The TMA Questions
PART A: FORTUNE MOTORS (TAIWAN): IMPLEMENTING STRATEGY CHANGE USING THE BALANCED SCORECARD

Jung Hua Li, chief executive officer (CEO) of Fortune Motors, the largest Mitsubishi dealership in Taiwan, sat in his office in eastern Taipei on a chilly day in January 2004, thinking carefully about his vision for the survival of his company. He knew that Fortune Motors’ sales in 2003 had fallen below 50,000 units for the first time in 10 years. Fortune Motors’ market share had in fact been falling for several years, which Li attributed in part to Toyota’s aggressive growth. With long experience of selling and financing new Mitsubishi cars and small commercial vehicles throughout Taiwan, Li had what he thought was a good plan to enter the business of financing used-car purchases. He thought the “Balanced Scorecard” would be a very useful tool to help implement this change. The first step would be to construct a corporate scorecard. But what should the corporate scorecard look like? What critical variables should he monitor carefully to give him a clear picture of how well his change plan was proceeding?

TAIWAN IN THE EARLY TWENTY-FIRST CENTURY
Taiwan, with a population of 22 million in 2000, was one of the so-called “Asian Tigers” that had experienced enormous economic growth since 1960. Per capita gross domestic product (GDP) had doubled approximately every five years until the mid-1990s, exceeding $1,000 for the first time in 1976. (This value was considered by some to indicate that a country was no longer “developing.”) Even the Asian financial crisis of 1997 had only put a small dent in that decade’s average annual growth rate of approximately 7 per cent: growth in 1998 had been 4.5 per cent, but had recovered to nearly 6 per cent the following year. Part of this increase had been attributed to the growth of the People’s Republic of China (mainland China). Taiwanese companies were active and enthusiastic investors in the mainland economy, despite political differences between their respective governments, which created difficulties for the Taiwanese. For example, except for holiday specials, no direct flights were available from Taiwan to the People’s Republic of China; travelers had to fly via Hong Kong. The new millennium had brought more difficulties. For the Taiwanese economy, 2001 had been an annus horribilis: GDP per capita had fallen 2.2 per cent, and by the end of 2003, had still not recovered to 2000 levels.

THE AUTOMOTIVE INDUSTRY IN TAIWAN

Several major automakers were represented in domestic auto manufacturing industry in Taiwan. Toyota, Nissan, Ford/Mazda, Mitsubishi, Suzuki and Honda all had local assembly plants, which primarily served the local market, though Ford exported approximately 4,500 units (7 per cent of output), and Mitsubishi exported approximately 1,500 units (1.5 per cent) of production in 2003. This domestic manufacturing industry operated under the protection of an import tariff, which had been 30 per cent during most of the 1990s, but in 2002, had been reduced by one percentage point per year.

The total market for new cars in Taiwan was approximately 400,000 vehicles per year. The market had been in steady decline during the late 1990s and had fallen drastically in 2001. Sales had recovered to some degree in the two following years, but 2003 sales had still not recovered to their 2000 level. Toyota was the most successful local manufacturer, with sales of about 100,000 units (28 per cent market share) in 2003. Mitsubishi’s share was nearly 24 per cent market share, or about 86,000 units. Various reasons for this decline had been suggested, including high oil prices and the fact that in recent years, many Taiwanese businesspeople had either temporarily or permanently immigrated to China. Exact numbers of immigrants were difficult to obtain, but some estimated the number at between two million and four million.

As in most countries, new cars in Taiwan were sold through dealerships appointed by the manufacturers and were usually exclusive to a single automaker. Financing for new car purchases was provided by both banks and the dealers (or by automakers through their dealers). Auto loans in Taiwan were a small part of most banks’ business, so they usually subcontracted the credit evaluation to outside companies, which relied on public credit data and were paid based on the number of applications processed, not on the accuracy of their risk assessment. As a result, banks’ bad auto loans were about 3 per cent per year, whereas Fortune Motors, for example, with a close relationship with its customers, enjoyed a bad loan rate of only 1.3 per cent on its new car loans. Consequently, new car financing was a profitable business for dealers.

