Financial Advice and Other Info

What is an IRA?

IRA:

- Individual Retirement Account

- A U.S. tax-advantaged account you use to save and invest for retirement.

Traditional IRA:

- You may get a tax deduction for contributions; investments grow tax-deferred; withdrawals in retirement are taxed as ordinary income; required minimum distributions (RMDs) apply later in life.

- No tax now, tax later

Roth IRA:

- Contributions are after-tax (no deduction); investments grow tax-free; qualified withdrawals are tax-free; no lifetime RMDs for the original owner.

- Tax now, no tax later

SEP (Simplified Employee Pension Plan) IRA:

- allows employers to contribute to traditional IRAs set up for employees. A business of any size, even self-employed, can establish a SEP.

SIMPLE IRA:

- For small employers; employees can defer salary and employers must contribute.

Rollover IRA:

- Used to move money from a 401(k)/403(b) or another IRA without taxes if done properly.

Key rules (high level):

- There's an annual contribution limit (varies by year and age).

- Deductibility (Traditional) and eligibility (Roth) can phase out at higher incomes or if you're covered by a workplace plan.

- Withdrawals before age 59½ generally face a 10% penalty plus taxes (Traditional), with some exceptions (e.g., certain education costs, first-home purchase, some medical expenses).

- Non-Roth IRAs have RMDs; Roth IRAs don't for the original owner.

What is a SBLOC?

Securities Backed Line of Credit:

- A securities-backed line of credit is a way to get cash for your needs in the near term, guaranteed by your investments, such as stocks, bonds, mutual funds, and exchange-traded funds (ETFs).

- You don't have to sell those securities. Depending on the firm, you may be able to borrow money equivalent to 50% to 95% of your assets' value.

- Monthly interest payments; principal due when you choose (or if the lender calls the loan). Rates are usually variable (often tied to SOFR/prime plus a spread).

- The more eligible collateral, the larger the line of credit, and possibly the lower the interest rate.

- Once you're approved for the line of credit, the money is available whenever you need it, and you don't have to pay anything until you draw from the line of credit.

- You can use the money for almost anything except for

buying more securities.

What is a debt Snowball?

- The debt snowball method is a debt-reduction strategy where you pay off debt in order of smallest balance to largest balance, gaining momentum as you knock out each balance.

- When the smallest debt is paid in full, you roll the minimum payment you were making on that debt into the next-smallest debt payment.

Here's how the debt snowball works:

- Step 1: List your debts from smallest to largest (regardless of interest rate).

- Step 2: Make minimum payments on all your debts except the smallest debt.

- Step 3: Throw as much extra money as you can on your smallest debt until it's gone.

- Step 4: Take what you were paying on your smallest debt and add that to your payment on the next-smallest debt until it's gone too.

- Step 5: Repeat until each debt is paid in full and you're completely debt-free!

- As you knock out your debts one by one, the amount of money you have to throw at the rest of your debt grows—kind of like a snowball rolling down a hill (hence the name). And the excitement you get from paying off your smallest debt super quick will motivate you to keep plowing through your debt, all the way to that debt-free finish line!

Why it works:

- The debt snowball works because it's all about changing your behavior. Trust me, you don't need to have a finance degree or be a mathlete to beat debt. Your mindset has more to do with this equation than math ever will. In fact, personal finance is 80% behavior and only 20% head knowledge.

- The quick wins you get with the debt snowball help you believe you can actually pay off your debt. And if you believe it, you'll start behaving like it. That's why it worked for me.

What a 529 plan can be used for?

- Investment account to be used for education

- Earnings grow tax-deferred, qualified withdrawals are tax-free, and some states (like Iowa) have other tax benefits as well

- Not taxed if used for tuition, fees, books, etc. for college

What does OPM stand for?

Annual Out-of-Pocket Maximum:

- after you spent this amount on deductibles, copays, coinsurance, your health plan pays 100% of the costs

- It's the most you'll pay in a plan year for covered care. After you hit this cap, your health plan pays 100% of covered services for the rest of the year.

Quick notes:

- Counts toward it: deductible, copays, coinsurance.

- Doesn't count: monthly premiums, non-covered services, and often out-of-network charges (depends on plan).

- Applies per plan year; many plans have both individual and family OPMs.

Example:

- If your OPM is $8,000 and you've paid that much in deductible/copays/coinsurance, you won't pay more for covered care that year

What's a deductible?

- the amount you pay before insurance starts to pay

- A deductible is the amount you pay out of pocket for covered services each plan year before your insurance starts sharing costs.

