Course Design Guide MBA/5004

South University Online

Course Description

Course Design Guide

School of Business MBA/5004 Managerial Economics

This course provides an overvie of microeconomic concep!s and applica!ions !o common "usiness pro"lems# Topics include suppl$ and demand anal$sis% cos! anal$sis% economies of scale% "asic mar&e! !$pes and !heir charac!eris!ics% pricing% ris& anal$sis% and !he governmen!'s role in economic affairs#

Policies
This page provides informa!ion a"ou! re(uiremen!s% fac!ors% policies% and prac!ices !ha! are impor!an! !o $our success as a s!uden! a! Sou!h )niversi!$ *nline# +lease revie sec!ions in !he Sou!h )niversi!$ *nline ca!alog !ha! per!ain !o ,ns!i!u!ional +olicies and Academic +olicies and +rocedures# Also visi! o!her lin&s on !his page !o read a"ou! online course a!!endance and par!icipa!ion% academic in!egri!$% scholarl$ ri!ing% and grading# ,n addi!ion% please familiari-e $ourself i!h !he resources and services availa"le !o $ou "$ revie ing informa!ion provided in !he Academic .esources page# +lease .ead and .espond# *nce $ou have read !he informa!ion and policies iden!ified a"ove please indica!e !ha! $ou have done so and !ha! $ou unders!and i! "$ pos!ing a response in !he Discussion Area "elo # Do no! proceed !o Week 1 un!il $ou have done so#

Course Materials
/irsche$% M# 010023# Fundamentals of managerial economics# Cengage 4earning# .e!rieved from h!!p5//m$eclassonline#com

Course Design Guide MBA/5004

Week One: Introduction to Managerial Economics

Details
Overview This ee&% $ou ill learn a"ou! !he fac!ors !ha! influence managemen! decisions# Managemen! decisions mus! "e made considering !he opera!ions and circums!ances no! onl$ i!hin !he compan$ "u! also i!hin !he economic environmen! ou!side !he compan$% hich includes o!her similar companies and !he econom$ in general# ,n !his ee&% $ou ill e6amine5

Point s

The a$ decision ma&ers incorpora!e &no ledge of !he economic environmen! !o ma&e "e!!er decisions The "asic economic rela!ionships of cos!s and revenue involved in !he decision7ma&ing process The "asic suppl$ and demand rela!ionships and !he a$ !hese concep!s lead !o mar&e! e(uili"rium

These rela!ionships allo managemen! !o address !he issues i!hin !he compan$% as ell as !hose in !he general econom$% hen ma&ing decisions !ha! can de!ermine !he profi!a"ili!$ of !he compan$ and even i!s e6is!ence in !he long !erm# Readings Read Week 1 online lec!ures 8rom $our course !e6!"oo&% Fundamentals of managerial economics% read !he follo ing chap!ers5 ,n!roduc!ion !o managerial economics Basic economic rela!ions Participation Assignment #1 Autobiography Demand and suppl$

Participate in class discussion# B$ Thursday, Novem er !", !#1$% pos! a "rief au!o"iograph$ !o !his Discussion Area# ,n!roduce $ourself !o !he class and ou!line $our reasons for !a&ing !he course% $our career aspira!ions% and an$!hing else $ou ish !o share i!h !he class# 9our in!roduc!ion should cover !he follo ing de!ails5 :ame 4oca!ion +rofession ;0

Course Design Guide MBA/5004

<or& or professional e6perience% especiall$ if i! per!ains !o !he managerial field E6pec!a!ions from !his course and in!eres! in i!s specific aspec!s

B$ !he end of !he ee&% revie and commen! on !he au!o"iographies of $our classma!es# Commen! on !he e6pec!a!ions $our peers have from !he course# Assignment #!
Discussion Questions

The ins!ruc!or ill assign $ou ! o (ues!ions from !he discussion (ues!ions lis!ed "elo # Chec& !he appropria!e Discussion Area !o see hich (ues!ions have "een assigned# B$ %riday, Novem er !&, !#1$% respond !o !he assigned discussion (ues!ions and su"mi! $our responses !o !he appropria!e !opic in !his Discussion Area# .espond !o !he assigned (ues!ions using !he lessons and voca"ular$ found in !he reading# Suppor! $our ans ers i!h e6amples and research and ci!e $our research using !he A+A forma!# S!ar! revie ing and responding !o !he pos!ings of $our classma!es as earl$ in !he ee& as possi"le# .espond !o a! leas! ! o of $our classma!es# +ar!icipa!e in !he discussion "$ as&ing a (ues!ion% providing a s!a!emen! of clarifica!ion% providing a poin! of vie i!h a ra!ionale% challenging an aspec! of !he discussion% or indica!ing a rela!ionship "e! een one or more lines of reasoning in !he discussion# Discussion 'uestion 1( Man$ "elieve !ha! !he s!ud$ of economics "elongs in !he classroom or in !he area of governmen! polic$ decisions "ecause economics is no! an e6ac! science and onl$ provides us i!h !heories on ho an econom$ or&s# Can $ou dispu!e !his idea= Can economics "e used in a managerial con!e6! or in !he decision7ma&ing process of "usiness firms= ,f so% ho = ,f no!% h$ no!= Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers# Discussion 'uestion !( Consider !his s!a!emen!5 >To ma&e effec!ive decisions% managers mus! use "asic cos! and revenue rela!ionships#> <ha! are cos! and revenue rela!ionships= Descri"e !hem in de!ail# <ha! is !he difference "e! een marginal and incremen!al anal$sis= /o can !he me!hodolog$ and !ools of managerial economics help in decision ma&ing= Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers#

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Course Design Guide MBA/5004

