MANAGERIAL ECONOMICS.docx - MASTER IN BUSINESS ADMINISTRATION MANAGERIAL ECONOMICS(MPME 7113 ASSIGNMENT 2 PREPARED FOR AIN FARHA BINTI SALAHUDDIN

MANAGERIAL ECONOMICS.docx - MASTER IN BUSINESS...

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MASTER IN BUSINESS ADMINISTRATION MANAGERIAL ECONOMICS (MPME 7113) ASSIGNMENT 2 PREPARED FOR AIN FARHA BINTI SALAHUDDIN PREPARED BY [STUDENT NAME] [STUDENT ID] SUBMISSION DATE 20 JUNE 2020
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MANUAL OF ASSIGNMENT MPME 7113 – ASSIGNMENT 2 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. Reading and revising of slides, books and internet will help you to answer those questions. Submission: Softcopy: share in google classroom REMINDER : TOTAL MARKS 20% will be given upon completion and submission. 1% per day will be deducted for the late submission after due date.
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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. As the acting manager of the Amcott and the one overseeing the foreign language department, Ralph depended on the marketing information given to him, - despite the correctness of his sales forecast on acquiring the new software. He further relied on legal division for the advice on the contract, but the legal department did not predict the legal ramifications that may occur from the contract. As per the manager’s plan to utilize $20 million in purchase of the Magicword software, it depicted that $7 million will be generated annually; holding assumptions that no additional costs will be incurred. Contrary, a net present value projection of the software elucidates a loss to the Amcott. However, Ralph was not fired due to the mishaps depicted on
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the legal department, but due to his managerial inability- unable to utilize and process the given information to foresee any possible loss due to the time value of money.
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Samsung and Hynix Semiconductor to Cut Chip Production
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