Reference no: EM13749207
Decision Analysis
New Product Introduction
You are a marketing manager for a newly developed tablet computer - ISurf. You are considering whether your company needs to produce this product or not. You estimate that the market for ISurf will be either strong or weak. Furthermore, the information you gathered so far about the potential market for table computers and lour intuition suggest the following:
• If the market for the product becomes strong, then your company will earn $18 *million on sales.
•If the market for the product becomes weak, then your company will lose $8 million due to not being able to cover your production costs.
You know that your competitors are also bringing up new products. Based on your experience and intuition about similar products that your company introduced in. 'the past, you estimate that there is a 30% chance that the market for this new product will be strong; and, similarly, there is a 70% chance that the market for this new product will be weak.
Before you decide whether or not to introduce this new tablet computer, you would like to gather more information from potential consumers through a market survey. This market survey may result in two outcomes:
• Positive result → indicates that the market for the new product will be strong
• Negative result → indicates that the market for the new product will be weak
You estimated that the cost of the market survey will be $2.4 million. You are aware of the following known facts about the reliability of market surveys:
• Market surveys cannot predict the market for new products with certainty,
• Market surveys sometimes misread the market for new products.
You have the following past data about market surveys that you carried out on similar products:
• If the market is weak, there is a 10% chance that the market survey will be positive.
• If the market is strong, there is a 20% chance that the market survey will be negative.
As a marketing manager, possible actions you can take:
-You can decide not to produce this new tablet computer at all, or
-You can decide to produce this new tablet computer, or
-You can decide to carry out the market survey first, and then depending on the result of the market survey, you can decide whether to produce or not to produce
What should be your decision strategy for ISurf?
|
What is the difference between products and services
: What is the difference between products and services? How might that affect accounting? Why wouldn’t the current product cost accounting provide useful information for the expansion into the two new product lines? How would the pilot projects allow B..
|
|
Are you satisfied with the new government
: Are you satisfied with the new government under the recently ratified Constitution? Do you think your 20-something year old self (the protester from the 1760s) would be happy with the way things turned out?
|
|
Relationship between finance and accounting
: Write a paper of 500-750 words that explains the relationship between finance and accounting, and how they operate to determine financial viability within a health care organization. Minimum of three references in APA style guidelines
|
|
Create a plan for negotiating the best finance option
: Analyze the finance options available for purchasing your new home and determine the advantages and disadvantages of each option. Create a plan for negotiating the best finance option for both the seller and the buyer.
|
|
What should be your decision strategy for isurf
: ou are a marketing manager for a newly developed tablet computer - ISurf. You are considering whether your company needs to produce this product or not. You estimate that the market for ISurf will be either strong or weak. What should be your deci..
|
|
Considering investing in a company
: You are considering investing in a company. Which financial ratios would you find most useful?
|
|
The manager of a company manufacturing air-conditioning un
: Jane, the manager of a company manufacturing air-conditioning units can choose between two production technologies for a new product line. If she chooses and installs technology 1, the yearly costs will be C1(q) = 3600 + 65q + 36q2. If she installs ..
|
|
Determine the three most important issues
: Commercial property usually costs a lot more than an ordinary house; so many businesses prefer to lease the property. Determine the three most important issues to you if you were trying to negotiate a commercial property lease.
|
|
What is mark to market accounting
: What is mark to market accounting? Which stakeholder do you think will be most affected in mark to market accounting? Identify two critical accounts that will be most affected by the suspension of mark to market.
|