Assignment #$
Midweek Assignment

9our ins!ruc!or ill assign $ou one of !he !opics for $our assignmen!# +os! $our documen! !o !he appropria!e W1( Assignment $ Drop o) "$ Week 1, Day *# ?ramer Smi!h Case ?ramer Smi!h o ns a dr$7cleaning service and is !hin&ing a"ou! changing his adver!ising e6pendi!ures for !he $ear# /e hires $ou as a consul!an! !o de!ermine !he rela!ionship "e! een sales% consumer incomes% and adver!ising "$ means of mul!iple regression anal$sis# Smi!h has ga!hered !he sales% income% and adver!ising da!a for !he las! $ear% as sho n in Ta"le @# Clic& here !o vie Ta"le @#

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Crea!e a repor! ans ering !he follo ing (ues!ions5 Cons!ruc! a sca!!er graph sho ing !he adver!ising and sales rela!ionship over !he las! ! elve mon!hs# )sing mul!iple regression% conduc! an anal$sis of !he firm's sales revenue% consumer incomes% and adver!ising# Descri"e ho $ou ould e6plain $our resul!s !o Smi!h and ha! recommenda!ions $ou ould sugges!# Summari-e $our recommenda!ions or advice !o Smi!h concerning !he rela!ionship "e! een sales% income% and adver!ising#

Crea!e $our repor! in a 17 !o ;7page Microsof! <ord documen!# :ame $our repor! S)AMBA5004A<@AA;A4as!:ameA8irs!,ni!ial#doc# Su"mi! $our repor! !o !he W1( Assignment $ Drop o) "$ Week 1, Day *# Ci!e an$ sources using !he A+A forma! on a separa!e page# Assignment #*
Final Project

8or !he final proBec! for !his course% each ee&% $ou ill e6amine several !opics regarding !he economic anal$sis of a compan$ and !he environmen! in hich i! opera!es# ,n $our repor!% $ou ill use all !he (uan!i!a!ive and (uali!a!ive !ools discussed in class !o e6amine% evalua!e% and presen! !he informa!ion re(ues!ed each ee&# Earl$ in Week 1% $ou need !o selec! a compan$ of in!eres! !o $ou# <hile selec!ing a compan$% ensure !he follo ing5

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Course Design Guide MBA/5004

,nforma!ion a"ou! !he compan$ is readil$ availa"le# The compan$ is lis!ed on one of !he maBor s!oc& e6changes# The compan$ is no! a financial or insurance compan$#

Af!er selec!ing !he compan$% su"mi! !he associa!ed informa!ion !o !he ins!ruc!or% re(ues!ing approval# All informa!ion used in $our research mus! "e !he mos! curren! da!a availa"le# .epor! @5 Con!en! Templa!e Discuss !he suppl$ and demand as ell as elas!ici!$ concep!s of !he chosen compan$# ,ncorpora!e !hese concep!s in!o an anal$sis !ha! ill valida!e ho !he compan$ es!a"lishes i!s pricing s!ra!eg$# ,n $our anal$sis of !he compan$5 ,nclude !he follo ing informa!ion a"ou! !he compan$ and summari-e $our findings5 <here is !he compan$Ds corpora!e office loca!ed= /o man$ $ears has !he compan$ "een in "usiness= <here are !he differen! mar&e!s for !he compan$ loca!ed orld ide= o <ha! are !he compan$Ds maBor produc! lines% and ha! is !heir significance !o !he compan$ in !erms of revenues and cos!s= o <ha! are !he fea!ures of !he compan$Ds produc!s= <ha! is !he degree of similari!$ "e! een !he fea!ures of !he produc!s= o <ho is !he compan$'s maBor compe!i!ion= o <ha! are !he respec!ive mar&e! shares "eing serviced "$ !he compan$= 4is! !he u!ili!ies !he compan$Ds produc!s provide !o consumers# ,den!if$ and enumera!e !he fac!ors affec!ing !he suppl$% demand% and price for !he compan$Ds produc!s# E6amine he!her !he demand for !he compan$Ds produc!s is rela!ivel$ price elas!ic or rela!ivel$ price inelas!ic and e6plain h$# )sing mul!iple regression anal$sis% conduc! an anal$sis of !he rela!ionship "e! een sales levels% income levels% and !he emplo$men! level in !he overall econom$ over !he las! ! elve mon!hs# E6plain in de!ail $our findings and recommenda!ions using !he appropria!e indica!ors from $our anal$sis# *n !he "asis of $our anal$sis% sugges! ini!ia!ives !o improve !he revenue of !he compan$# o o o

Course Design Guide MBA/5004

Crea!e $our repor! in a 17 !o ;7page Microsof! <ord documen!# :ame $our repor! S)AMBA5004A<@AA4A4as!:ameA8irs!,ni!ial#doc# Su"mi! $our repor! !o !he W1( Assignment * Drop o) "$ Wednesday, Decem er *, !#1$# Ci!e an$ sources using !he A+A forma! on a separa!e page#

Course Design Guide MBA/5004

Week

!o: Demand and Supply "unctions

Details Point s

Overview

4as! ee&% $ou learned a"ou! !he na!ure of managerial economics# 9ou learned !ha! !he "asic goal of a compan$ is !o ma6imi-e i!s value# 9ou also revie ed ha! !he "asic economic rela!ionships are "e! een cos!s and revenues and ho !he$ affec! !he decision7ma&ing process of managemen!# 8inall$% $ou e6amined !he or&ings of !he mar&e! in !erms of suppl$ and demand# ,n Week !% $ou ill e6amine !he demand and suppl$ func!ions# 9ou ill anal$-e ho !hese func!ions are influenced "$ various fac!ors# 9ou ill discuss concep!s of u!ili!$ !heor$ and elas!ici!$ and o"serve ho elas!ici!$ affec!s pricing decisions# 8inall$% $ou ill learn ho companies mus! use !ools such as a cos!7volume7profi! 0CE+3 anal$sis in !he decision7ma&ing process in order !o achieve mar&e! "alance in !he shor! !erm and !he long !erm#
Readings Read Week ! online lec!ures 8rom $our course !e6!"oo&% Fundamentals of managerial economics% read !he follo ing chap!ers5 Demand anal$sis and es!ima!ion Participation Assignment #1
Discussion Questions

