Questions:
1. Assume that your bond has an interest rate of 10 percent when other bonds are paying 12 percent. Investors will not want to buy your bond if they can earn 12 percent elsewhere. What can you do to get investors to buy your 10 percent bond?
2. The relationship between risk and return:
What is in your opinion the relationship between risk and return?
Do you buy lottery tickets?
Why do people buy lottery tickets?
Why do you buy them?
How many of you would buy a $1 lottery ticket if the jackpot were $1 million?
How many of you would buy a $1 lottery ticket if the jackpot were $10 million?
How many of you would buy a $1 lottery ticket if the jackpot were $50 million?
How many of you would buy a $1 lottery ticket if the jackpot were $1.04?
Why wouldn't you buy the lottery ticket that pays $1.04? That's a 4 percent return on your money if you win.
Some folks keep money in savings accounts that earn less than 4 percent.
If you were a large (over/under $ 1 million) lottery or sweepstakes winner, how would you determine whether you would want the sweepstakes prize today or over ten years if you could earn only 6 percent interest on the investments?
3. Discuss the role of the manufacturers' agent in a marketing manager's promotion plans.
• What kind of salesperson is a manufacturer's agent?
• What are the best kind of compensation plans for these agents?
• Provide some specific examples/research in your post.