Decision Points-

1. Demand:

The total market demand was estimated based on the market outlook figures- USA
(14%), Asia (14%), Europe (14%). These figures were used to estimate our market share
in each of the regions :

USA

Tech 4 - 12%

Tech 2 - 5.3 %

Asia

Tech 1 - 5.2%

Tech 3 - 5.2%

Europe

Tech 4 - 5%

Tech 2 - 5.1%

2. Production:

Contract manufacturing of Technology 4 is given out to the USA since Tech 4 will be
introduced only in the USA and Europe. Producing it in Asia will increase the tariffs
costs. Also renewable energy utilization is maintained at 100% in both the USA and
Asia.

Technology 2 and 4 are produced in the USA , 1562 units of tech 4 given out for contract
manufacturing. Technology 1 and Technology 3 produced in Asia with tech 3 (2007)
units being given out for contract manufacturing in Asia as tech 3 currently will be
introduced only in Asia, this will help in keeping tariffs low.

3. HR:

Keeping people at 690 to invest in R&D. Increased the wages along with the training
budget to keep the voluntary turnover rate low. Training priorities and labor policies were
chosen based on the information provided in the market outlook which focused on equal
opportunities and non-discriminatory activities at workplace.
4. R&D:

All new features were produced in-house in the last round. Further R&D investments
made for technology 3 and technology 4. All 10 features completed for technology 2 and
3 extra features bought for technology 4.

5. Marketing:

USA - focus on brand. We priced tech 4 (6 features) at $330 and tech 2 (9 features) at
$280. This is a promotion-sensitive market, so we allocated $68000k for its promotion.
The prices for other markets were determined and influenced by the given exchange
rates. Also, the prices were kept a low level given the ongoing price war

Asia - Focus on Balanced and Sustainability marketing strategy.We priced tech 3 (4

features) at 2200 RMB and tech 1 (8 features) at 1799 RMB. This is a price-sensitive
market, so we are focusing on keeping the price low and promoting it to be at $143000k.

Europe - Focus on Brand and Balanced. We priced tech 4 (8features) at 340 EUR and
tech 2 (10 features) at 300 EUR. For promotion, we used $34000 K .

6. Logistics

Priorities were decided based on unit margins and tariff costs: USA, Asia, and Europe

7. Tax

Using transfer pricing, the effective tax rate was reduced to 9.7. With losses $7989 K
carried forward in the next round

8. Finance

80000 K USD cash was transferred from Asia to the USA(Internal Loan) to reduce the
loss being carried forward. Cash was also transferred from the USA to Europe for
promotions.