Cos! anal$sis and es!ima!ion

Participate in class discussion#

The ins!ruc!or ill assign $ou ! o (ues!ions from !he discussion (ues!ions lis!ed "elo # Chec& !he appropria!e Discussion Area !o see hich (ues!ions have "een assigned# B$ %riday, Decem er +, !#1$% respond !o !he assigned discussion (ues!ions and su"mi! $our responses !o !he appropria!e !opic in !his Discussion Area# .espond !o assigned (ues!ions using !he lessons and voca"ular$ found in !he reading# Suppor! $our ans ers i!h e6amples and research and ci!e $our research using

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Course Design Guide MBA/5004

!he A+A forma!# S!ar! revie ing and responding !o !he pos!ings of $our classma!es as earl$ in !he ee& as possi"le# .espond !o a! leas! ! o of $our classma!es# +ar!icipa!e in !he discussion "$ as&ing a (ues!ion% providing a s!a!emen! of clarifica!ion% providing a poin! of vie i!h a ra!ionale% challenging an aspec! of !he discussion% or indica!ing a rela!ionship "e! een one or more lines of reasoning in !he discussion#
Discussion 'uestion 1( *ne of !he maBor concerns of managers and managerial economics is !he demand for a compan$Ds produc!# Man$ fac!ors influence !he demand curve for a produc!% and !he$ all mus! "e included% !o some degree% in es!ima!ing !he demand curve# Define !he follo ing fac!ors and discuss ho !he$ can affec! !he demand curve for a produc!5 ,nferior versus normal goods Su"s!i!u!ion and income effec!s Derived demand Changes in demand and changes in (uan!i!$ demanded Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers# Discussion 'uestion !( <i!h regard !o profi! ma6imi-a!ion% managers are concerned a"ou! !he responsiveness of !he (uan!i!$ demanded for varia"les such as !he price of a produc!% prices of rela!ed produc!s% and consumer incomes# Descri"e !he !$pes of measures and informa!ion a manager re(uires !o measure !he effec!s of !hese varia"les on cos!s and revenues# /o do !hese measures assis! in profi!7ma6imi-ing decisions= Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers# Assignment #!
Midweek Assignment

9our ins!ruc!or ill assign $ou one of !he !opics for $our assignmen!# +os! $our documen! !o !he appropria!e W!( Assignment ! Drop o) "$ Week !, Day *# Golden S!ar <iner$ Case Golden S!ar <iner$ produces midlevel ines consumed primaril$ in :or!h America# Given "elo is !he proBec!ed income s!a!emen! for !he compan$ for 10@@#

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Course Design Guide MBA/5004

Pro,ected -ncome .tatement /!#110 Sales 0@00%000 cases a! FG per case3 Cos! of goods sold5 Ma!erials F@20%000 4a"or F115%000 8i6ed manufac!uring e6penses F45%000 Adminis!ra!ive and selling e6penses5 Deliver$ Commissions Adver!ising Travel 8i6ed adminis!ra!ive and selling e6penses To!al e6penses :e! income "efore !a6es

FG00%000

F;0%000 F50%000 F@0%000 F5%000 F@5%000 F5C0%000 11*#,###

Crea!e a repor! ans ering !he follo ing (ues!ions5

Comple!e !he follo ing !a"le in a full$ func!ional Microsof! E6cel spreadshee!#

Tota2 Tota2 Tota2 'uanti Tota2 Reven 3aria 2 %i)ed Pro5it ty 4ost ue e 4ost 4ost F2#00 C5%000 FG#G5 G5%000 FG#50 20%000 FG#15 H0%000 @00%00 FG#00 0 @@5%00 FC#G5 0 @10%00 FC#50 0 Price

)sing E6cel% prepare a graph sho ing !he "rea&even poin! and an$ profi! or loss a! !he curren! price of FG# E6plain !o !he Golden S!ar managemen! !he implica!ions of !his anal$sis#

Course Design Guide MBA/5004

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<ha! is !he elas!ici!$ coefficien! for each price "e! een FC#50 and FG#50= ,s !he demand elas!ic or inelas!ic a! !hese poin!s= /o can !his informa!ion "e useful !o managemen! in i!s pricing and ou!pu! decisions= *n !he "asis of $our calcula!ions and !he informa!ion a"ove% ha! recommenda!ions ould $ou ma&e !o Golden S!ar in !erms of price and ou!pu! levels=

Crea!e $our repor! in a 17 !o ;7page <ord documen!# :ame $our E6cel shee! S)AMBA5004A<1AA1A4as!:ameA8irs!,ni!ial#6ls# :ame $our repor! S)AMBA5004A<1AA1A4as!:ameA8irs!,ni!ial#doc# Su"mi! $our E6cel shee! and repor! !o !he W!( Assignment ! Drop o) "$ Week !, Day *#
Assignment #$
Final Project

,n Week !% $ou ill e6amine !he na!ure and cos! s!ruc!ure of !he compan$ $ou selec!ed# Anal$-e !he pas!% curren!% and fu!ure cos! considera!ions of !he compan$ and% on !he "asis of $our cos!s anal$sis% crea!e a lis! of s!ra!egies !o enhance !he compan$'s profi!# ,n $our anal$sis% include !he follo ing informa!ion a"ou! !he various cos!s !ha! affec! !he compan$5

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8i6ed cos!s% such as land% ren!% u!ili!$ "ills% proper!$ !a6es% mor!gage pa$men!s% fire insurance% and lease on deliver$ !ruc&s Earia"le cos!s% such as ages of produc!ion or&ers or salespeople% ra ma!erials% elec!ric po er% and inven!or$ 4ife c$cle cos!s% such as ac(uisi!ion% ins!alla!ion% opera!ion% main!enance% refur"ishmen!% and disposal fees *pera!ing cos!s% such as failures% repairs% spares% do n!ime% and loss of produc!ion ill "e !he ne6! s!ep in "uilding $our 8inal

This repor!

