MASTER IN BUSINESS ADMINISTRATION

MANAGERIAL ECONOMICS
(MPME 7113)
ASSIGNMENT 1

PREPARED FOR
DR NOR SAIDI BIN MOHAMED NASIR

PREPARED BY
[STUDENT NAME]
[STUDENT ID]

SUBMISSION DATE
28 March 2021
MANUAL OF ASSIGNMENT

MPME 7113 – ASSIGNMENT 1

WRITING FORMAT
1. This assignment is to be completed INDIVIDUALLY.
2. This assignment is accordingly by chapters in the syllabus.
3. Answer ALL questions accordingly.
4. Please note that those questions are to be answered after accomplishment of every
chapters. Reading and revising of slides, books and internet will help you to answer
those questions.

SUBMISSION
Softcopy (upload your TURNITIN report with content @ Class ID: 27727418 @
Enrollment key: drsaidiME) into LMS.

REMINDER: TOTAL MARKS 25% will be given upon completion and submission.
1% per day will be deducted for the late submission after due date.
Amcott Loses $3.5 Million; Manager Fired

On Tuesday, software giant Amcott posted a year end operating loss of 3.5 million.
Reportedly, $1.7million of the loss stemmed from its foreign language division.

At a time when Amcott was paying First National a hefty 7 percent rate to borrow short-
term funds, Amcott decided to use a $20million of its retained earnings to purchase
three -year rights to Magicword, a software package that converts generic word
processor files saved as French text into English.

First year sales revenue from the software was $7million, but thereafter sales were
halted pending a copyright infringement suit filed by Foreign Incorporation. Amcott lost
the suit and paid damages of $1.7 million.

Industry insiders say that the copyright violation pertained to a very small component of
Magicword.

Ralph, the Amcott manager who was fired over the incident was quoted as saying, “I’m
a scapegoat for the attorneys who didn’t do their homework before buying the rights to
the Magicword. I projected annual sales of $7 million per year for three years. My sales
forecasts were right on target.

Do you know why Ralph was fired? Explain your answer.

Based on the question above, it is understandable that Ralph was not been fired because
the fault of the company meanwhile because of his managerial slowness. The cause of the
not in good order physical process the content which was authorized to Ralph. Basically,
Ralph didn’t realize the time period an its worth of money.

Being the head, the abroad communication section, Ralph would likely replied that the
income forecast was about the approaching sales was so straight, but seemingly Ralph
lawful department did not to the full valuate all the functionary complexity of administer the
magic word. Erstwhile, director given incorrect content.
Presumptuous there were zero different costs joint with the undertaking, the project’s net

present value to Amcott of buying Magicword will be as

PV = 7,000,000 + 7,000,000 + 7,000,000 - 20,000,000 (1+0.07)1 (1+0.07)2 (1+0.07)3

PV = - $ 1,629,788

Eventually this shows that, Ralph should aware that Amcott will misplace over $1.6 million
by buying Magicword. This is the reason why Ralph was fired.
Samsung and Hynix Semiconductor to Cut Chip Production

Sam Robbins, owner and CEO of PC solutions, arrived at the office and glanced at the
front page of The Wall Street Journal waiting on his desk.

One of the articles contained statements from executives of two South Korea’s largest
semiconductor manufacturers Samsung Electronics Company and Hynix semiconductor,
indicating that they would suspend all their memory chip production for one week. The
article went on to say that another large semiconductor manufacturer was likely to follow
the suit. Collectively, these three chip manufacturers produce about 30 percent of the
world basic semiconductor chips.

PC solutions is a small but growing company that assembles PCs and sells them in the
highly competitive market for “clones”. PC solutions experienced 100 percent growth
last year and is in the process of interviewing recent graduates in an attempt to double
its workforce.

After reading the article, Sam picked up the phone and called a few of his business
contacts to verify himself the information contained in the journal. Satisfied that the
information was correct, he called the director personnel, Jane Remak.

What do you think Sam and Jane discussed? Explain your answer.

Based on the question, Sam and Jane were actually discuss about the cut a chip industry

that has been finally make up the higher price of the chip. When it is known that the chips

is important for the production there is an increase in the price of chips that would

eventually decrease in the market supply of PC’s through a alteration in supply. Here, Sam

and June unregenerate the content of active ahead with their idea to dual the PC solutions’

work in this case.

B S2

D
Quantity of PC’s

Rising chips prices decrease the supply of PC’s

In order to instance, conceive of that negotiate a little retail outlet that exchange PC’s. The
big picture as the PC terms and gross sales will decline. The supply and demand
investigation is a quantitative implement which the position of the company’s merchandise,
accompanying commodity, shows the indispensable for the trading operations.
Boeing Loses the Battle but Wins the War

After nearly eight weeks, Boeing and its International Association of Machinist and
Aerospace Workers Union (IAM) reached an agreement that ended a strike involving
27,000 workers. The striker followed days of “last minute”, around the clocks talks that
began when management and union negotiators failed to reach an agreement over
compensation and job protection issues.

As a result of the agreement, IAM workers won benefits in areas that include healthcare,
pensions, wages, and job security for 2.900 workers in inventory management and
delivery categories. Boeing also agreed to retrain workers who are laid off or displaced.

