Information about costs and investments

Assignment Help Finance Basics

Reference no: EM1353040

This is a fictional task in the sense that there is no concrete plan from Iacom as described in the task text. It applies information about costs and investments.

Task 1:

Iacom will in 2010 launch a mobile broadband with extreme transmission - 100 Mbits / second - based on the new 4G network. Management has asked for a report and recommendation with regard to what price they should be put on the product (annual subscription). The price will be justified in including the expected development in the market, competitors, distributors and segments.

They have invested about 950 million Norwegian kr in upgrading the network so that the new technology might work. Coverage will be equivalent to that for mobile phones. Assume that the variable unit cost is 200 kr (per year subscription), and that mobile broadband department (as do all sales and marketing efforts, including customer service) has a fixed cost of 20 million a year. When the product is sold through distributors like (Elbuy. Expert, etc.) calculated a gross profit of 30% (that is, that the distributor has a gross profit of 30%).

It is also not expected that you put you in the technological details of the mobile broadband other than that you have a good understanding of the more general aspects of the technology curve.

Since this is a task for the marketing is expected that using theory from the marketing subjects to analyze and solve the problem.

This is a report to management in the company of Iacom, which means that you primarily have to think about logic and facts in the report itself.

One should not refer to the theory in the main text, but use footnotes to substantiate the theory that you think it is correct.
Footnotes shall be listed behind the report.

Reference no: EM1353040

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