000	Bank loan payable	15,000
Inventory		165,000	Taxes payable (due   3/15/2018)	91,000
Total current assets		721,000	Total liabilities		$471,000
Equipment	$538,000		Common stock	474,500
Less accumulated   depreciation	67,250	470,750	Retained earnings	246,250
			Total stockholders' equity		720,750
Total assets		$1,191,750	Total liabilities and equity		$1,191,750

To prepare a master budget for January, February, and March of 2018, management gathers the following information.

a.	Babalu Musical’s single product is purchased for $30 per unit and resold for $55 per unit. The expected inventory level of 5,500 units on December 31, 2017, is more than management’s desired level for 2018, which is 20% of the next month’s expected sales (in units). Expected sales are: January, 7,250 units; February, 8,750 units; March, 11,500 units; and April, 10,000 units.
b.	Cash sales and credit sales represent 25% and 75%, respectively, of total sales. Of the credit sales, 70% is collected in the first month after the month of sale and 30% in the second month after the month of sale. For the December 31, 2017, accounts receivable balance, $125,000 is collected in January and the remaining $395,000 is collected in February.
c.	Merchandise purchases are paid for as follows: 20% in the first month after the month of purchase and 80% in the second month after the month of purchase. For the December 31, 2017, accounts payable balance, $85,000 is paid in January and the remaining $280,000 is paid in February.
d.	Sales commissions equal to 20% of sales are paid each month. Sales salaries (excluding commissions) are $60,000 per year.
e.	General and administrative salaries are $144,000 per year. Maintenance expense equals $2,200 per month and is paid in cash.
f.	Equipment reported in the December 31, 2017, balance sheet was purchased in January 2017. It is being depreciated over eight years under the straight-line method with no salvage value. The following amounts for new equipment purchases are planned in the coming quarter: January, $34,000; February, $98,000; and March, $29,500. This equipment will be depreciated under the straight-line method over eight years with no salvage value. A full month’s depreciation is taken for the month in which equipment is purchased.
g.	The company plans to acquire land at the end of March at a cost of $145,000, which will be paid with cash on the last day of the month.
h.	Babalu Musical has a working arrangement with its bank to obtain additional loans as needed. The interest rate is 12% per year, and interest is paid at each month-end based on the beginning balance. Partial or full payments on these loans can be made on the last day of the month. The company has agreed to maintain a minimum ending cash balance of $27,588 in each month.
i.	The income tax rate for the company is 30%. Income taxes on the first quarter’s income will not be paid until April 15.

Requirements:

Prepare a master budget for each of the first three months of 2018; include the following component budgets (show supporting calculations as needed directly behind that budget, and round amounts to the nearest dollar):

PLEASE EXPLAIN ALL CALCULATIONS

1.) Monthly cash budgets.

2.) Budgeted income statement for the entire first quarter (not for each month).

