MARKETPLACE simulation

Critically evaluate the roles of the following objectives (effects) in the MARKETPLACE simulation:

i) market share;
ii) contribution & contribution margin;
iii) balanced scorecard;
iv) creation of wealth.
Illustrate your answer with data from Q#7 of the simulation.


The exchange reproduced below is from an interview of then Senator (now former President) Obama by then Anchorman Charles Gibson of ABC News. Mr. Gibson is pointing to data that indicates that the US Government has collected more tax revenue at lower rates while Mr. Obama wants higher rates as capital gains are an income source primarily accruing to high income (rich) taxpayers and he cites fairness as his criterion.

GIBSON: And in each instance, when the (capital gains tax) rate dropped, revenues from the tax increased; the government took in more money. And in the 1980s, when the tax was increased to 28 percent, the revenues went down. So why raise it at all, especially given the fact that 100 million people in this country own stock and would be affected?

OBAMA: Well, Charlie, what I’ve said is that I would look at raising the capital gains tax for purposes of fairness.

i) Evaluate these 2 positions (“high” capital gains tax rates versus “low” capital gains tax rates) from both deontological and consequential ethical perspectives.
ii) Which of the above 2 perspectives do you find more persuasive? Explain your reasoning.
iii) Why do you think that lowering the capital gains tax rate results in higher tax collections? Explain!





Sample Solution