Despite these concessions, a spokesman for Boeing was quoted as saying that the
agreement “gives us the flexibility we need to run the company”. The four-year
agreement allows Boeing to retain critical subcontracting provisions it won in past
struggles with the union.

Commenting on all this, one analysis concluded that “the union probably won the
battle and Boeing probably wins he war”. Can you explain what this analyst
means?

The psychoanalyst meant the statement of "the union probably won the battle and Boeing

in all probability wins the war" as the individual that are fighting for their own rights

eventually won the position of statement that they are war-ridden for and shows their

immense attainment for all of them. However, all these will never comes easy in upcoming,

but still with a expectancy towards Boeing the individual has the supernatural virtue that

they would get finished all these with a reciprocal respect to the request they asked for.

Here it shows that, the corporate workers has put on their postulation and asked for

whatever they merit to get. Thus, they preconditioned a black and white that has

mentioned points that were against by Boeing. Heretofore, Boeing has to token down a tiny

and accept the condition of the organized. This lead the northern to won the argument.
However, this conclusion leads to a huge misunderstanding between Boeing and the team.

Thus, as per analyst, is at all these work inaction occur in forthcoming, the win would

belongs to Boeing.
AT&T Puts Halt to T-Mobile Merger

A few years ago, the U.S. Justice Department filed suit to block the merger between
AT&T share of the wireless subscription market at 32 percent, while T -mobile ‘s share
was 10 percent. This market had two other major competitors: Verizon with a 34 percent
share and Sprint with a 17 percent share. After spending million on merger plans, AT&T
decided to call off the deal. The impact on AT&T bottom line was so significant that its
CEO saw his pay cut by $2million as a result.

Do you think AT&T should have spent millions on merger plans in the first place?
Explain your answer.

There is no necessity for AT&T to invest millions without comely due carefulness and the
belief investigation. Thus, the establishment should have guarantee that the
administration that it is in reality being intercommunicate with their organization’s
morganatic counselor and business broad for persuasion whether the agreement
continue by the AT&T inflect and does it severance or infarct any of the active law that
has been occupied in the compatibility that would have reclaimed millions in legal
instrument and organization defence mechanism.

Therefore, AT&T inflect and does it break or go against of the aforementioned conception
of supremacy, business firm trust or change of magnitude of the market business relation.
This would have make a profit of a millions in legal document and governance costs and
time period. The occupational group action one should carried out and that will be all-
purpose for classification to influence if it is an discernment that has been tolerate by AT&T
make up one's recollection and does it falling out or go against any of the said construct of
domination, consortium or the drop of the market contention.
McDonald’s New Buzz: Specialty Coffee

Not long ago, McDonald’s unveiled plans to roll out McCafe in the United Stated, a
premium line of coffee that includes cappuccino, latte and iced mocha. The recession
during the late 2000s in the United States left some analyst questioning whether it was
the right time for McDonald’s to roll out its line of new specialty drinks. However,
McDonald’s quickly saw a tripling of its share of U.S. coffee sales.

Why do you think McDonald’s embarked on that program, and related, what do
you think was the source of its success? Do you think this new product line will
sustain its impact on the company’s bottom line? Explain your answer.

McDonalds is one of the most favourite fast food provider that has been the most amicable
for all the people around the globe. Thus, when there is an innovation and new product in
market as McCafe, the expectation soar and as well as McDonald's could eventuality
construe with the grandness of the high financial gain only if the arrangement got into a
immense quantity of custom-made for their coffee. Hence, the customized could consider
potable to their nutrition, decelerate the median disbursement at the shop extremity. All the
same, it might be challenging for McDonald's to actuation in coffee-only clients to its
mercantile establishment. As we all know that coffee has been the most favorable drink for
everyone especially when it comes to a busy day.

Not just that, the disposition that the fast food merchandising outlet has answer as the
physical carriage of McCafe. As we noticed, the positive identification of McCafe wide-open
up of scheme eating choices and is relatively cheap than its contestant. This is
manageable exclusive because of efficacious disbursement cold carrying out and
assemblage bespoken skillfulness in which McDonald’s is an practiced that has kept the
McCafe to be sustainable in the securities industry.
Mickey Mouse Lets You Ride “for Free” at Disney World

Walt Disney World Theme Parks offer visitors a wide variety of ticket choices. The one
thing these tickets options have in common is that they entail a fixed entrance fee and
allow customers to take as many rides as they want at no additional charge. For
instance, by purchasing a 1- day ticket for about $105, a customer gains unlimited
access to the park of her choice for one day.

Wouldn’t Disney earn higher profits if it charged visitors, say $10.50 each time
they went on a ride? Explain your answer.
At first, Disney would not make profit if at all they had change the plan to charge the
customer for per entry chargers for the visitors. This is due to when they have the decision
making of $105 for bottomless entry it will heighten the traveler to come to Disney, but
when the asseveration same is to one ground, the traveler would human activity with one
visit to a topographic point when they were negatively charged with additive remuneration.

Therefore, when there is a charged gross as $105 for untrammeled visit, whether if they
impoverishment it or not they will be need to go approximately for once, it will
unquestionably indefinite quantity earnings if they compute as for per knowledge.

Thus, supported on my thought, the billing of $105 would be a groovy cognitive content as
we similitude with the additive courser for per coming together as $10.50 as the numbers
racket of visitors handle tickets also incised downward.