3.) Budgeted balance sheet as of March 31, 2018

McHuffter Condominiums, Inc., of Pensacola, Florida, recently purchased land near the Gulf of Mexico and is attempting to determine the size of the condominium development it should build. Three sizes of develop-ment are being considered; Small, d1; Medium, d2; and large, d3. At the same time, an uncertain economy makes it difficult to ascertain the demand for the new condominiums. McHuffter's management realizes that a large development followed by a low demand could be very costly to the company. However, if McHuffter makes a conservative small-development decision and then finds a high demand, the firm's profits will be lower than they might have been. With the three levels of demand-low, medium and high. McHuffter's management has prepared the following profit ($000). (20 pts.) payoff table ------------------------------------------- Demand Decision ---------------------------- Alternatives Low Medium High ------------------------------------------- Small, d1 400 400 400 Medium, d2 100 600 600 Large, d3 -300 300 900 -------------------------------------------- a) If nothing is known about the demand probabilities, what are the recommended decision using the Maximax(optimistic), Maximin (pessi- mistic), and Minimax regret approaches? b) If P(low) = 0.20, P(medium) = 0.35, and P(high) = 0.45, What is the recommended decision using the expected value approach? c) What is the expected value of perfect information (EVPI)? You have to use regret table to get EVPI. Suppose that before making a final decision, McHuffter is considering conducting a survey to help evaluate the demand for the new condominium development. The survey report is anticipated to indicate one of two levels of demand: weak(W) or strong(S). The relevant probabilities are as follows: (25 pts) P(W)= 0.3 P(low/W) = 0.50 P(low/S) = 0.10 P(S)= 0.7 P(medium/W)= 0.40 P(medium/S)= 0.25 P(high/W) = 0.10 P(high/S) = 0.65 BDSC 340.001-3 d) Construct a decision tree for this problem and analyze it. e) What is McHuffter’s optimal decision? f) What is the expected value of the survey(sample) information? McHuffter Condominiums, Inc., of Pensacola, Florida, recently purchased land near the Gulf of Mexico and is attempting to determine the size of the condominium development it should build. Three sizes of develop-ment are being considered; Small, d1; Medium, d2; and large, d3. At the same time, an uncertain economy makes it difficult to ascertain the demand for the new condominiums. McHuffter's management realizes that a large development followed by a low demand could be very costly to the company. However, if McHuffter makes a conservative small-development decision and then finds a high demand, the firm's profits will be lower than they might have been. With the three levels of demand-low, medium and high. McHuffter's management has prepared the following profit ($000). (20 pts.) payoff table ------------------------------------------- Demand Decision ---------------------------- Alternatives Low Medium High ------------------------------------------- Small, d1 400 400 400 Medium, d2 100 600 600 Large, d3 -300 300 900 -------------------------------------------- a) If nothing is known about the demand probabilities, what are the recommended decision using the Maximax(optimistic), Maximin (pessi- mistic), and Minimax regret approaches? b) If P(low) = 0.20, P(medium) = 0.35, and P(high) = 0.45, What is the recommended decision using the expected value approach? c) What is the expected value of perfect information (EVPI)? You have to use regret table to get EVPI. Suppose that before making a final decision, McHuffter is considering conducting a survey to help evaluate the demand for the new condominium development. The survey report is anticipated to indicate one of two levels of demand: weak(W) or strong(S). The relevant probabilities are as follows: (25 pts) P(W)= 0.3 P(low/W) = 0.50 P(low/S) = 0.10 P(S)= 0.7 P(medium/W)= 0.40 P(medium/S)= 0.25 P(high/W) = 0.10 P(high/S) = 0.65 BDSC 340.001-3 d) Construct a decision tree for this problem and analyze it. e) What is McHuffter’s optimal decision? f) What is the expected value of the survey(sample) information?

Groups of dolphins were observed off the coast of Iceland near Keflavik in 1998. The data in the file dolphin_dat on the course website give the time of the day and the main activity of the group, whether travelling quickly, feeding, or socializing. The dolphin groups varied in size. Usually feeding or socializing groups were larger than travelling groups.

Source of data: Marianne Rasmussen, Department of Biology, University of Southern Denmark, Odense, Denmark.

Activity        Period  Groups
Travel  Morning  6
Feed    Morning 28
Social  Morning 38
Travel  Noon     6
Feed    Noon     4
Social  Noon     5
Travel  Afternoon       14
Feed    Afternoon        0
Social  Afternoon        9
Travel  Evening 13
Feed    Evening 56
Social  Evening 10

A) Find a 90% confidence interval for the difference between morning and evening for the proportion of dolphins feeding assuming that the data is a result of two simple random samples and that the samples for both time periods are independent of each other.

B) Does there appear to be a significant difference in the proportion of dolphins engaged in feeding between morning and evening? Conduct the appropriate test of significance and discuss your results.

Consider a farmer and a rancher who operate near one another. The farmer grows crops and the
rancher’s herd wanders and tramples the farmer’s crops. If the herd tramples the crops, it causes
$400 per week worth of damage to the farmer. The rancher could put a fence around the herd to
prevent damage to the crops, but the cost for the rancher to build and maintain the fence is $500
per week. The farmer could protect his crops with a fence around the crops at a cost of $300 per
week. Assume no transaction costs.

a. Suppose the farmer has the property rights, meaning the farmer has a legal claim if his
crops are destroyed. What would the rancher do? Would he build a fence around his herd,
would he let his herd wander and trample the crops, or is there something else he could
do?

b. Suppose the rancher has the property rights, meaning the farmer has no legal claim if his
crops are destroyed. What would the farmer do?

Now, for parts c. and d. , imagine the damage from the trampling costs are $200.

c. Suppose the farmer has the property rights. What does the rancher do?
d. Suppose the rancher has the property rights. What does the farmer do?
e. Define the Coase Theorem, and explain how your answers fit the Coase Theorem’s
predictions.

1. A recent news story (not really!) highlighted the near-drowning of a Navy Seal recruit that deliberately hyperventilated before diving into the water. The recruit was practicing an exercise that required them to hold their breath underwater for an extended period of time. The recruit reasoned that hyperventilation prior to the exercise would alter their physiology in a way that would increase the length of time they could hold their breath. Explain the physiological basis of this belief (use the terms hypocapnia and hypercapnia in your answer)

2. The digestive system and respiratory system share some structures, yet others must be kept separate to prevent choking. Describe how substances that are intended to be swallowed may get “misdirected” and lead to choking. Be sure to include all structures involved.