Coverage: Whatever we covered in class after Midterm Exam,not cumulativeSample Exam Questions1. Linear Function y = a + bxP2 E1 (E2) + E2REVIEW SHEETM300Final Exam Fall 2014Video camera monitoring for examsVideo cameras may be used to monitor the room during student assessment activities, including but not limited to, exams, tests, and quizzes. Video recordings may be used to investigate or support disciplinary action. All access to and use of video equipment and recordings will follow applicable IU policies.Coverage: Whatever we covered in class after Midterm Exam, not cumulative 1. Course Notes after midterm exam.2. Homework including those not turned in after midterm – i.e., sales forecast homework (Kenmore Appliance), computing price elasticity, and IMC budget allocation problem (the case of Dell Computer), etc.3. Cases discussed after midterm: Gardenburger Advertising Strategy Case, Burroughs Wellcome Case.The following topics represent most potential areas for questions (not all inclusive).1. IMC: five major IMC tools, be able to tell the differences among them, be able to tell the advantages and disadvantages, be able to judge when they should be used, etc.12. International marketing: product/promotion adaptation grid, international marketing entry strategies-Exporting: sell to interested parties in another country. Products are handled by middlemen.-Licensing: for a fee a foreign company buys the right to use the company’s manufacturing process, trademark, trade secret, etc.-Contract manufacturing: the international company contracts with a manufacturer in the host country to manufacture the product in the host country using the host’s standards. Unlike licensing the international firm has little control over manufacturing process. The host company owns the manufacturing facilities.-Joint ownership: one company joining with another to create a product or service.-Direct investment: foreign production and marketing. The foreign company ownsthe production capabilities.-Direct Marketing: manufacturing or assembling in one country and marketing in another. 3. Consumer buyer readiness stages and its relationship with IMC design.-Advertising and PR most effective during the awareness and knowledge stages ofbuyer readiness-Personal Selling most effective during liking, preference, conviction stage of buyer readiness-Sales Promotion most effective during purchase and repurchase stage of buyer readiness4. IMC budget allocation problem (the case of Dell Computer): be able to judge what will happen if some of the conditions change without actually running Solver.5. Research results on advertisement and sales promotion shown in the notes26. Comparison of different types of advertisement: TV, Radio, Newspapers, Direct mail, Magazines, Outdoor ad. Be able to judge when they should be used.7. Three main types of distribution strategies: intensive, selective, and exclusive. Be able to judge when they should be used.-Intensive Distribution: the objective is to saturate the market with product* uses an undifferentiated marketing strategy or mass marketing to reach customers* image of being sold everywhere is consistent with the nature of the product * often used by convenience goods and commodity manufacturers-Selective Distribution: a limited number of retailers or dealers are used to reach target market.* strategy should be consistent with the image of the product as a good that can be bought in only certain stores* shopping goods commonly employ this strategyExclusive Distribution – only one or a limited number of retailers market the product in aparticular geographical area* strategy should be consistent with the high quality image of the product* many specialty goods employ this strategy38. Different types of channel conflictsHorizontal Conflicts occur among firms at the same level of the channel, e.g., Two car dealers.Vertical Conflicts occur between different levels of the same channel, e.g., Ford and Firestone9. Different types of Channel organization: vertical marketing system, horizontal marketing system, hybrid marketing system-Vertical Marketing Systems (VMS) – channel members act as a unified marketingsystemCorporate – channel leadership through ownershipContractual – independent firms joining together to obtain economies or sales impact (e.g., Franchise organizations)Administered – channel leadership through power of one memberNote: Degree of direct control varies-Horizontal Marketing Systems Horizontal cooperation (e.g., banks in grocery stores)-Hybrid Marketing Systems (e.g., retailers, sales force, and online)10.Sales forecast (like the taking-home homework - Kenmore Appliance): be able to use all kinds of forecasting models, draw conclusions, etc.Two popular techniques for forecasting sales are moving average models (MAM) and Exponential Smoothing Models (ESM). Both models rely on historical data to forecast sales, so they are extrapolative techniques. MAM utilize the following formula Sales t+1 = 1/n (Sales t+ Sales t-1 + Sales t -2+ ...Sales t-n-1)where Sales t+1 = forecasted sales for an upcoming period Sales t = sales in timet (present period) Sales t-1 = sales in time t-1 (last period) n = span which captures the average of the last n observations before the forecast period11. Business cases discussed after midterm: Gardenburger Advertising Strategy Case, Burroughs Wellcome Case.412. Push vs. pull strategies.--> -->Push Demand DemandCommunication Strat. Communication Strat  13. Loss leader: what is it? how to use?-A product sold at a loss to attract customers14. Price elasticity: be able to calculate and interpret.Elasticity = % change of demand / %change of price15. Cost-plus pricing: be able to do all the calculations, and draw conclusions.Profit = Revenue – ExpensesRevenue = Units sold X unit priceCustomer Value = Product’s Benefits/ PricePrice = Markup + Cost16. Pricing strategies for products: skimming vs. penetration strategy. When and how to use it?-Price skimming is a pricing strategy in which a marketer sets a relatively high price for a product or service at first, then lowers the price over time.-Penetration pricing is the practice of offering a low price for a new product or service during its initial offering in order to attract customers away from competitors.-SEE MORE BELOW517. Relationship between price elasticity,