Burnside Marketing Research conducted a study for Barker Foods on several formulations for a new dry cereal. Three attributes were found to be most influential in determining which cereal had the best taste: ratio of wheat to corn in the cereal flake, type of sweetener (sugar, honey, or artificial), and the presence or absence of flavor bits. Seven children participated in taste tests and provided the following part-worths for the attributes (see 13.4: Applications Involving Binary Variables): Wheat/Corn Sweetener Flavor Bits Child Low High Sugar Honey Artificial Present Absent 1 15 35 30 40 25 15 9 2 30 20 40 35 35 8 11 3 40 25 20 40 10 7 14 4 35 30 25 20 30 15 18 5 25 40 40 20 35 18 14 6 20 25 20 35 30 9 16 7 30 15 25 40 40 20 11 (a) Suppose the overall utility (sum of part-worths) of the current favorite cereal is 70 for each child. What product design will maximize the number of children in the sample who prefer the new dry cereal. Note that a child will prefer the new dry cereal only if its overall utility is at least 1 part-worth larger then the utility of their current preferred cereal. Product Design: Wheat/Corn Low or High Sweetener Sugar or Honey or Artificial Flavor Bits Absent or Present Share of Choice (b) Assume that the overall utility of the current favorite cereal for children 1 to 4 is 71, and the overall utility of the current favorite cereal for children 5 to 7 is 80. What product design will maximize the number of children in the sample who prefer the new dry cereal? Note that a child will prefer the new dry cereal only if its overall utility is at least 1 part-worth larger than the utility of their current preferred cereal. Product Design: Wheat/Corn Low or High Sweetener Honey or Artificial or sugar Flavor Bits Absent or Present Share of Choice

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Question

Burnside Marketing Research conducted a study for Barker Foods on several formulations for a new dry cereal. Three attributes were found to be most influential in determining which cereal had the best taste: ratio of wheat to corn in the cereal flake, type of sweetener (sugar, honey, or artificial), and the presence or absence of flavor bits. Seven children participated in taste tests and provided the following part-worths for the attributes (see 13.4: Applications Involving Binary Variables):

	Wheat/Corn	Sweetener	Flavor Bits
Child	Low	High	Sugar	Honey	Artificial	Present	Absent
1	15	35	30	40	25	15	9
2	30	20	40	35	35	8	11
3	40	25	20	40	10	7	14
4	35	30	25	20	30	15	18
5	25	40	40	20	35	18	14
6	20	25	20	35	30	9	16
7	30	15	25	40	40	20	11

(a)

Suppose the overall utility (sum of part-worths) of the current favorite cereal is 70 for each child. What product design will maximize the number of children in the sample who prefer the new dry cereal. Note that a child will prefer the new dry cereal only if its overall utility is at least 1 part-worth larger then the utility of their current preferred cereal.

Product Design:
Wheat/Corn	Low or High
Sweetener	Sugar or Honey or Artificial
Flavor Bits	Absent or Present

Share of Choice

(b)

Assume that the overall utility of the current favorite cereal for children 1 to 4 is 71, and the overall utility of the current favorite cereal for children 5 to 7 is 80. What product design will maximize the number of children in the sample who prefer the new dry cereal? Note that a child will prefer the new dry cereal only if its overall utility is at least 1 part-worth larger than the utility of their current preferred cereal.