Notes, summaries, assignments, exams, and problems for Economics

Key Concepts in Product Development

What is the Most Expensive Stage of New Product Development?

Product commercialization often turns out to be the most expensive and risky part of the new product development process due to the financial commitments to both production and marketing once the go-ahead is given.

Understanding Strategic Givens in Product Launch

Strategic givens are strategic decisions that may have already been made before the strategic launch planning begins.

Types of Strategic Platform Decisions

• Permanent: "We are in to stay."
• Permanent, but as a Bridge to Other Items (Platform Strategy): "We are in to stay if we meet our goals."
• Temporary: Given firms’ tendency to develop streams of products, more and more new products are actually

External Environment Tools

PESTEL Analysis

List of influences on the possible success or failure of strategies:

• Political Factors: Government policies, taxation changes, trade regulations. Zara's corporate social responsibility is transparent; Zara collaborates with communities in its areas of operation and has a code of conduct.
• Economic Factors: Business cycles, interest rates, GDP trends. Zara conducts deep consumer research and acts in a unique way. Export and import concerns affect performance.
• Social-Cultural Factors: Population changes, income distribution. Zara has a good image through donations and charity. Zara embraces diverse cultures, and its brand is known worldwide.
• Technological Factors: ICT innovations, new discoveries, and technological

Core Commercial Service Logistics Parameters

From a logistics perspective, commercial services fundamentally rely on three key parameters:

• Merchandise availability for immediate delivery to the client.
• Quick merchandise delivery.
• Reliability of the promised delivery date to the customer.

Warehouse Definition and Challenges

A warehouse is a "planned space for the efficient location and handling of materials and merchandise." Warehouses aim to solve two primary problems:

• Correct layout design.
• Efficient handling of operational processes (product inputs and outputs).

Warehouse Operational Processes

A warehouse can be considered a production center where a series of processes are carried out:

• Receiving merchandise.
• Product adaptation (packing, labeling, etc.

TEMA 1

1.4. Subjects of Strategic analysis: Model of the five Competitive Forces (M. Porter). S.W.O.T.: System to diagnose company’s internal and external competitive position when setting strategic objectives weaknesses threats strengths and opportunities. 1.8. Strategic Planning: Is the process of setting long term objectives, analyzing internal strengths and weaknesses and compromising needed resources to prevent threats and profit from opportunities

People M&D Leadership Investors, leaders and associates Global Economy Collaborate 1990-Actual Human Capital Management Owners, managers, trade unions and collaborators International Economy Compete 1960-1990’s Human Resources Owners, HR dpt, trade unions and employees Economic Recovery

Understanding Incentive Types & HR Strategy

This document explains various types of incentives: individual, group, and organizational incentives, and their integration with HR strategy. It also touches upon specific elements of a compensation package.

Individual Incentives Defined

Individual incentives are rewards based on the personal performance of employees. They are directly linked to individual performance behaviors and outcomes.

Group Incentives Defined

Group incentives are rewards based on the collective performance of teams or an entire organization.

Common Approaches to Base Pay

Two basic methods are commonly used to determine base pay:

• Point Systems

  Each job is evaluated within a range of points, and base pay is set at a higher level for

Chapter 1: Introduction to Economics

Economics is the study of how we choose to use resources to produce goods and services. There are four factors of production:

• Land: Natural resources, such as grass
• Labor: Human effort, such as work
• Capital: Tools and machinery used in production
• Entrepreneurship: The ability to combine the other factors of production to create goods and services

When making economic decisions, we consider marginal benefit (MB) and marginal cost (MC). If:

• MB > MC: It is beneficial to proceed
• MB = MC: This is the break-even point
• MB < MC: It is not beneficial to proceed

Economic theory simplifies economic reality, while economic policy involves remedial actions taken to solve economic problems. Economic goals include economic...

Leases

• Operating lease: a shorter-term lease under which the lessor is responsible for insurance, taxes, and upkeep, cancelable by lessee on short notice.
• Financial lease: a longer-term, fully amortized lease which the lessee is responsible for maintenance, taxes, and insurance. Not cancelable without penalty.
• Leveraged lease: a tax-oriented lease in which the lessor borrows a substantial portion of the purchase price of the leased asset on a nonrecourse basis.
• Sale and leaseback: occurs when a company sells an asset it owns to another party and simultaneously leases it back.
• Capital lease: transfer ownership to lessee by the end of the term, lesses purchase the asset at a price below fair market value when lease expires, >75% economic life,

MARKET VALUE PERFORMANCE MEASURES

MVA

Market Capitalization = (#shares * price per share) - Equity

MTBR

Measures how much value has been added for each dollar that shareholders have invested = MVOEQUITY / BVOEQUITY

MEASURING PROFITABILITY

EVA

Economic Value Add or Residual Income = The profit after deducting all costs including the cost of capital = After-tax operating income (after tax interest + NI) - (cost of capital * total capitalization at the start of the year) = ((1- tax rate)(interest expense) + NI) - (cost of capital)(long term debt + total equity beginning of year)

ROE

NI / Equity start

ROA

(1-tax rate) * interest expense + NI / Total Assets start

ROC

(1- tax rate) * interest expense + NI / LTD start + Equity start

MEASURING EFFICIENCY

How effectively...

The Market

Producer and Consumer Markets

The market is the space where sellers and buyers meet to achieve their objectives. In consumer markets, the consumer buys the product for consumption. However, when products are sold for use in the production process, this is known as a producer market.

Market Segmentation, Targeting, and Positioning

Definition of Segmentation

Through market segmentation, companies divide large, heterogeneous markets into smaller segments that can be reached more efficiently and effectively.

Segmentation Methods

A market segment is a group with similar needs and wants. There are various ways in which a market may be segmented, including:

• Geographic Segmentation: This focuses on the impact of factors such as the location of customers

Understanding Tourism Systems

Elements of Leiper's Tourism System

Tourist: The human element, individuals on tourist trips.

Traveler Generating Region (TGR): The origin of tourist trips, where they begin and typically end.

Tourism Destination Region (TDR): The location where tourists engage in their main visiting activities.

Transit Routes: The paths tourists take between TGR and TDR, where their main traveling activity occurs.

Tourism Industry: A collection of organizations providing tourism-related services.

Tourism Demand

Three Major Concepts:

1. Effective Demand: The actual number of people participating in tourism.
2. Suppressed Demand: Individuals who desire to travel but are unable to due to various constraints.
3. No Demand: Those with no interest in traveling.