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Term +roBec! due in Week 6# Crea!e $our repor! in a 17 !o ;7page Microsof! <ord documen!# A!!ach an$ suppor!ing documen!s% such as spreadshee!s% as an appendi6# :ame $our repor! S)AMBA5004A<1AA;A4as!:ameA8irs!,ni!ial#doc# Su"mi! $our repor! !o !he W!( Assignment $ Drop o) "$ Wednesday, Decem er 11, !#1$# Ci!e an$ sources using !he A+A forma! on a separa!e page#

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Week

hree: Market Structures

Details Point s

Overview

,n Week !% $ou e6amined !he demand and suppl$ func!ions and anal$-ed ho !hese func!ions are influenced "$ various fac!ors# 9ou e6plored !he concep! of elas!ici!$ and discussed ho i! affec!s pricing decisions# 9ou also e6amined !he decision7ma&ing processes !ha! companies mus! engage in !o achieve mar&e! "alance in !he shor! and !he long !erm "$ using !ools such as Cos!7 Eolume7+rofi! 0CE+3 anal$sis# ,n Week $% $ou ill discuss differen! mar&e! s!ruc!ures and !heir charac!eris!ics# 9ou ill e6amine !he cri!eria for profi! ma6imi-a!ion or loss minimi-a!ion# 9ou ill also discuss mar&e! failure# ,n addi!ion% $ou ill loo& a! governmen! in!erven!ion in mar&e!s and i!s effec!s on !he decision7ma&ing process of managemen!#
Readings Week $ online lec!ures 8rom $our course !e6!"oo&% Fundamentals of managerial economics% read !he follo ing chap!ers5 +ricing prac!ices Compe!i!ive mar&e!s Participation Assignment #1
Discussion Questions

+erformance and s!ra!eg$ in compe!i!ive mar&e!s

Participate in class discussion#

The ins!ruc!or ill assign $ou ! o (ues!ions from !he discussion (ues!ions lis!ed "elo # Chec& !he appropria!e Discussion Area !o see hich (ues!ions have "een assigned# B$ %riday, Decem er 1$, !#1$% respond !o !he assigned discussion (ues!ions and su"mi! $our responses !o !he appropria!e !opic in !his Discussion Area# .espond !o assigned (ues!ions using !he lessons and voca"ular$ found in !he reading# Suppor! $our ans ers i!h e6amples and research and ci!e $our research using

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Course Design Guide MBA/5004

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!he A+A forma!# S!ar! revie ing and responding !o !he pos!ings of $our classma!es as earl$ in !he ee& as possi"le# .espond !o a! leas! ! o of $our classma!es# +ar!icipa!e in !he discussion "$ as&ing a (ues!ion% providing a s!a!emen! of clarifica!ion% providing a poin! of vie i!h a ra!ionale% challenging an aspec! of !he discussion% or indica!ing a rela!ionship "e! een one or more lines of reasoning in !he discussion#
Discussion 'uestion 1( To achieve compan$ goals% managers mus! ma&e decisions regarding pricing and ou!pu!# These decisions ill "e influenced "$ !he na!ure of !he compan$Ds mar&e! environmen! or s!ruc!ure# ,n case of compe!i!ive firms% ho does !he mar&e! s!ruc!ure affec! !he pricing and ou!pu! decisions of individual firms= <ha! are !he "asic charac!eris!ics of a compe!i!ive firm=

Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers#
Discussion 'uestion !( ,n general% compe!i!ive mar&e!s alloca!e resources !o !he highes! and "es! use# Then h$ does mar&e! failureIa si!ua!ion in hich !oo man$ or !oo fe resources are alloca!ed !o !he produc!ion or consump!ion of a good or serviceIoccur= Adam Smi!h% idel$ &no n as !he fa!her of modern economics% e6pounded !he !heor$ of !he free mar&e! and opposed an$ form of economic concen!ra!ion# /e "elieved !ha! es!a"lishing a price !ha! provides a fair re!urn on land% la"or% and capi!al dis!or!s !he mar&e!Ds na!ural a"ili!$# <as he correc! or incorrec! in his !heories concerning !he efficienc$ of !he mar&e!place= E6plain# Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers# Assignment #!
Midweek Assignment

9our ins!ruc!or ill assign $ou one of !he !opics for $our assignmen!# +os! $our documen! !o !he appropria!e W$( Assignment ! Drop o) "$ Week $, Day *#

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opics
Crossroads Sign Case Bravo +or& .inds Case

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Assignment #$
Final Project

This ee&% $ou ill appl$ !he specific &no ledge of mar&e! s!ruc!ures $ou have gained in class !o !he compan$ $ou selec!ed# Crea!e an anal$sis repor! addressing !he follo ing poin!s5

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Descri"e !he mar&e! s!ruc!ure in hich !he compan$ compe!es i!h regard !o i!s produc!s# ,n $our repor!% ans er !he follo ing (ues!ions5 <ho is a maBor compe!i!or of !he compan$= Do !he compan$ and !he compe!i!or share !he same !arge! mar&e!= o <ha! differen!ia!es !he compan$Ds produc!s from i!s compe!i!orDs in !erms of u!ili!$= o <ha! differen!ia!es !he compan$Ds produc!s from i!s compe!i!orDs in !erms of pac&aging% si-e% and availa"ili!$= o Are !he compan$Ds produc!s availa"le in !he same geographic loca!ion% "o!h domes!ic and in!erna!ional% as !hose of i!s compe!i!or= o <ho has more glo"al reach% !he compan$ or i!s compe!i!or= ,n $our repor!% ans er !he follo ing (ues!ions i!h regard !o !he compan$Ds pricing s!ra!eg$ for i!s produc!s5 o ,n reference !o i!s compe!i!ors% is !he compan$ !he price leader= ,f no!% ho is= o ,s !he pricing of !he compan$ a! !he s&imming 0high3 or pene!ra!ion 0lo 3 level= +rovide a ra!ionale for $our ans er# ,nclude a! leas! !hree compe!i!ors' prices# ,n $our repor!% ans er !he follo ing (ues!ions i!h regard !o !he measures !he compan$ has !a&en in an effor! !o sus!ain or enhance i!s compe!i!ive posi!ion in !he given mar&e! s!ruc!ure5 o Does !he compan$ have a s!rong mar&e!ing "udge! !o crea!e a areness for i!s produc!s= o <ha! !$pes of media adver!ising has !he compan$ used= o <hich ! o coun!ries has !he compan$ en!ered= /as i! "een received favora"l$= o Does !he compan$ offer value7added "enefi!s%
o o

