MBA MFT Study Cards

MBA MFT Study Cards major segmentation variables (4) - Answer-(1) geographic, (2) demographic, (3) psychographic, (4) behavioral penetrated market - Answer-set of customers who are buying the company's product target market - Answer-qualified available market the company decides to pursue available market - Answer-set of consumers who have interest, income, and access to a particular offer potential market - Answer-set of consumer with a sufficient level of interest in a market offer corporate culture - Answer-shared experiences, stories, beliefs, & norms that characterize an organization strategic marketing plan - Answer-lays out the target market and the firm's value proposition, based on an analysis of the best market opportunities 5 stages of consumer buying process decision process - Answer-(1) need recognition, (2) information search, (3) evaluation of alternatives, (4) purchase decision, (5) postpurchase behavior 8 steps of business purchasing process - Answer-(1) identify need, (2) select specific product, (3) appoint purchase team, (4) specify technicalities, (5) budget for purchase, (6) research potential suppliers, (7) solicit bids, (8) award contracts 4 factors influencing consumer behavior - Answer-(1) cultural, (2) social, (3) personal, (4) psychological 4 factors that influence business purchasing behavior - Answer-(1) environmental, (2) organizational, (3) interpersonal, (4) individual competitive intelligence - Answer-defining, gathering, analyzing, & distributing intelligence about products, customers, competitors, and any aspects of the environment needed to support executives & managers making strategic decisions for an organization managerial decision making process steps (6) - Answer-(1) establish the objective, (2) define the problem, (3) identify possible solutions, (4) evaluate alternative courses of action, (5) implement the decision, (6) acquire feedback 8 major models of marketing communication - Answer-(1) advertising, (2) sales promotion, (3) events & experiences, (4) public relations & publicity, (5) direct marketing, (6) interactive marketing, (7) word-of-mouth marketing, (8) personal selling pull strategy - Answer-the manufacturer uses advertising and other communication to persuade consumers to demand the product from intermediaries, thus inducing intermediaries to order it push strategy - Answer-uses the manufacturer's sales force, trade promotion money, or other means to induce intermediaries to carry, promote, & sell the product to end users points-of-parity (POPs) - Answer-attributes or benefit associations that are not necessarily unique to the brand but may be shared with other brands points-of-difference (PODs) - Answer-attributes of benefits that consumers strongly associate with a brand, positively evaluate, and believe they could NOT find to the same extent with a competitive brand posititioning - Answer-the act of designing a company's offering and image to occupy a distinctive place in the minds of the target market supersegment - Answer-set of segments sharing some exploitable similarity 5 key criteria market segments must rate favorably on to be useful - Answer-(1) measurable, (2) sustainable, (3) accessible, (4) differentiable, (5) actionable pyschographic - Answer-the science of using psychology & demographics to better understand consumers variables of demographic segmentation (6) - Answer-(1) age and life-cycle stage, (2) life stage, (3) gender, (4) income, (5) generation, (6) race & culture investment banking - Answer-a specific division of banking related to the creation of capital for other companies, governments, and entities weak form - Answer-assumes that all info contained in past price movements is reflected in the current market price. info about recent trends in a stock price is no use in selecting a stock semi-strong form - Answer-states the current market price reflects all publicly available information. to gain abnormal returns insider info is needed information efficiency - Answer-all relevant information about a stock is reflected in its price (this is in a perfect world) strong form efficient - Answer-all info -- public and insider -- is reflected in the market price. no abnormal returns market efficiency - Answer-the degree to which stock prices reflect all available relevant information money market - Answer-a segment of the financial market in which financial instruments with high liquidity and very short maturities are traded capital markets - Answer-markets for buying and selling equity and debt instruments security - Answer-a financial instrument that represents an ownership in a publiclytraded corporation (stock), a creditor relationship with governmental body or corporation (bond) or rights to an ownership as represented by an option most common underlying assets of derivatives - Answer-stocks, bonds, commodities, currencies, interest rates, market indexes derivative - Answer-a security with a price that is dependent upon or derived from one or more underlying