The used-car market, however, operated differently in Taiwan. Because new car dealers were registered for tax purposes, when they sold cars, they were required to charge 5 per cent sales tax on both new and used cars. However, when private individuals sold their used cars, the transaction attracted no tax — the purchaser simply registered the new ownership. As a result of this 5 per cent price advantage, the market for used cars was served by approximately 3,000 unregulated small, often family-owned, used-car dealers who were not — and did not need to be — registered for sales tax purposes. Thus, when a new car customer wanted to trade in an old car, the new car dealer did not typically buy it. Instead, the salesperson would put the customer in touch with a reputable used-car trader to complete the transaction. If someone wished to buy a used car and needed financing, finding a source of finance was often difficult. Used-car buyers were perceived as high-credit risks by banks, and banks did not have the expertise to evaluate that risk. The only sources of used-car financing were family or the illegal underground financing market where interest rates could be up to 1 per cent per day. In contrast, a low-risk customer would pay about 20 per cent per year for a personal loan.

FORTUNE MOTORS LTD.

Fortune Motors was the larger of the two Mitsubishi retail dealers in Taiwan and was the exclusive supplier of Mitsubishi’s line of small commercial vehicles (less than 3.5 tons). The typical price of these vehicles was approximately NT$300,000. Fortune Motors was 40 per cent owned by China Motors Corporation, the Taiwanese manufacturer of Mitsubishi vehicles, and 60 per cent owned by three local families.

In 2004, Fortune Motor Company operated 89 sales centres throughout the country and dominated the market for small commercial vehicles, with 80 per cent market share. Within Mitsubishi vehicles (including passenger cars), Fortune held 60 per cent share (Shung Ye Group, which sold only the Mitsubishi car line, held the remaining share). In the previous two years, the market for new vehicles in Taiwan had rebounded, growing at about 9 per cent per year after several years of decline. Mitsubishi’s share had declined from 25.4 per cent in 2002 to 20.8 per cent in 2003, and within that, Fortune Motors’ share from 15.8 per cent to 12.1 per cent.

The company sold and financed new cars (about 40 per cent of Fortune’s new car sales were also financed by them) and provided service. Selling new cars was unprofitable, but the financing was profitable, so overall, Fortune Motors’ new car sales and financing activity broke even. Servicing was profitable and made about as much profit as financing new cars.

A critical part of financing was the accurate assessment of the credit risk of the customer. Historically, approximately 10 per cent of applications were not approved for credit risk reasons.

Li attributed the company’s success over its 30-year history to its strong core values, which centered on its careful attention to customer service and satisfaction. Fortune Motors’ service motto was “Get it right the first time — or it is free.”

THE BALANCED SCORECARD

The Balanced Scorecard was a tool first proposed by Professor Robert Kaplan and others, based on field research into best practice performance measurement. Each company’s scorecard was unique, reflecting the company’s corporate strategy, with a limited number of (typically four) measures on four interrelated dimensions or perspectives: Financial, Innovation, Customer and Internal Processes. Senior management would usually prepare each company’s corporate scorecard. Sub-units of the company would then build their own lower-level scorecard, informed by and linked to the corporate scorecard. Often, the process of identifying the key measures and their interrelationships was a valuable process in its own right, clarifying the role of sub-units in the corporate strategy. The ongoing annual review and fine-tuning of the scorecard was also a valuable strategy communication and implementation process.

THE NEW STRATEGY

Li’s vision was to build on the company’s expertise in financing new cars and on the powerful network of relationships between its 1,500 salespeople located in the 89 sales centres with the thousands of small and medium-sized used car sellers around the country. These two strengths would allow Fortune Motors to sell used-car financing profitably through the thousands of small and medium-sized used car dealers in Taiwan. The dealers that would offer Fortune’s financing would not merely be a more attractive source of financing than the illegal market or relatives but would need to meet strict requirements for cleanliness of their premises and for quality and safety standards.