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such as an e6!ended arran!$% re"a!es% "u$7 one7ge!7one promo!ions% seasonal or (uan!i!$ discoun!s% free samples% e!c#% i!h i!s produc!s !ha! i!s compe!i!or does no!= Crea!e $our repor! in a 17 !o ;7page Microsof! <ord documen!# :ame $our repor! S)AMBA5004A<;AA;A4as!:ameA8irs!,ni!ial#doc# Su"mi! $our repor! !o !he W$( Assignment $ Drop o) "$ Wednesday, Decem er 1", !#1$# Ci!e an$ sources using !he A+A forma! on a separa!e page#

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Week "our: #oncompetitive Markets

Details
Overview

Point s

4as! ee&% $ou e6amined differen! mar&e! s!ruc!ures and !heir charac!eris!ics and !he cri!eria for profi! ma6imi-a!ion and loss minimi-a!ion# 9ou also discussed mar&e! failure# 9ou concluded !he lec!ures i!h a discussion of governmen! in!erven!ion in mar&e!s and i!s effec! on !he decision7ma&ing process# ,n Week *% $ou ill focus on !he noncompe!i!ive mar&e!s of a monopol$# 9ou ill e6amine !he level of governmen! involvemen! in !hese mar&e!s in !erms of an!i!rus! legisla!ion# ,n addi!ion% $ou ill e6plore !he mar&e! s!ruc!ures of an oligopol$# 4e!Ds "egin !his ee&Ds lec!ures i!h a discussion of monopol$ and monopolis!ic compe!i!ion#
Readings Week * online lec!ures 8rom $our course !e6!"oo&% Fundamentals of managerial economics% read !he follo ing chap!ers5 Monopol$ and monopson$ Participation Assignment #1
Discussion Questions

Monopolis!ic compe!i!ion and oligopol$

Participate in class discussion#

The ins!ruc!or ill assign $ou ! o (ues!ions from !he discussion (ues!ions lis!ed "elo # Chec& !he appropria!e Discussion Area !o see hich (ues!ions have "een assigned# B$ %riday, Decem er !#, !#1$% respond !o !he assigned discussion (ues!ions and su"mi! $our responses !o !he appropria!e !opic in !his Discussion Area# .espond !o assigned (ues!ions using !he lessons and voca"ular$ found in !he reading# Suppor! $our ans ers i!h e6amples and research and ci!e $our research using !he A+A forma!#

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S!ar! revie ing and responding !o !he pos!ings of $our classma!es as earl$ in !he ee& as possi"le# .espond !o a! leas! ! o of $our classma!es# +ar!icipa!e in !he discussion "$ as&ing a (ues!ion% providing a s!a!emen! of clarifica!ion% providing a poin! of vie i!h a ra!ionale% challenging an aspec! of !he discussion% or indica!ing a rela!ionship "e! een one or more lines of reasoning in !he discussion#
Discussion 'uestion 1( <hich mar&e! s!ruc!ureIperfec! compe!i!ion or monopol$I ill resul! in a more efficien! use of an econom$Ds resources= <h$= <ha! condi!ions mus! e6is! !o facili!a!e !he efficien! use of !he econom$Ds resources= /o realis!ic are !hese condi!ions= Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers# Discussion 'uestion !( Assume $ou are hired as a consul!an! "$ Bar&s ,ndus!ries% a compan$ in a monopolis!icall$ compe!i!ive indus!r$# /o ould $ou advise !he compan$ in !erms of pricing% ou!pu!% resource usage% and adver!ising= <ould !he compan$ encoun!er an$ pro"lems in decision ma&ing= Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers# Assignment #!
Midweek Assignment

9our ins!ruc!or ill assign $ou one of !he !opics for $our assignmen!# +os! $our documen! !o !he appropria!e W*( Assignment ! Drop o) "$ Week *, Day *# Calcula!ing !he ,ndus!r$ *u!pu! and Mar&e! Share Assume $ou are !he manager of A""a Ca"le Compan$% hich provides commercial communica!ion services !o !he !o n of Can$on 4a&e% Te6as# Because of licensing res!ric!ions in !he mar&e!% onl$ $our compan$ and ! o o!hers 0Ba""a and Ca""a3 are allo ed !o opera!e in !his mar&e!# The !hree companies decide !o form a car!el and divide !he mar&e! shares such !ha! each compan$ ill provide services !ha! ill ma6imi-e i!s profi!s# The licensing res!ric!ions allo each compan$ !o sell as much as i! an!s a! a price ceiling of F1%100# 9ou have !he follo ing ou!pu! and MC da!a for each compan$5

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Output ' @%000 1%000 ;%000 4%000 5%000 C%000

