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Colonial Homes Case Questions

Colonial Homes Case Questions - EWMBA 201a Fall 2009-Vrdy...

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EWMBA 201a Fall 2009—Várdy Case Preparation Discussion Questions: Colonial Homes Answer and be prepared to discuss the following questions: 1. Before the Davey price increase, was Colonial Homes’ price too high or too low? What evidence do we have? 2. Were the proposed 1989 prices profit-maximizing under the assumption of a 2.5% price increase from Davey Lumber? If not, what adjustment should be made and what would the predicted profits be? 3. How should Noel adjust prices from the original proposal if Davey’s prices
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