Exam #2

Take Home Exam #2 (THE#2) Name: _____________

Answer both of the Take Home Exam questions below. It is the second of 2 THE’s. For course grading purposes the higher grade will be weighted 60% and the lower grade 40%.

Your response is to be submitted via BB before Saturday, April 21, at 11:59 PM. You are to submit electronically via Blackboard. The exam is open book, open note and may be attempted on an individual basis or in cooperation with one other fellow student. In the latter circumstance equal contribution is assumed. You may only collaborate with a student with whom you have not previously submitted THE#1. While you may consult written materials, you are not to discuss your answers with anyone other than your collaborator, if there is one. If you quote substantially from a source it should be cited! Submission of your exam attests to your acceptance of these conditions. Please submit your exam in a unified file, i.e. not partial answers in separate files. You may submit a scanned copy but .JPEG is not acceptable. MSWord is also welcomed! Include YOUR NAME ON THE FILE ITSELF. Best of luck!

A. Dermavescent Labs Case

The information below is transcribed from WS#1 of the above case:

Unit contribution margin = 78.9%

Brand contribution margin = 36.6%

a) Briefly discuss each of the above 2 CM’s. Include your assessment of the information each CM provides, and to whom in the company. Suggest a specific decision for which each metric, respectively, provides important input. (6 points)

b) Carefully distinguish between “initial purchase” and “repeat purchase” in evaluating the results of a Test Market. Use the Dermavescent case to illustrate your answer. (4 points)

B. a) In the MARKETPLACE simulation we have used “market share’ extensively as an aid to strategy development.

i) Discuss the issues involved in computing a measure of “market share”. Explicitly identify the method employed in the simulation and provide a critique which addresses both strengths and weaknesses of the calculations provided in the Market Performance Folder. Use the simulation output of Quarter#8 to illustrate your answer. (4 points)

ii) In the simulation we are using “Creation of Wealth” as our criterion of success. Do you believe that this is the optimal criterion? How would you evaluate “Market Share” as a criterion of success? Carefully explain. (3 points)

b) Specifically review the impact of the “ideal point model of consumer response” (see Slide #11 of the Quarter#2 PowerPoints) in the design of effective advertising. (3 points)

The submission (THE#2) is due 4/21 (Saturday) at 11:59 PM. (Use Messages function on BB or submit a hard copy in class). Either type answers in MSWord or scan to a pdf file. Do not use JPEG! Make sure that your name(s) are on the FILE itself.

Note: 0.5 points may be deducted for each hour, or part thereof, that a submission is late, with a maximum of 5 points per 24 hours. This is based on 20 points per question!