assets. its value is determined by fluctuations in the underlying assets futures - Answer-financial contracts obligating the buyer to purchase an asset (or the seller to sell an asset) at a predetermined future date and price option - Answer-a financial derivative that represents a contract sold by one party (option writer) to another party (option holder). the contract offers the buyer the right to call or put a security at an agreed upon price (strike price) during a certain period of time or on the exercise date 2 types of financial instruments - Answer-(1) cash instruments, (2) derivative instruments financial instruments - Answer-assets that can be traded INVENTORY TURNOVER = - Answer-SALES/INVENTORY AVERAGE COLLECTION PERIOD = - Answer-DAYS (ACCOUNTS RECEIVABLE)/CREDIT SALES WORKING CAPITAL RATIO= - Answer-CURRENT ASSETS/CURRENT LIABILITIES working capital managment - Answer-a company's managerial accounting strategy designed to monitor and utilize the 2 component of working capital -- current assets and current liabilities 3 main dividend policies - Answer-(1) residual dividend policy, (2) dividend stability policy, (3) hybrid dividend policy dividend policy - Answer-a set of guidelines a company uses to decide how much of its earnings it will pay out to shareholders WACC = - Answer-WdRd(1=T) + WpsRps + WsRs cost of capital - Answer-the opportunity cost of making a certain investment capital budgeting - Answer-the whole process of analyzing projects and deciding whether they should be included in the planned expenditures on fixed assets what are some types of real options? - Answer-(1) investment timing options, (2) growth options, (3) abandonment options, (4) flexibility options real options - Answer-exist when managers can influence the size and risk of a project's cash flows by taking different actions during the project's life in response to changing market conditions what 3 types of risk are relevant in capital budgeting? - Answer-(1) stand alone risk, (2) corporate risk, (3) market [beta] risk steps in capital budgeting - Answer-(1) estimate cash flows, (2) assess risk of cash flows, (3) determine r [WACC], (4) evaluate cash flows THE DUPONT EQUATION - Answer-(1) ROA = [NY/SALES] [SALES/TA] = NY/TA (2) ROE = [NY/TA] [TA/EQUITY] = NY/EQUITY components of risk - Answer-(1) default risk, (2) maturity risk premium, (3) liquidity premium why would a company have a target capital structure? - Answer-recognize debt is cheaper, but too much debt increases cost of debt, which increases default risk and looks bad efficient frontier - Answer-the set of optimal portfolios that offers the highest expected return for a defined level of risk or the lowest risk for a expected level of return WACC (definition) - Answer-the weighted average of the after-tax components cost of capital -- debt, preferred stock, and common equity byproduct - Answer-a product of relatively small total value produced simultaneously with a product of greater total value methods of byproduct costing - Answer-(1) byproducts could be valued at the split-off point at their net realizable value (2) none of the common costs is assigned to the byproducts job costing vs. process costing - Answer-- job costing is used for unique products, process costing is for standardized - job costing is for small production runs, process costing for large production runs - job costing is more likely to be used for billing to customers activity based costing (ABC) - Answer-firm assigns costs to the activities that are the real cause of the overhead, then assigns the costs of those activities only to the products that are actually demanding the activities absorption vs. variable costing - Answer-absorption includes all costs, including fixed costs, in figuring the cost of production, while variable costing only includes the variable costs related to production UNITS FOR TARGET PROFIT = - Answer-X = (TFC/[UP-UVC]) + TP cost behavior - Answer-the change in total costs in response to the change in some activity - costs that vary proportionately with the changes in the level of activity are variable costs, unaffected are fixed costs options for transfer pricing (4) - Answer-(1) market based, (2) variable-cost, (3) full-cost, (4) negotiated TOTAL COST - Answer-TC = UVC(UNITS) + TFC BREAK EVEN POINT = - Answer-BEP = TFC/(UP - UVC) or... TFC/UCM variance analysis - Answer-the quantitative investigation of the difference between actual and planned behavior cash budget - Answer-financial budget prepared to calculate the budgeted cash inflows and outflows during a period and the budgeted cash balance at the end of the period 3 ways to analyze sell-or-process further - Answer-(1) incremental (or differential), (2) opportunity cost, (3) total project approach sell-or-process further - Answer-whether to sell a joint product at split-off point or to process it further and sell it in a more refined form special orders - Answer-a one-time customer order, often involving a large quality and a low price Continues...