Question
GM Case HBS - Is this correct table? 1. JPY depreciation 20% GM assumption-P. 13 2. JPY content per vehicle 30% Sensitivity range given in
GM Case HBS - Is this correct table?
1. JPY depreciation 20% GM assumption-P. 13
2. JPY content per vehicle 30% Sensitivity range given in P. 13
3. Cost savings passed onto consumers 30% Find the info from the case-sensitivity range given in P. 13
4. Vehicle price reduction 1.800% 1*2*3
5. Sales elasticity 2 Find the info from the case text P.13
6. Japanese annual sales in US (units) 4,100,000 Find the info from the case P.13
7. Increase in Japanese sales (units) 147,600 4*5*6
8. Cross elasticity to GM 0.33 Find the info from the case P.13
9. Loss in GM sales (units) 48708 7*8
10. GM unit contribution margin 5907 Calculated based on information in case text and Exhibit 16
11. GM pre-tax loss (millions) 287,718,156 9*10
12. Discount rate for a perpetuity 20% Find the info from the case- first line on P.14
13. Present value of loss (million) 1,438,590,780 11/12
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