Chapter 17, Problem 3CP

Summary Introduction

(a)

Case summary:

A multinational company named as Universal auto which was headquartered in the US. For accounting purpose, it has 2 segments

1. Production of the motor vehicle
2. Information processing services

Production of a motor vehicle is a larger vertical of Universal auto which produces cars as well as trucks for the US and for other countries. Nevertheless, it has weak operation results over the years including the current year.

Whereas Information processing service vertical is started 15 years ago, this vertical has steady growth.

Research report indicates that Universal can increase its price of passenger cars which can improve its profitability.

The character in this case:

Universal auto, First segment of production of the motor vehicle, Second segment of information processing service

To construct:

1. Industrial life cycle
2. Identify in which phase of the segments are
3. Product pricing strategy for the segment

Introduction:

The life cycle of industrial has four-phases:

1. Conception
2. Growth
3. Maturity
4. Decline.

Duration of each phase varies with the respective industry. But this theory is different for manufacturing of goods and service, specifically for internet communications technology

Summary Introduction

(b)

Case summary:

A multinational company named as Universal auto which was headquartered in the US. For accounting purpose, it has 2 segments

1. Production of the motor vehicle
2. Information processing services

Production of a motor vehicle is a larger vertical of Universal auto which produces cars as well as trucks for the US and for other countries. Nevertheless, it has weak operation results over the years including the current year.

Whereas Information processing service vertical is started 15 years ago, this vertical has steady growth.

Research report indicates that Universal can increase its price of passenger cars which can improve its profitability.

The character in this case:

Universal auto, First segment of production of the motor vehicle, Second segment of information processing service

To construct:

1. Industrial life cycle
2. Identify in which phase of the segments are
3. Product pricing strategy for the segment

Introduction:

The life cycle of industrial has four-phases:

1. Conception
2. Growth
3. Maturity
4. Decline.

Duration of each phase varies with the respective industry. But this theory is different for manufacturing of goods and service, specifically for internet communications technology

Summary Introduction

(c)

Case summary:

A multinational company named as Universal auto which was headquartered in the US. For accounting purpose, it has 2 segments

1. Production of the motor vehicle
2. Information processing services

Production of a motor vehicle is a larger vertical of Universal auto which produces cars as well as trucks for the US and for other countries. Nevertheless, it has weak operation results over the years including the current year.

Whereas Information processing service vertical is started 15 years ago, this vertical has steady growth.

Research report indicates that Universal can increase its price of passenger cars which can improve its profitability.

The character in this case:

Universal auto, First segment of production of the motor vehicle, Second segment of information processing service

To construct:

1. Industrial life cycle
2. Identify in which phase of the segments are
3. Product pricing strategy for the segment

Introduction:

The life cycle of industrial has four-phases:

1. Conception
2. Growth
3. Maturity
4. Decline.

Duration of each phase varies with the respective industry. But this theory is different for manufacturing of goods and service, specifically for internet communications technology