A a 1%500 1%400 1%100 1%000 1%@00 1%100

74 /10 8a a 1%C00 1%;00 1%@00 1%000 1%100 1%500

4a a 1%G00 1%500 1%;00 1%@00 1%100 1%;00

a# Calcula!e !he indus!r$ ou!pu! and mar&e! share a! !he curren! price of F1%100% assuming !he prices are s!a"le and unli&el$ !o change# "# Assume !he curren! prices in !he mar&e! are challenged "$ !he regula!or$ agenc$% resul!ing in a ne ma6imum price of F1%000# /o ill !his change !he indus!r$ ou!pu! and mar&e! share for each compan$= c# ,s !here an$ incen!ive for an$ compan$ !o chea! under ei!her of !he condi!ions in !as&s a and "= <h$ or h$ no!= Crea!e $our repor! in a 17 !o ;7page Microsof! <ord documen!# :ame $our repor! S)AMBA5004A<4AA1A4as!:ameA8irs!,ni!ial#doc# Su"mi! $our repor! !o !he W*( Assignment ! Drop o) "$ Week *, Day *# Ci!e an$ sources using !he A+A forma! on a separa!e page#
Assignment #$
Final Project

This ee&% $ou ill appl$ specific &no ledge of !he considera!ions for managerial decision ma&ing in in!erna!ional !rade and !he compara!ive advan!age for !he selec!ed compan$ over i!s compe!i!ors# Crea!e an anal$sis repor! including !he follo ing informa!ion5

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The advan!ages and disadvan!ages of !he compan$Ds involvemen! in in!erna!ional !rade Trade7off considera!ions !he compan$ faces in !he in!erna!ional mar&e!place Descri"e !he me!hods !he compan$ uses !o iden!if$ oppor!uni!ies% !hrea!s% via"le al!erna!ives% and conse(uences# Specific compara!ive advan!ages !he compan$ possesses in !he selec!ed produc! S!ra!egies !o enhance !he compan$Ds compe!i!ive posi!ion in !he differen! domes!ic and in!erna!ional mar&e!s and mar&e! s!ruc!ures

Crea!e $our repor! in a 17 !o ;7page Microsof! <ord documen!# :ame $our repor! S)AMBA5004A<4AA;A4as!:ameA8irs!,ni!ial#doc# Su"mi! $our repor! !o !he W*( Assignment $ Drop o) "$ Wednesday, 9anuary 1, !#1*# Ci!e an$ sources using !he A+A forma! on a separa!e page#

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Week "ive: $ong% erm Investment Decisions

Details
Overview

Point s

4as! ee&% $ou focused on !he noncompe!i!ive mar&e!s of a monopol$# 9ou e6amined !he level of governmen! involvemen! in !hese mar&e!s in !erms of an!i!rus! legisla!ion# 9ou also e6plored !he mar&e! s!ruc!ures of an oligopol$# ,n Week 6% $ou ill focus on !he process "$ hich a compan$ ma&es long7!erm inves!men! decisions# The concep! of ris& ill "e in!roduced in !erms of !he differen! !$pes of ris&s faced "$ a firm and !he various me!hods !ha! can "e used !o measure ris& and incorpora!e !hose fac!ors in!o !he decision7ma&ing process rela!ed !o long7 !erm inves!men!s# The capi!al7"udge!ing process ill also "e e6amined% including cash flo es!ima!ion and evalua!ion# :e6!% $ou ill discuss and evalua!e !he decision rules of !he !hree mos! of!en used me!hodsIne! presen! value 0:+E3% in!ernal ra!e of re!urn 0,..3% and pa$"ac&Ifor cash flo evalua!ion# 8inall$% $ou ill e6amine !he financing decisions made "$ firms using !he concep! of !he cos!7of7capi!al approach in !erms of !he influence on !he adop!ion of an op!imal capi!al "udge!#
Readings Week 6 online lec!ures 8rom $our course !e6!"oo&% Fundamentals of managerial economics% read !he follo ing chap!ers5 .is& anal$sis Participation Assignment #1
Discussion Questions

Capi!al "udge!ing

Participate in class discussion#

The ins!ruc!or ill assign $ou ! o (ues!ions from !he discussion (ues!ions lis!ed "elo # Chec& !he appropria!e Discussion Area !o see hich (ues!ions have "een assigned# B$ %riday, 9anuary $, !#1*% respond !o !he assigned discussion (ues!ions and su"mi! $our responses !o !he appropria!e !opic in !his Discussion Area#

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.espond !o assigned (ues!ions using !he lessons and voca"ular$ found in !he reading# Suppor! $our ans ers i!h e6amples and research and ci!e $our research using !he A+A forma!# S!ar! revie ing and responding !o !he pos!ings of $our classma!es as earl$ in !he ee& as possi"le# .espond !o a! leas! ! o of $our classma!es# +ar!icipa!e in !he discussion "$ as&ing a (ues!ion% providing a s!a!emen! of clarifica!ion% providing a poin! of vie i!h a ra!ionale% challenging an aspec! of !he discussion% or indica!ing a rela!ionship "e! een one or more lines of reasoning in !he discussion#
Discussion 'uestion 1( Man$ companies produce more !han one produc!# <ha! is !he mo!iva!ion !o do !his= /o do !he rules for profi! ma6imi-a!ion differ "e! een a single7produc! compan$ and a mul!iproduc! compan$= <ould a compan$ ma&e secondar$ produc!s even !hough i! loses mone$ or has -ero profi!s on !hose produc!s= <h$= Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers# Discussion 'uestion !( <ha! are !he differen! !$pes of ris&s a compan$ faces hen ma&ing inves!men! decisions= <hich !$pes of ris&s are con!rolla"le= <hich !$pes are uncon!rolla"le= E6plain i!h an appropria!e ra!ionale# /o can a compan$ incorpora!e ris& in!o !he decision7ma&ing process= Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers# Assignment #!
Midweek Assignment

9our ins!ruc!or ill assign $ou one of !he !opics for $our assignmen!# +os! $our documen! !o !he appropria!e W6( Assignment ! Drop o) "$ Week 6, Day *#

40

,ncorpora!ion of .is& in!o !he Decision7Ma&ing +rocess 9our compan$ has as&ed $ou !o anal$-e ! o mu!uall$ e6clusive proBec!s for !he coming $ear# +roBec! A ill have an ini!ial ou!la$ of FG%100# +roBec! B ill cos! FC%200# Bo!h proBec!s ill las! for !hree $ears# *n !he "asis of !he informa!ion regarding !he ris& involved in !he ! o proBec!s% $ou came up i!h !he follo ing