Li envisioned a nationwide umbrella branding of used-car dealers that Fortune Motors would approve as vendors of its financing service. The name-mark he proposed for this venture was SUM, which stood for “Serve Your Motors.” SUM-appointed car dealers would be required to maintain high ethical and customer service standards, compatible with Fortune’s own values. Not all used car dealers would be able to become members of the SUM family. Li felt it important that the SUM dealers share his values of the importance of customer service. For this reason, Li believed that husband-and-wife owner-managed small dealerships were most suitable. (The very largest used-car dealers would typically be run by hired managers and were already too large to be able to easily change their existing values, so they would not be appointed. Very small dealers were excluded because they would probably not be economical, since signing up a dealer required considerable effort on the part of Fortune Motors). Li estimated that approximately 3,000 dealers would qualify. In effect, the SUM brand would become a quality and integrity certification of a used-car dealer. For warranty purposes, certified dealers would only be permitted to sell Taiwanese-made vehicles less than five years old. Li did not plan to charge a fee to the used-car dealers for the use of the SUM brand, unless their volume was very small.

Customers buying from a SUM dealer would know that they would be receiving a guaranteed high-quality used car, and if they were financing their purchase, a fair interest rate. In fact, customers would be able to buy an additional warranty if they wished. All this would make purchasing (and financing) a used car from a SUM-certified dealer far less stressful and risky than was the case at present.

IMPLEMENTING THE PLANNED BALANCED SCORECARD

Li was aware that he needed to first recruit used car dealers over the next several years and, through them, build up the used car loan business. At the same time, he was concerned about the downturn in the economy, the pressure from Toyota, and the risks of the new business. His management team fully supported the new strategy. He knew that as CEO, it was his responsibility to create the corporate scorecard. How could he best measure the effectiveness of his new strategy?

(Source: Ivey Publications, 2011)

Required:

Explain each of the following points or inquires separately:
1- Evaluate the strengths and weaknesses of the used-car financing business proposal. (190 words)

2- What must Jung Hua Li do well in order for the new business to succeed? (100 words)

3- Prepare a balanced scorecard for the implementation of this business and discuss the linkage between the measures. (200 words)

The TMA Questions

PART A: FORTUNE MOTORS (TAIWAN): IMPLEMENTING STRATEGY CHANGE USING THE BALANCED SCORECARD

Jung Hua Li, chief executive officer (CEO) of Fortune Motors, the largest Mitsubishi dealership in Taiwan, sat in his office in eastern Taipei on a chilly day in January 2004, thinking carefully about his vision for the survival of his company. He knew that Fortune Motors’ sales in 2003 had fallen below 50,000 units for the first time in 10 years. Fortune Motors’ market share had in fact been falling for several years, which Li attributed in part to Toyota’s aggressive growth. With long experience of selling and financing new Mitsubishi cars and small commercial vehicles throughout Taiwan, Li had what he thought was a good plan to enter the business of financing used-car purchases. He thought the “Balanced Scorecard” would be a very useful tool to help implement this change. The first step would be to construct a corporate scorecard. But what should the corporate scorecard look like? What critical variables should he monitor carefully to give him a clear picture of how well his change plan was proceeding?

TAIWAN IN THE EARLY TWENTY-FIRST CENTURY

Taiwan, with a population of 22 million in 2000, was one of the so-called “Asian Tigers” that had experienced enormous economic growth since 1960. Per capita gross domestic product (GDP) had doubled approximately every five years until the mid-1990s, exceeding $1,000 for the first time in 1976. (This value was considered by some to indicate that a country was no longer “developing.”) Even the Asian financial crisis of 1997 had only put a small dent in that decade’s average annual growth rate of approximately 7 per cent: growth in 1998 had been 4.5 per cent, but had recovered to nearly 6 per cent the following year. Part of this increase had been attributed to the growth of the People’s Republic of China (mainland China). Taiwanese companies were active and enthusiastic investors in the mainland economy, despite political differences between their respective governments, which created difficulties for the Taiwanese. For example, except for holiday specials, no direct flights were available from Taiwan to the People’s Republic of China; travelers had to fly via Hong Kong. The new millennium had brought more difficulties. For the Taiwanese economy, 2001 had been an annus horribilis: GDP per capita had fallen 2.2 per cent, and by the end of 2003, had still not recovered to 2000 levels.