Quick hits:

- You pay 100% of covered costs until you've met the deductible.

- After that, you typically pay copays/coinsurance and the plan pays the rest—up to your out-of-pocket maximum.

- Many plans have separate individual vs. family deductibles; some also have separate in-network/out-of-network or drug deductibles.

- Preventive care is often covered before the deductible.

Example:

- With a $1,500 deductible and 20% coinsurance, you pay the first $1,500 of covered care, then 20% of additional covered costs until you hit your out-of-pocket max.

What's the first thing Rob's brother in law bought after bankruptcy?

- Guns

CHAPTER 12 TEST QUESTION Black Hole Company

- saturn went out of business

- originally was unique with door handles, etc.

- then general motors made it looks like every other car and it failed

CHAPTER 10 TEST QUESTION: 5 V's of big data

1. Volume of big data:

2. The variety of big data:

3. The velocity dimension of big data:

4. Veracity of big data:

5. The value of the big data:

McDonald's introduced a Favorites Under 400 Calorie Menu to reverse the perception that it sells only less healthy food. Suppose that as a follow-up the fast-food chain collects and analyzes social media posts from Facebook, Twitter, and similar sites, hoping to understand whether consumer perceptions are improving. This effort would be an example of

C - sentiment analysis.

A marketing research project often begins with a review of the relevant ________ data.

B - secondary

Howard Moskowitz's big contribution to marketing was __________.

C - Horizontal Segmentation

When an Idaho-based discount hardware chain sent snow shovels to its Augusta, Georgia, store in April, it was engaged in

E - misguided geographic segmentation.

Tariffs protect domestic producers by

D - making imported products more expensive.

If "Joe to Go" decides to enter into contracts allowing local businesses to use its coffee trademark and business format, it would be considering which strategy for international growth?

D - franchising

At many universities, education faculty members were among the first to ask for course management systems that would allow them to keep track of their students' grades and progress more efficiently. These faculty members were ________ in the buying center.

No submission likely "initiators"

Elizabeth knows it is important to approach business buyers at the right time, often during the first stage of their buying process, which is

No submission likely "need recognition"

_______ is ultimately about designing a product to be more cost effective, often by using less parts.

B - Design for Manufacturing

Harley Davidson's new line of electric motorcycles is experiencing low sales and small, almost non-existent profits. In which product life cycle stage is it?

A - introduction

What company thought of the concept that became the iPhone?

C - General Magic

A few Tesla customers are asked to try out a new car that has not yet been released on the market. This is an example of

A - beta testing

One of the difficulties in running a successful shoe company like Naturalizer is the need to have significant ________, a large number of items in each product line in many sizes and colors.

C - product line depth

A sales person who cold calls you to sell a cemetery plot is most likely offering what type of product?

A - unsought product

1.In the context of the Business-to-Business (B2B) buying process, what is the primary difference between a 'Straight Rebuy' and a 'Modified Rebuy'?

A. A Straight Rebuy is handled by the user, while a Modified Rebuy must be approved by the entire buying center.

B. A Straight Rebuy is for services while a Modified Rebuy is for physical products.

C. A Straight Rebuy is a first-time purchase for an organization, while a Modified Rebuy is any subsequent purchase.

D. A Straight Rebuy involves reordering the same goods without changes, whereas a Modified Rebuy involves some change to the original order.

D. A Straight Rebuy involves reordering the same goods without changes, whereas a Modified Rebuy involves some change to the original order.

2. According to the lecture on the development of New Coke, what psychological principle might explain the public's strong desire for the original formula after it was taken away?

A. Social Proof

B. The Pareto Principle

C. Diffusion of Innovation

D. Brehm's Psychological Reactance

D. Brehm's Psychological Reactance

3. Which global market entry strategy typically involves the highest level of risk and financial commitment for a firm, but also offers the greatest potential for returns and control?

