1. (10 pts.) Stella Ann Freeman is having a difficult time deciding whether or not to purchase a new car. How would understanding the concept of opportunity costs help her make a decision? According to (Brickely, Smith & Zimmerman, 2016), the opportunity cost for using resources for any given purpose it’s the value for which is the best alternative usage. To better understand this concept, Stella Ann Freeman will have to make a decision that will not only affect her but economically. Firstly, Stella needs to come with an analytical and option for how the funds will be used. The decision to purchase a new vehicle raise other concerns on what important other things she is willing to give up on. For example, taking a family vacation to another …show more content…
This was a major problem in that aspect and by that implementation; Enron has no control over the situation and eventually cause the lack of error after hearing of the reports of the Company. Secondly, the rewarding individual was also critical. The main focus of Enron was more concentrated on having close deals and seeing them being competitive at the end of every company quarter. Their idea was as same as a car dealership, if you cannot bring in money then the sales person will not have a job, likewise with Enron, if you cannot make money then you will be jobless. In any business one key thing to remember is that employees are more important than clients. Enron kept putting their clients ahead of their employees, which was one of the downfalls. And lastly, in this case one of the key issues was the performance structure and evaluation. Enron initially had place performance was intractable. While employees were persuaded to close deals regardless of any unethical issues that may arise later, it clearly shows the lac of management structure. This incorporates employees by enabling them to make more perilous decisions at any cost because they deals must be closed. Enron attitude towards the future were now and right at the moment and not focusing on the long run. I believed a strategic management plan should be in place, which includes the hierarchical management including specific charts following its management performance