THE AUTOMOTIVE INDUSTRY IN TAIWAN

Several major automakers were represented in domestic auto manufacturing industry in Taiwan. Toyota, Nissan, Ford/Mazda, Mitsubishi, Suzuki and Honda all had local assembly plants, which primarily served the local market, though Ford exported approximately 4,500 units (7 per cent of output), and Mitsubishi exported approximately 1,500 units (1.5 per cent) of production in 2003. This domestic manufacturing industry operated under the protection of an import tariff, which had been 30 per cent during most of the 1990s, but in 2002, had been reduced by one percentage point per year.

The total market for new cars in Taiwan was approximately 400,000 vehicles per year. The market had been in steady decline during the late 1990s and had fallen drastically in 2001. Sales had recovered to some degree in the two following years, but 2003 sales had still not recovered to their 2000 level. Toyota was the most successful local manufacturer, with sales of about 100,000 units (28 per cent market share) in 2003. Mitsubishi’s share was nearly 24 per cent market share, or about 86,000 units. Various reasons for this decline had been suggested, including high oil prices and the fact that in recent years, many Taiwanese businesspeople had either temporarily or permanently immigrated to China. Exact numbers of immigrants were difficult to obtain, but some estimated the number at between two million and four million.

As in most countries, new cars in Taiwan were sold through dealerships appointed by the manufacturers and were usually exclusive to a single automaker. Financing for new car purchases was provided by both banks and the dealers (or by automakers through their dealers). Auto loans in Taiwan were a small part of most banks’ business, so they usually subcontracted the credit evaluation to outside companies, which relied on public credit data and were paid based on the number of applications processed, not on the accuracy of their risk assessment. As a result, banks’ bad auto loans were about 3 per cent per year, whereas Fortune Motors, for example, with a close relationship with its customers, enjoyed a bad loan rate of only 1.3 per cent on its new car loans. Consequently, new car financing was a profitable business for dealers.

The used-car market, however, operated differently in Taiwan. Because new car dealers were registered for tax purposes, when they sold cars, they were required to charge 5 per cent sales tax on both new and used cars. However, when private individuals sold their used cars, the transaction attracted no tax — the purchaser simply registered the new ownership. As a result of this 5 per cent price advantage, the market for used cars was served by approximately 3,000 unregulated small, often family-owned, used-car dealers who were not — and did not need to be — registered for sales tax purposes. Thus, when a new car customer wanted to trade in an old car, the new car dealer did not typically buy it. Instead, the salesperson would put the customer in touch with a reputable used-car trader to complete the transaction. If someone wished to buy a used car and needed financing, finding a source of finance was often difficult. Used-car buyers were perceived as high-credit risks by banks, and banks did not have the expertise to evaluate that risk. The only sources of used-car financing were family or the illegal underground financing market where interest rates could be up to 1 per cent per day. In contrast, a low-risk customer would pay about 20 per cent per year for a personal loan.

FORTUNE MOTORS LTD.

Fortune Motors was the larger of the two Mitsubishi retail dealers in Taiwan and was the exclusive supplier of Mitsubishi’s line of small commercial vehicles (less than 3.5 tons). The typical price of these vehicles was approximately NT$300,000. Fortune Motors was 40 per cent owned by China Motors Corporation, the Taiwanese manufacturer of Mitsubishi vehicles, and 60 per cent owned by three local families.

In 2004, Fortune Motor Company operated 89 sales centres throughout the country and dominated the market for small commercial vehicles, with 80 per cent market share. Within Mitsubishi vehicles (including passenger cars), Fortune held 60 per cent share (Shung Ye Group, which sold only the Mitsubishi car line, held the remaining share). In the previous two years, the market for new vehicles in Taiwan had rebounded, growing at about 9 per cent per year after several years of decline. Mitsubishi’s share had declined from 25.4 per cent in 2002 to 20.8 per cent in 2003, and within that, Fortune Motors’ share from 15.8 per cent to 12.1 per cent.

The company sold and financed new cars (about 40 per cent of Fortune’s new car sales were also financed by them) and provided service. Selling new cars was unprofitable, but the financing was profitable, so overall, Fortune Motors’ new car sales and financing activity broke even. Servicing was profitable and made about as much profit as financing new cars.