A. Direct Investment

B. Licensing

C. Joint Venture

D. Exporting

A. Direct Investment

4. What is the primary goal of market positioning?

A. To analyze the performance of a new product after it has been launched.

B. To select the most attractive market segments for the company to pursue.

C. To create a clear, distinctive, and desirable understanding of a product in the target customer's mind.

D. To divide the total market into smaller, more manageable groups of consumers.

C. To create a clear, distinctive, and desirable understanding of a product in the target customer's mind.

5. When a company uses the same brand name for a new product in a different product line (e.g., Ferrari apparel), it is an example of a:

A. Brand Extension

B. Line Extension

C. Brand Repositioning

D. Co-Branding

A. Brand Extension

6. In the product development process, what is the key difference between alpha testing and beta testing?

A. Alpha testing is conducted by employees within the firm, whereas beta testing uses potential customers.

B. Alpha testing focuses on the product's marketing, while beta testing focuses on its technical performance.

C. Alpha testing is done by potential customers, while beta testing is done by company employees.

D. Alpha testing is done with a final, market-ready product, while beta testing uses early prototypes.

A. Alpha testing is conducted by employees within the firm, whereas beta testing uses potential customers.

7. Which of the following describes psychographic segmentation?

A. Grouping customers by where they live, such as by region or city.

B. Grouping customers by their product usage rate and brand loyalty.

C. Grouping customers by their lifestyle, self-concept, and values.

D. Grouping customers by their age, gender, and income.

C. Grouping customers by their lifestyle, self-concept, and values.

8. During which stage of the Product Life Cycle are sales rising, profits rapidly increasing, and the typical consumers are early adopters and the early majority?

A. Maturity

B. Growth

C. Decline

D. Introduction

B. Growth

9. What is the primary advantage of using primary research over secondary research?

A. The data is specific to the immediate needs and topic at hand.

B. It is less expensive and quicker to collect.

C. The data sources are always original and unbiased.

D. It requires less sophisticated training to design and collect.

A. The data is specific to the immediate needs and topic at hand.

10. Kraft markets several product lines like cheeses and dressings under the 'Kraft' name, but also owns distinct brands like Velveeta and Jell-O. This indicates that Kraft uses:

A. A co-branding strategy with its own brands.

B. Only an individual branding strategy.

C. Both family and individual branding strategies.

D. Only a family branding strategy.

C. Both family and individual branding strategies.

11. The lecture detailed how Dr. Martin Elliot was inspired by a Formula 1 pit stop to improve hospital procedures for premature babies. What was the key process improvement he adopted from the F1 team?

A. Using more advanced and expensive medical technology.

B. Hiring more staff to swarm the problem and resolve it faster.

C. Increasing the speed of information handover through a new computer system.

D. Ensuring every team member had a specific, well-defined job to perform.

D. Ensuring every team member had a specific, well-defined job to perform.

12. Which of the following is NOT considered one of the four key components of brand equity discussed in the source material?

A. Brand Awareness

B. Market Saturation

C. Perceived Value

D. Brand Loyalty

B. Market Saturation

Chapter 9 Notes

Orbitz (2011):

- Mac users pay $20-30 more on hotel rooms

- 40% higher chance of 4- or 5-star hotel

- Same hotel, mac users pick more expensive rooms

Chapter 10 Notes

Brehm's psychological reactants:

- If you give something to someone and you take it away then they want that something even more

Example:

- Busch Apple

Tabs:

- Pepsi Challenge, New Cola

- You want something more when it is taken away

Redbull:

- Make it taste bad (medicinal) to be good

- Give it a smaller can

Structured vs. Unstructured

- arm and hammer baking soda ask people what they use it for (unstructured)

- Lady said she keeps it in freezer to eliminate odors

TEST QUESTION

- 5 V's of big data

Chapter 11 Notes

Mercedes billion dollar mistake:

- Garbage in garbage out

- Worn way tread and everything they modeled goofed up and they lost championship, sponsors, drivers

- Don't model on false things

Flavor Fave

- Flav's fried chicken (clinton iowa) (old long-john silver)

- Next to kfc and steal their identity (white and red)

- so many kids couldn't afford child support so had a bunch of businesses

- flavor love (love island)

Sonic Branding:

- Little jingles, bleeps, tactics, everything that make it easy to buy and remember brands and spend more money

- like the little noise it makes when you tap your card

Brand loyalty

- younger is better

- people more loyal to retailers

- convenience is huge

Uncrustable / Trader Joe's:

- trader joes is copying uncrustable

Chapter 12 Notes

Peter Drucker Quote

"Business has only two basic functions: marketing and innovation"

Sources of new product ideas:

- most ideas come from consumer facing employees

- customers are good at iterating not prototyping

- Consortiums are companies that come together and invest ina company then comes up with new ideas

- licensing is buying rights to use a product

New Product Development process

- Cedar Rapids were similar to US demographics so a lot of consumer test companies would do it in cedar rapids

- various successful companies (such as apple) get a diverse team (marketers, engineers, manufacturers) to handle their specialized aspect all at once

- stagegate (Pratt, etc)