1. In April 2008‚ Delta Airlines announced its intention to merge with and absorb Northwest Airlines‚ formerly known as Northwest Orient. Delta Airlines had already grown through the acquisition of Northeast in 1972 and Western Airlines in 1986. Northwest was also a large airline‚ having absorbed Republic Airlines‚ itself a merger of North Central Airlines‚ Southern‚ and later Hughes Air west. Republic had an important hub in Memphis‚ as did Federal Express. The result would be global airlines with
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“Keep Climbing‚ Delta.” Executive Summary: How does the price of crude oil affect an airline’s profits? How can Delta respond to possible loss of profits from fluctuating oil prices? The airline mergers and consolidations over the past decade have shifted competitive focus from increasing market share to obtaining and preserving profitability. One expense over which airlines have little control is the price of oil. The volatility of its price is partially due to geopolitical uncertainty
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Case: Blue Nile Inc. in 2010: Will Its Strategy to Remain Number One in Online Diamond Retailing Work? Assignment Questions: 1. How strong are the competitive forces confronting Blue Nile and other online retail jewelers? Which one of the five competitive forces is the strongest? Do a five-forces analysis to support your answer. 2. What key factors will determine a company’s success in the online jewelry business in the next 3-5 years? 3. What is Blue Nile’s strategy? Which of the five
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Merrill Lynch Connects Past and Future Technology CASE STUDY 1. Why did Merrill Lynch need to update its IT infrastructure? Merrill Lynch and its subsidiaries provide brokerage‚ investment banking‚ financing‚ wealth management‚ advisory‚ asset management‚ insurance‚ lending‚ and other related products and services to private‚ institutional‚ and government clients. One of the most critical components of Merrill Lynch’s operations is its information technology infrastructure. It has played
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Chapter 5 Notes Three general reasons for holding onto cash: 1. managing transaction needs 2. preparing for cash emergencies 3. making a temporary investment -very conservative advice suggest you should have enough liquid assets to cover 5 to 8 months of regular expenses -others suggest 2 months is more than enough Four rules to help better cash management outcomes: 1. keep track of your cash by balancing your checkbook every month 2. develop a system to ensure that
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Delta Song Case Analysis Possible cost drivers that will allow us to estimate a salary cost function for Delta are: available seat miles‚ number of departures‚ available ton miles‚ revenue passenger miles‚ and revenue ton miles. The two cost drivers we chose were revenue passenger miles and available ton miles. The salaries consist of payments to pilots‚ flight attendants and ticket agents. Their salaries are determined by the number of passengers and cargoes and the miles or hours flown. This is
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substances originating from living organisms‚ or artificial materials that are similar enough to plant and animal matter to be put to use by microorganisms ------------------------------------------------- ONE OPTION: BIODEGRADABLE Plastics Biodegradable plastic is plastic that has been treated to be easily broken down by microorganisms and return to nature. Many technologies exist today that allow for such treatment. Currently there are some synthetic polymers that can be broken down by microorganisms
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Solutions – Chapter 5 Chapter 5 Financial Analysis Question 1. Which of the following types of firms do you expect to have particularly high or low asset turnover? Explain why. Supermarket—High asset turnover. Supermarkets tend to be high volume businesses. Many of the food products in supermarkets are perishable‚ and freshness is often used to differentiate products‚ forcing a certain amount of inventories turnover. The typical consumer buys groceries on a regular basis‚ guaranteeing grocery
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CASE 5 Why Did Global Food Prices Rise? Case Summary For the past 25 years‚ food prices have been declining due to increased productivity and output from the farm sector worldwide. In 2007 however‚ this changed. There are two main explanations to this. The first is an increased demand for food in rapidly developing nations such as China and India. Meat in particular has contributed to the rising prices as farmers have to feed their animals an extensive amount of grain in order to keep up with
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Chapter 5 |Activity-Based Cost Systems |[pic] | QUESTIONS 5-1 Traditional volume-based cost allocation systems that use only drivers that vary directly with the volume of products produced—such as direct labor dollars‚ direct labor hours‚ or machine hours—are likely to systematically distort product costs because they break the link between the cause for the costs and the basis for assignment
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