A critical part of financing was the accurate assessment of the credit risk of the customer. Historically, approximately 10 per cent of applications were not approved for credit risk reasons.

Li attributed the company’s success over its 30-year history to its strong core values, which centered on its careful attention to customer service and satisfaction. Fortune Motors’ service motto was “Get it right the first time — or it is free.”

THE BALANCED SCORECARD

The Balanced Scorecard was a tool first proposed by Professor Robert Kaplan and others, based on field research into best practice performance measurement. Each company’s scorecard was unique, reflecting the company’s corporate strategy, with a limited number of (typically four) measures on four interrelated dimensions or perspectives: Financial, Innovation, Customer and Internal Processes. Senior management would usually prepare each company’s corporate scorecard. Sub-units of the company would then build their own lower-level scorecard, informed by and linked to the corporate scorecard. Often, the process of identifying the key measures and their interrelationships was a valuable process in its own right, clarifying the role of sub-units in the corporate strategy. The ongoing annual review and fine-tuning of the scorecard was also a valuable strategy communication and implementation process.

THE NEW STRATEGY

Li’s vision was to build on the company’s expertise in financing new cars and on the powerful network of relationships between its 1,500 salespeople located in the 89 sales centres with the thousands of small and medium-sized used car sellers around the country. These two strengths would allow Fortune Motors to sell used-car financing profitably through the thousands of small and medium-sized used car dealers in Taiwan. The dealers that would offer Fortune’s financing would not merely be a more attractive source of financing than the illegal market or relatives but would need to meet strict requirements for cleanliness of their premises and for quality and safety standards.

Li envisioned a nationwide umbrella branding of used-car dealers that Fortune Motors would approve as vendors of its financing service. The name-mark he proposed for this venture was SUM, which stood for “Serve Your Motors.” SUM-appointed car dealers would be required to maintain high ethical and customer service standards, compatible with Fortune’s own values. Not all used car dealers would be able to become members of the SUM family. Li felt it important that the SUM dealers share his values of the importance of customer service. For this reason, Li believed that husband-and-wife owner-managed small dealerships were most suitable. (The very largest used-car dealers would typically be run by hired managers and were already too large to be able to easily change their existing values, so they would not be appointed. Very small dealers were excluded because they would probably not be economical, since signing up a dealer required considerable effort on the part of Fortune Motors). Li estimated that approximately 3,000 dealers would qualify. In effect, the SUM brand would become a quality and integrity certification of a used-car dealer. For warranty purposes, certified dealers would only be permitted to sell Taiwanese-made vehicles less than five years old. Li did not plan to charge a fee to the used-car dealers for the use of the SUM brand, unless their volume was very small.

Customers buying from a SUM dealer would know that they would be receiving a guaranteed high-quality used car, and if they were financing their purchase, a fair interest rate. In fact, customers would be able to buy an additional warranty if they wished. All this would make purchasing (and financing) a used car from a SUM-certified dealer far less stressful and risky than was the case at present.

IMPLEMENTING THE PLANNED BALANCED SCORECARD

Li was aware that he needed to first recruit used car dealers over the next several years and, through them, build up the used car loan business. At the same time, he was concerned about the downturn in the economy, the pressure from Toyota, and the risks of the new business. His management team fully supported the new strategy. He knew that as CEO, it was his responsibility to create the corporate scorecard. How could he best measure the effectiveness of his new strategy?

(Source: Ivey Publications, 2011)

Required:

Explain each of the following points or inquires separately:

1. Evaluate the strengths and weaknesses of the used-car financing business proposal. (190 words)
2. What must Jung Hua Li do well in order for the new business to succeed? (100 words)
3. Prepare a balanced scorecard for the implementation of this business and discuss the linkage between the measures. (200 words)

            [Marks: (20+10+30) = 60]

PART B: THE SUPPLY CHAIN

Several studies of inter-firm accounting have shown how accounting and controls are
implicated in the management of supply chains. Supply Chain Management (SCM) is an essential element to operational efficiency.