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pro"a"ili!$ dis!ri"u!ions for !he proBec!s5 Pro,ect A Pro,ect 8 i2it Net 4ash %2ows Pro a i2it Net 4ash %2ows /10 y /10 2%@00 0#; 500 H%@00 0#5 2%@00 @0%500 0#1 @C%500

Pro a y 0#; 0#5 0#1

To evalua!e !he ! o proBec!s% $ou decide !o use !he compan$Ds eigh!ed average cos! of capi!al 0<ACC3 for !he less ris&$ proBec! 0@@ percen!3 and !he <ACC plus ! o poin!s 0@; percen!3 for !he more ris&$ proBec!#

<ha! is !he e6pec!ed value for each proBec!= <ha! does !his value represen!= <ha! is !he coefficien! of varia!ion for each proBec!= <ha! informa!ion does !his measure provide !o $ou and !o !he compan$= <hich proBec! has !he mos! ris&= <h$= <ha! is !he ris&7adBus!ed :+E for each proBec!= <ha! do !hese measures !ell $ou and !he compan$= <hich proBec! ould $ou recommend !o managemen!% and ho ould $ou Bus!if$ $our selec!ion= ,f !hese ! o proBec!s ere no! mu!uall$ e6clusive% ould $ou selec! "o!h= <h$ or h$ no!=

Crea!e $our repor! in a 17 !o ;7page Microsof! <ord documen!# :ame $our repor! S)AMBA5004A<5AA1A4as!:ameA8irs!,ni!ial#doc# Su"mi! $our repor! !o !he W6( Assignment ! Drop o) "$ Week 6, Day *# Ci!e an$ sources using !he A+A forma! on a separa!e page#

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Assignment #$
Final Project

8inal +roBec!5 .is&% *p!imal +lan! Si-e% and Governmen! ,nvolvemen! in a Compan$Ds *pera!ions This ee&% $ou ill focus on !he fundamen!als of long7 !erm decision ma&ing "$ !he selec!ed compan$# Crea!e an anal$sis repor! e6amining and discussing !he compan$Ds long7!erm s!ra!egies and decision7ma&ing process# ,n $our anal$sis repor!5

C0

,den!if$ !he compan$Ds long7!erm o"Bec!ives and goals# Evalua!e !he direc!ion !he compan$ is going in% in !erms of i!s produc!s and mar&e! s!ra!egies# ,den!ifica!ion of ris& measuremen!s and s!ra!egies of ris& minimi-a!ion !o an!icipa!e uncer!ain!$# Descri"e !he compan$'s long7!erm o"Bec!ives on profi!a"ili!$% compe!i!ive ac!ivi!ies% and !echnological and mar&e! leadership% as ell as i!s social and environmen!al responsi"ili!ies# ,den!if$ !he process "$ hich !he compan$ iden!ifies and raises funds for capi!al inves!men!s# Descri"e !he cos! s!ruc!ures of !hese funds from "o!h in!ernal and e6!ernal sources#

Crea!e $our repor! in a 17 !o ;7page Microsof! <ord documen!## :ame $our repor! S)AMBA5004A<5AA;A4as!:ameA8irs!,ni!ial#doc# Su"mi! $our repor! !o !he W6( Assignment $ Drop o) "$ Wednesday, 9anuary ", !#1*# Ci!e an$ sources using !he A+A forma! on a separa!e page#

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Week Si&: E''ects o' Market "ailure

Details
Overview

Point s

4as! ee&% $ou focused on !he capi!al7"udge!ing process% especiall$ cash flo es!ima!ion and evalua!ion% "$ hich a compan$ ma&es long7!erm inves!men! decisions# 9ou ere also in!roduced !o !he concep! of ris&# ,n addi!ion% $ou e6amined !he financing decisions companies ma&e using !he cos!7of7capi!al approach in !erms of !he influence of such decisions on !he adop!ion of an op!imal capi!al "udge!# ,n Week +% $ou ill e6plore !he effec!s of mar&e! failure on !he econom$ and !he me!hods "$ hich !he governmen! deals i!h !hese mar&e! e6!ernali!ies# 9ou ill also e6amine !he concep!s of priva!e and pu"lic goods and !he reasons resources mus! "e alloca!ed !o !he ! o !$pes of goods# 4e!Ds "egin !his ee&Ds lec!ures goods and e6!ernali!ies#
Readings

i!h a discussion on pu"lic

Week + online lec!ures 8rom $our course !e6!"oo&% Fundamentals of managerial economics% read !he follo ing chap!er5 Governmen! in !he mar&e! econom$ 40

Assignment #1
Discussion Questions

The ins!ruc!or ill assign $ou ! o (ues!ions from !he discussion (ues!ions lis!ed "elo # Chec& !he appropria!e Discussion Area !o see hich (ues!ions have "een assigned# B$ %riday, 9anuary 1#, !#1*% respond !o !he assigned discussion (ues!ions and su"mi! $our responses !o !he appropria!e !opic in !his Discussion Area# .espond !o assigned (ues!ions using !he lessons and voca"ular$ found in !he reading# Suppor! $our ans ers i!h e6amples and research and ci!e $our research using !he A+A forma!# S!ar! revie ing and responding !o !he pos!ings of $our

