Please read and answer the questions with substantial and original content.

MT499 Unit 1 Discussion Video Script(case study)

Susan: Hi, I am Susan and my friends Frank, Jimmy, and I have been friends since childhood. We lived in the same neighborhood and attended the same elementary and high schools in Detroit, Michigan. We worked at a local automotive parts plant, although we were unemployed due to a “headcount reduction” at our plant.

In the past, we have had many conversations about starting a carpet cleaning business, considering we all have experience working in carpet cleaning organizations in Detroit. One day, I called Frank and Jimmy to meet for lunch and discuss the possibilities of opening a carpet cleaning company. During lunch, we decided to open a small carpet cleaning business, and spent several hours discussing plans to start the business.

Frank, Jimmy, and I scheduled a meeting with my father to discuss our plans to start a carpet cleaning company and ask for a loan. The carpet cleaning company would provide carpet cleaning services to home owners, numerous apartment complexes, and businesses located throughout the city of Detroit, Michigan, and the surrounding communities. To differentiate our carpet cleaning company from others in the Detroit area, we decided to use environmental friendly, non-toxic cleaning agents and offer free estimates for carpet cleaning. We estimated needing $25,000 in startup capital to fund the business.

The following is a breakdown of our estimated startup capital:

Used carpet cleaning van with installed carpet cleaning equipment: $11,000

Used portable carpet cleaning machine, hoses, wands, sprayers, and additional equipment: $4,000

Internet, computer, fax, printer, phone, website, business license, registration, and business insurance: $5,000

Cash budget for miscellaneous costs: $5,000

Total Startup Capital: $25,000

With a little prodding, my father agreed to give us a three-year $25,000 loan with an interest rate of 8.5%. Our business model was very simple. We entered into a three-way partnership, with me managing the office and Frank and Jimmy performing the carpet cleaning services. Our marketing plan included word of mouth referrals, a website, and using flyers and brochures I created in our office (a small office in my father’s garage). In determining our prices and services, we researched carpet cleaning companies in the Detroit area. Due to a saturated market of carpet cleaning companies, we decided to offer prices 20% lower than our competitors’ prices to create customer demand for our carpet cleaning services.

During the first couple of weeks, we only received a few phone calls from homeowners, although in the third and fourth week, the calls from homeowners picked up and apartment complex managers began to call to request carpet-cleaning services for 1, 2, and 3 bedroom units. Soon we were booked up for weeks in advance.

What was originally designed to be a Monday through Friday 8 to 5 operation, turned into a 7-day business averaging between 12-14hours per day. Frank and Jimmy could not keep up with the number of requests for carpet cleaning, we had serious mechanical problems with the engine in the carpet cleaning van, and our cleaning equipment was constantly in repair. In addition, we were spending too much time conducting free estimates when the clients did not purchase our carpet cleaning service. Customers began to make complaints concerning the quality of our service, missed appointments, and poor customer service.

Frank, Jimmy, and I were exhausted in attempting to provide quality services on a daily basis. Our company, Clean-Air Carpet Cleaning produced a profit in the third and fourth quarter; however, we decided to close the Clean-Air Carpet Cleaning Company after one year in business.

After you watch the case study, please answer the questions:

• What critical errors do you see in the initial planning phase of the Clean-Air Carpet Cleaning Company?
• What economic factors do you think Susan, Frank, and Jimmy should have included in their plans for the Clean-Air Carpet Cleaning Company?
• What operational improvements would you have suggested for the Clean-Air Carpet Cleaning Company?
• What do you think were the main factors contributing to the failure of the Clean-Air Carpet Cleaning Company?

In Module 4, you were introduced to the concept of exponential functions that can be used to model growth and decay. Recall what you learned in The Number e lecture. In this exercise, you will use a Microsoft Excel spreadsheet to calculate the exponential growth of a population of your choosing. (If you use the linked spreadsheet below, it is recommended that you consider relatively small populations and not those of entire nations.)

Click here to open the Microsoft Excel spreadsheet that you will use to perform the calculations for this assignment.

In the spreadsheet, perform the following operations:

1. Input a population value into the box next to Initial Population on the spreadsheet. This population should be anything such as the people, animals, microorganisms, or plants.
2. Input a rate of growth for your population into the box next to Rate 1. Since we are interested in a positive annual percent growth rate per year, this number should be greater than zero percent. Be sure to input this number in the form of a decimal.
3. Repeat the above procedure for Rate 2 and Rate 3. Make sure that the values you select differ by two percent. For example, the values 0.01, 0.03, and 0.05 would be good choices.
4. Under the Time (years) column, input three different year values. Make sure that your values increase by a minimum of ten years. For example, 10, 20, 30 years would be good choices. If you want to see a more dramatic change, select a longer time frame such as 10, 50, and 100 years.
5. When you input all of your data, you’ll see that the spreadsheet has performed the calculations for the future size of each population, rate of growth, and time interval. Additionally, this information will be presented graphically in the chart. To draw an exponential curve for each series, do the following:
   1. Right click on the middle point for one of the series.
   2. Click on add trendline.
   3. Under Trendline Options, select Exponential.
   4. Click Close
   5. Repeat these steps for the other series.

Now that you’ve completed your analysis, it is now time to report the results and examine your findings.

In a Microsoft Word document, respond to the following:

1. Calculate what the future size of the population will be, given a specific initial population, rate of growth, and time interval.

Use the exponential equation: Future value = Present value * exp(rt)

• exp is the base “e”
• r = annual rate of growth expressed as a percent
• t = years

Note: The spreadsheet performed these calculations for you, so you can check the answer you obtain with those in the spreadsheet. In order to perform this calculation, you’ll need to have access to a scientific calculator that will have an ex button in order to perform the exp(rt) calculation. There are a number of free scientific calculators available over the Internet. Additionally, all smartphones have calculator apps that have a scientific mode. Check with your instructor for a list of currently available free options if you do not own a scientific calculator.

1. Repeat the calculation for at least two other values of t; make sure they are at least two years apart from one another. Use the same values you input into the spreadsheet and compare the answers you obtain to those that appear in the spreadsheet.

1. Repeat the calculations using two more selections of population growth rate; ensure that each population growth rate is at least two percent different than the others. Use the same values you input into the spreadsheet and compare the answers you obtain to those that appear in the spreadsheet.

1. Examine the graph that your spreadsheet produced based upon the calculations. Did this graph consist of straight lines or curved lines? Describe the shape of these lines for each growth rate. How did they differ? Why?
2. Explain the implications of growth rate for your population. What do you think will happen over a long period of time if a given population of organisms is allowed to increase without limits? Are there environmental factors that keep populations from growing exponentially unchecked? What would be the impact on environmental resources?
3. Explain the likelihood of your results. Would it be expected that the percent growth rate would stay constant over long periods? Is exponential growth an appropriate assumption for long periods? If not, what other changes in population size might be expected?

For this assignment, you will submit a spreadsheet and a report. The spreadsheet will be the Microsoft Excel file containing your analysis. Name your Microsoft Excel file as follows: LastnameFirstInitial_M5_A1.xls.

The report will be a Microsoft Word document in which you will address all of the questions in this assignment in the form of a narrative. Name your Microsoft Word document as follows: LastnameFirstInitial_M5_A1.docx.