Required:

1. Briefly explain the supply chain management. (70 words)
2. Discuss, using examples, four five of the risks encountered in strategic alliances. (150 words)
3. Discuss the link between the management accounting and the supply chain. (100 words)
4. Elaborate on how a good management of the supply chain, using accounting systems, improves the customer’s satisfaction. (140 words)

1. Consider a wholesaler and a retailer selling designer handbags. Each has market power. The wholesaler sells designer hadbags to the retailer, which then sells the handbags to consumers. The demand for handbags is captured by P = 24-Q. Assume that the marginal cost of producing a handbag is constant (MC=$8). Consider the following scenarios:

a) Suppose that the retailer is the only firm and that it can produce the handbags it sells (there is no wholesaler here). How many handbags will be produced and what price will be charged? Draw a graph and show these points on the diagram.

b) Now suppose that the retailer cannot produce handbags and must instead buy them from the wholesaler. The wholesaler charges the downstream firm $16 per handbag. How many handbags will the retailer purchase and sell, and what price will the retailer charge?

2. If the wholesaler and retailer in problem 1 merged, what would be the effect on overall social surplus?

3. Discuss the problem of double marginalization. What is it? What causes it? How is it mitigated by a vertical merger?

4. Define first degree price discrimination, second degree price discrimination, and third degree price discrimination. Provide an example of each.

5. We have seen how monopolistic industries can result in a deadweight loss relevant to the competitive outcome. Consider the case of a monopolist engaging in first degree (perfect) price discrimination. How do you think the profits of the monopolist and overall social welfare are affected compared to the case where the monopolist sets a single monopoly price? (Hint: try drawing a simple diagram in both cases).

Caffeine is often added to headache medications because it affects the flow of blood in vessels and may enhance the pain relieving qualities of the medication. You have been tasked with evaluating one process that extracts caffeine from a coffee slurry, and you decide to study a small scale version of the process. A coffee slurry containing a mass fraction of 0.01 g caffeine/g, 0.08 g other solids/g, and 0.91 g water/g is fed to a mixer at a rate of 710.0 g/min. Na2CO3 is added to the mixer such that the mass ratio of Na2CO3 to coffee slurry is 0.0300. This aqueous solution proceeds to an extractor where CH2Cl2 is added such that the mass ratio of CH2Cl2 to coffee slurry entering the extractor is 0.440. Two streams leave the extractor. The first is a mostly aqueous stream that leaves the process containing some caffeine, all of the other solids in the original slurry, all of the Na2CO3, all of the water and 2% of the mass of CH2Cl2 entering the extractor. The second stream contains the remaining caffeine and CH2Cl2, and enters an evaporator that completely vaporizes the CH2Cl2. The vaporized CH2Cl2 is condensed and is merged with the fresh CH2Cl2 on the way to the extractor. The dried caffeine crystals exit the evaporator and leave the process. Of the caffeine entering the process a fraction of 0.960 leaves the process in this product stream.

a) What is the mass flow rate of crystallized caffeine (g caffeine/min)?

b) What is the mass flow rate of fresh CH2Cl2 to the process (g CH2Cl2/min)?

c) What is the ratio of the flow rates of recycled CH2Cl2 to fresh CH2Cl2?

A byte is made up of 8 bits although a byte is rarely represented as a string of binary digits or bits. Instead, it is typically presented as a pair of hexadecimal digits where each digit represents 4 bits or half a byte or "nibble." We have been reading in hex digits and outputting their decimal value, but what we really want to do is create a byte from a pair of hex digits read from input.

Create a C program that:

1. Reads a pair of hexadecimal characters from input. For example: 3B or CF.
2. Converts each of them into their decimal value. For example: 3 (0011 in binary) and 11 (1011 in binary)
3. Packs the two nibbles into a single byte. For example, 3 and B packed into an 8 bit byte would be 0011 1011.
4. Outputs the merged byte in hexadecimal to verify that the byte was packed correctly.

The printf() function supports outputting an integer as a hexadecimal number using the %x (where the hexadecimal letters are presented in lower-case) and %X (where the hexadecimal letters are presented in upper-case).

To pack two integers that have values represented with only 4 bits, you need to perform two operations with the integers:

1. Shift the integer holding the decimal value of the first hexadecimal digit in the pair to the left 4 bits.
2. OR the integer holding the decimal value of the second hexadecimal in the pair with the shifted integer.

