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The A case describes the start of a new business, Telezoo, and the challenges facing a start-up as it attempts to develop a unique place for itself in the marketplace.

Dick Mayo, one of the most celebrated value investors in America was puzzled by the New Economy's continuous bias toward growth investment strategies. He examines the basics of his philosophy versus that of a growth orientation by evaluating the long-term expected returns of several value and growth stocks. This case can be used to pursue several objectives: (1) to define value and growth investing--where the differences lie and whether one approach is superior to the other or whether both have merit; and (2) to discuss issues related to consistency of one's investment philosophy. Should one stay true to one's philosophy even when the market seems to run counter to it for a prolonged period of time? Can value investing deliver value in this New Economy or is it only an Old Economy concept? The students are instructed to perform basic valuations of Cisco Systems (a growth company), CVS, R.R. Donnelley, and Manor Care (value companies) and compute their long-term expected returns. The case comes with an Excel spreadsheet containing the data and relevant valuation ratios for the above firms. The valuations are straightforward, but they tell an interesting story: the expected returns of glamorous stocks in reality may not be so glamorous.

The key objectives of this case are to: (1) familiarize students with a simple version of the Markowitz optimal-asset allocation model; (2) develop students' intuition regarding optimal-asset allocation as specific inputs into the model (e.g., expected returns, standard deviations, correlations) change values; and (3) develop students' intuition regarding constraints that alternative investors may face (e.g., the presence of shorting constraints) and their impact on the optimal portfolio.

Explores the controversy over the pricing of AIDS drugs in poor countries. This issue has received wide publicity due to two events: 1) a court case in South Africa that seeks to force drug companies to license their patents and 2) the announcement by the Indian pharmaceutical firm, Cipla, that it would copy U.S. firms' AIDS drugs and sell them at cost to countries in Africa. Made up of excerpts from 10 articles and highlights the intense feelings on both sides of the issue. Encourages students to think about the short- and long-term consequences of various approaches, the role of government and international institutions, and the pressures facing drug company executives.

Strategic Capital Management, LLC, is a hedge fund that is planning to make financial investments in Creative Computers and Ubid. Creative Computers recently sold approximately 20% of its Internet auction subsidiary, Ubid, to the public at $15 per share. Ubid's stock price closed the first day of trading at $48, giving Ubid a $439 million market capitalization. Paradoxically, the parent's stock price did not keep pace with that of its subsidiary. At the end of Ubid's first day as a public company, Creative Computers' equity value was less than the value of its stake in Ubid. The market prices implied that Creative Computers' non-Ubid assets had a value of negative $79 million. The relative prices and ownership link between Creative Computers and Ubid suggest a potential arbitrage opportunity. To evaluate how best to exploit this investment opportunity, Elena King, the manager of the hedge fund, must understand both the risks and expected returns associated with different long and short equity positions.

Supplements the (A) case.

Supplements the (A) case.

Southwest Airlines is well known as the low-fare airline that has achieved ongoing financial success in one of the most financially troubled industries in the United States. Told from the perspectives of two Southwest customers--a frequent flier and a more typical customer--the case revolves around two customer service requests from the frequent flier, both of which provide a compelling temptation to cater to the satisfaction of the airline's highest revenue customers. The requests are intriguing because they would neither add cost nor increase the turnaround time of Southwest's service.

After its spin-off from one of the world's largest ultrasound makers, Sonosite attempts to popularize a new kind of handheld ultrasound units. Sonosite needs to decide if it should focus on new markets that will value the portability and ease of use of its products, or if it should evolve its offerings so that they appeal to radiologists and cardiologists, the largest purchasers of ultrasound systems.

In a deal marking the first acquisition of a domestic Japanese financial institution by foreigners, a consortium of Western investors purchased the assets of the Long Term Credit Bank (LTCB) of Japan in March 2000. The new management renames the bank Shinsei Bank, meaning new birth, and sets about implementing a bold new strategy calling for a hybrid bank that includes commercial, retail, and investment banking activities, managed according to Western banking principles. This case reviews the events that led up to LTCBs failure, nationalization, and subsequent purchase. The job of making the hybrid bank work falls to Shinsei president and CEO Masamoto Yashiro. Yashiro wonders how he can manage this hybrid bank.

Supplements the (A) case.

Supplements the (A) case.

One year later, Yashiro and his management team can be proud of the young bank's first-year results, but face a set of difficult implementation issues.

This technical note introduces students to the concept, use, and mechanics of flexible budgeting. It is best used at the beginning of a course module on budgeting or performance measurement/management.

The case provides the background for a hands-on data-mining exercise. The purpose of the analysis is to identify high value customers of an online retailer in order to give them VIP treatment. The exercise is described in "Identifying the VIPs at eTOTS" (UV2918).

This case contains the instructions for a hands-on data-mining exercise. The purpose of the exercise is to identify high value customers of an online retailer in order to give them VIP treatment. The exercise uses purchase data for 60,000 customers. The background is described in "Customer Care at eTots.com" (UV2916).

Spreadsheet supplement for UV2916 and UV2918.

Spreadsheet supplement for UV2916 and UV2918.