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classma!es as earl$ in !he ee& as possi"le# .espond !o a! leas! ! o of $our classma!es# +ar!icipa!e in !he discussion "$ as&ing a (ues!ion% providing a s!a!emen! of clarifica!ion% providing a poin! of vie i!h a ra!ionale% challenging an aspec! of !he discussion% or indica!ing a rela!ionship "e! een one or more lines of reasoning in !he discussion#
Discussion 'uestion 1( Mar$ lives ne6! door !o Mi&e# Since she or&s !he nigh! shif!% she sugges!s !o Mi&e !he idea of cons!ruc!ing a ligh! pos! "e! een !heir ! o houses# /e agrees and !ells her !o ge! !he ligh! pos! cons!ruc!ed and !o send him !he "ill for his share# 4a!er% ho ever% he refuses !o pa$ his share of !he cos!# Mi&e no has !he "enefi!s of !he ligh! a! no cos!% and Mar$ can do no!hing a"ou! i!# This si!ua!ion can also occur in !he mar&e!place% here no one can "e e6cluded from using a pu"lic good such as elec!rici!$ and a!er# <ha! ac!ions can "e or are "eing !a&en !o deal i!h such si!ua!ions= Give e6amples# <ha! are pu"lic goods= <h$ mus! !he governmen! provide !hem or force !he priva!e sec!or !o provide !hem= <ha! is !he free-rider pro"lem= Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers# Discussion 'uestion !( <ha! is +are!o op!imali!$= /o can !his concep! "e applied !o governmen! programs and !heir implemen!a!ion= Can marginal anal$sis "e applied !o !he evalua!ion of governmen! programs= Suppor! $our ans ers i!h e6amples and reasoning# Commen! on !he pos!ings of a! leas! ! o peers# Assignment #!
Final Project

This ee&% $our final proBec! is due for su"mission# 9our final proBec! should adhere !o !he follo ing guidelines5

C0

Ensure !he final assignmen!s in !he ee&l$ !as&s of Weeks 1:6 form !he "asic ou!line and con!en! for $our final repor!# Change or add !o !his forma!% if re(uired# +u! !oge!her a final paper !ha! cons!i!u!es one comprehensive repor!% no! a series of ee&l$

Course Design Guide MBA/5004

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repor!s% copied !oge!her in!o one paper# ,nclude !he follo ing informa!ion in $our final !erm paper5

An e6ecu!ive summar$ of $our final repor! The maBor fac!ors responsi"le for !he success of !he selec!ed compan$ The fac!ors !ha! ma$ need improvemen! An$ recommenda!ions $ou ma$ have !o offer !he compan$

Crea!e $our final !erm paper in a @17 !o @57page Microsof! <ord documen!# A!!ach an$ suppor!ing documen!s% such as spreadshee!s% as an appendi6# :ame $our final !erm paper S)AMBA5004A<CAA1A4as!:ameA8irs!,ni!ial#doc# Su"mi! $our final !erm paper !o !he W+( Assignment ! Drop o) "$ .aturday, 9anuary 11, !#1*# Ci!e an$ sources using !he A+A forma! on a separa!e page#

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Week 2 Midweek Assignment The Sales and Advertising Data (2009) Table 1 Advertising ($) 10,000 9,000 11,000 12,000 11,000 12,000 13,000 13,000 14,000 15,000 15,800 16,700 Sales ($) 43,000 40,500 41,000 45,900 47,000 51,000 54,000 57,000 56,000 60,000 61,000 63,000 ons!"er #n$o"e ($) 41,000 43,000 45,000 47,000 49,000 51,000 53,000 55,000 57,000 58,000 59,000 61,000

Month January February Marc !"ri# May June Ju#y !ugus$ %e"$e&ber 'c$ober (o)e&ber Dece&ber

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Week 3 Midweek Assignment

Topic: Crossroads Sign Case Assume you are the plant manager for Crossroads Sign Company, which produces road signs in a market that approximates perfect competition. Due to a slow economy, business has been slow and the company is losing money every month. The owners have asked you whether to continue operations or to shut down at least until the economy improves. ou have the following information available! "arginal #evenue $"#% & '()* Total Cost $TC% & '(,(** + (),- + *..-/ "arginal Cost $"C% & (), + (./As the plant manager, should you recommend to the owners that the plant be shut down for a while0 1ustify your answer using at least two analytical techni2ues and presenting the information graphically. Create your report in a /3 to )3page "icrosoft 4ord document. 5ame your report S67"8A,**974)7A/7:ast5ame7;irst<nitial.doc. Submit your report to the W3: Assignment 2 Dropbox by Week 3, Day 4. Cite any sources using the A=A format on a separate page.
Assign"ent 2 %rading riteria Ma&i"!" 'oints

Analy>ed and ?ustified whether, as the plant manager, you should recommend to the owners that the plant be shut down for a while. 6sed at least two analytical techni2ues to ?ustify your response and presented the information graphically. =resented a structured document free of spelling and grammatical errors. =roperly cited sources using the A=A format.
Total(

(, (, , ,

Topic 2: Bravo Pork Rinds Case Assume you are the plant manager for 8ravo =ork #inds, which produces pork products in a market that approximates perfect competition. Due to a slow economy, business has been slow and you are losing money every month. The owners have asked you whether to continue operations or to shut down at least until the economy improves. ou have the following information available!

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"arginal #evenue $"#% & '(*, Total Cost $TC% & '(,/** + (),- @ *..-/ "arginal Cost $"C% & (), @ As the plant manager, should you recommend to the owners that the plant be shut down for a while0 1ustify your answer using at least two techni2ues and presenting the information graphically. 5ame your report S67"8A,**974)7A/7:ast5ame7;irst<nitial.doc. Submit your report to the W3: Assignment 2 Dropbox by Week 3, Day 4. Cite any sources using the A=A format on a separate page.
Assign"ent 2 %rading riteria !na#y*ed and +us$i,ied - e$ er, as $ e "#an$ &anager, you s ou#d reco&&end $o $ e o-ners $ a$ $ e "#an$ be s u$ do-n ,or a - i#e. /sed a$ #eas$ $-o ana#y$ica# $ec ni0ues $o +us$i,y your res"onse and "resen$ed $ e in,or&a$ion gra" ica##y. 1resen$ed a s$ruc$ured docu&en$ ,ree o, s"e##ing and gra&&a$ica# errors. 1ro"er#y ci$ed sources using $ e !1! ,or&a$. Total( Ma&i"!" 'oints 15 15 5 5 40