After the shift and the OR, the first integer will not have the lower 8 bits (byte) set to the values represented by the two characters read from input.

Case study read the following case study:

best hospital is a 325-bed suburban community hospital ... Question: Case Study Read the following case study: Best Hospital is a 325-bed suburban community hospital ... Edit question Case Study Read the following case study: Best Hospital is a 325-bed suburban community hospital that has just merged with a local major academic medical center, the University of Excellence Medical Center (UEMC). There are 15 hospitals in the UEMC system, ranging from small rural hospitals with 50 or fewer beds to large multiple-specialty tertiary referral hospitals. Two hospitals in the system have achieved magnet status and several hospitals are working to achieve this status. Within the UEMC system, a high value is placed on collaboration with the schools of the health professions at the University of Excellence (UE). Best Hospital has a long history of association with local universities, functioning mainly as a site for student clinical experiences. For example, undergraduate students enrolled at the UE College of Health Professions often complete a portion of their clinical work at the hospital. Each year the hospital hires a number of graduates from this program. Several nurses in first-level management positions at the hospital are enrolled in the master’s program. The vice-president for clinical practice at Best Hospital is a PhD-prepared nurse who has been appointed to the faculty at the UE School of Nursing. Your current position is director of staff development at Best Hospital. You are responsible for the educational programming of all clinical staff. Over the past 2 years, Best Hospital has been fully involved in meeting Meaningful Use criteria. As director of staff development, you have played the major leadership role in developing and implementing all related educational programs. The health professional schools at UE are working together to revise their curricula to integrate informatics throughout. The goal is to develop an interprofessional approach that incorporates informatics across and throughout the different educational programs within these schools. The schools have requested a meeting with clinical leaders from the hospital to gain a practical perspective on what information should be included in the curricula. The vice-president for clinical practice has included you on the list of leaders to attend the meeting. She asked that each person attending the meeting prepare a short presentation on how they engage their staff in the continuous education process with respect to ever-changing healthcare technology.

Review the case study.

1. Give an overview process map on how staff training is linked to any update in healthcare technology for Best Hospital staff

2. List examples of computerized teaching tools used within staff training, including: List of learning tools typically used within staff training

3. How you determine which tools to use (rationale)

4.How such tools are used within the training process

Support of continuous learning by staff

1. Existing support mechanisms and processes

2. How continuous learning is linked to professional development

3. Examples of how learning is offered for diverse learning styles of staff

MARKETING QUESTION

Airbnb is one of the world’s largest marketplaces for unique, authentic places to stay and things to do, offering over 7 million accommodations and 40,000 handcrafted activities, all powered by local hosts. An economic empowerment engine, Airbnb has helped millions of hospitality entrepreneurs monetize their spaces and their passions while keeping the financial benefits of tourism in their own communities. With more than half a billion guest arrivals to date, and accessible in 62 languages across 191 countries and regions, Airbnb promotes people-to-people connection, community and trust around the world. Basically, Airbnb is an online community marketplace that connects hosts who want to rent out spaces in their home with guests who are looking for accommodations. Airbnb doesn’t own any lodging properties. It is a platform that just brings buyers and providers together and facilitates interactions between them. Bookings and payments are made the secure interface of Airbnb. For property owners or hosts, all they have to do is register their listing and provide photos and details of the property and decide on the price. For guests, they can search by country, location, size, and price then book based on what they are looking for and other guest reviews. Recently, Airbnb issued the following statement:

Airbnb’s mission is to create a world where anyone can belong anywhere through magical travel that provides unique, authentic and local experiences, and we are focused on reimagining travel by building an end-to-end travel platform that combines where you stay, what you do, and how you get there, all in one place.

From our origins in a San Francisco apartment, we have grown into a global community with hosts across more than 191 countries and 81,000 cities. Powered by network effects that began with our founding in 2008, today Airbnb is truly a global platform, with more than 5 million listings in over 191 countries. In 2013, there were nine city regions with at least 100,000 Airbnb guest arrivals; in 2018, there were over 350 city regions with at least 100,000 Airbnb guest arrivals.

This global growth is increasingly being powered by tourism to destinations in emerging markets. According to the World Travel & Tourism Council (WTTC), travel to emerging economies is expected to increase at twice the rate of travel to advanced economies from now until 2030. By 2030, more than 1 billion travelers will arrive in emerging economies annually.

Airbnb is especially well-positioned to be a major driver of this continuing growth. Airbnb’s popularity has long been built on a growing desire for authentic, local travel that takes guests off the beaten path, and in recent years the Airbnb community has surged across emerging destinations around the world, especially those in Asia Pacific, Africa, and Latin America. By 2030, Airbnb expects that over 400 million guests will have used the platform to arrive at listings in emerging markets since the company was founded.

The Emerging Markets: Powering Airbnb’s Global Growth report we prepared outlines the ways in which emerging markets are becoming an increasingly powerful segment of the Airbnb community (alongside the markets in developed countries such as U.S. and Europe), and highlights three themes: (1) The rise of emerging markets in global tourism; (2) Airbnb’s surging growth in emerging markets, including the world’s fastest-growing large economies: India and China; (3) How Airbnb’s infrastructure positions it for continuing success in emerging markets

Indeed, with its unique distribution, positioning, and pricing strategies, Airbnb is disrupting the room rental industry as well as related industries.

1) What are Airbnb's distribution, positioning and pricing strategies? (elaborate)

2) What isAirbnb offering as opposed to its competitors? Apply the marketing mix to explain the offering.

3) Outline Airbnb's communication strategy.

Your boss has a patent on Coyote Custom Churn, a remarkable new machine which allows customers at restaurants to create custom sodas using all Coyote Cola flavors and works equally well in high school and college chemistry labs to perform experiments and create solutions safely. As you can imagine, demand for Coyote Custom Churn is quite impressive: Q^D = 750 – .05 P. The technology for producing Coyote Custom Churn results in a total cost function of TC = 7,000 Q.

What quantity of output should we choose to produce, what price will we charge, and how much profit can we earn, as a profit maximizing monopolist?

How much consumer surplus, producer surplus, and deadweight loss results from the monopolization of this market (we will practice this in office hours if you have forgotten since ECON 201)? (Hint: A graph may be helpful here.)

If the patent expired and no barriers to entry remained, with all entrants using the same technology, what would a perfectly competitive market do in this market, in terms of price and quantity produced?

Question 6

A. Gigi recently inherited some bonds (face value $100,000) from her father, and soon thereafter she became engaged to Adrian, a Bond Business School marketing graduate. Ralf wants Gigi to cash in the bonds so the two of them can use the money to “live like royalty” for two years in Monte Carlo. The 2 percent annual coupon bonds mature on December 31, 2037, and it is now January 1, 2018. Interest on these bonds is paid annually on December 31 of each year, and new annual coupon bonds with similar risk and maturity are currently yielding 7 percent. If Gigi sells her bonds now and puts the proceeds into an managed fund that pays 5 percent compounded annually, what would be the largest equal annual amounts she could withdraw for two years, beginning today (that is, two payments, the first payment today and the second payment one year from today)?

B. “Cost of Capital always depends on the risk of the project being evaluated. Therefore company costs of capital are useless”. Is that correct? Evaluate the statement.

Allisson Russo is a 15 year old girl admitted to the Emergency Room with Right , lower quadrant pain. She is eventually diagnosed with appendicitis and scheduled for an appendectomy. After visiting Allison in the Er, the surgeon Alerts the Operating Room nurse, Ms. Wendy Harnes that the surgery will take place in an hour. Allison is HIV positive from emergency medical acre and blood transfusions that she received six years ago, following an auto accident. Allison does not know that she is positive, at the request of her parents, who are born high-powered attorneys. Allison tells Ms. Harnes that she used to to be involved in sports but has dropped these activities in school because of feeling more tired than usual. She thinks that her academic studies are simply requiring more of her attention , but her mother has suggested that perhaps she would be seeing a new doctor soon. Allison asks the nurse “ Do you think being tired at my age is a serious concern? I thought all teenagers feel like this. I feel that I have a serious health problem.” How should Ms. Hayes respond to Allison?