XAT 2019 — Decision Making Question 21
Read the following caselet and answer the questions that follow
Due to increased competition, Electro Automobiles, the Indian subsidiary of Robert Automobile Company (RAC) reported lower sales and profits. RAC expects its new model Limo, developed especially for value conscious customers of India and China, would revive its fortunes. In order to prevent customers from buying competing products, RAC announced the launch of Limo six months ahead of schedule. Unrest in its Indian supplier resulted in delayed delivery of essential components to its main plant. Hence, Limo was launched on schedule only in China. Within a short span, Limo captured 30% of the Chinese market , which was 200% higher than expectation. Indian customers were becoming increasingly restless because they couldn't get a Limo in India. Electro’s dealers were worried, customers might switch to other cars.
Mr. Murugan from Chennai experienced the comfort of Limo during his visit to China. He was willing to deposit an approximate price of Limo to buy the first available unit from Mr. Ahmed, a dealer in Chennai. Electro Automobile is yet to announce the actual price, and the process for allocation of the vehicles. Which of the following is the best option for Ahmed?
Answer & solution
Collect the entire amount Mr. Murugan is willing to deposit after clarifying that delivery and price is subject to the company policy.
- B
Collect the amount from Mr. Murugan. Later when the delivery is delayed, blame it on RAC’s problems.
- C
Collect the amount and transfer it to the account of Electro Automobiles, instead of keeping it in his personal account.
- D
Collect 50% of the entire amount Mr. Murugan is willing to deposit as advance and the remaining at the time of launch.
- E
Not collect the amount, but suggest to Mr. Murugan to write to Electro Automobiles.
Since Mr. Murugan is willing to deposit an approximate price of Limo to buy the first available unit from Mr. Ahmed, there is no harm in collecting the entire amount that he is willing to deposit. Since Electro Automobile is yet to announce the actual price, Mr. Ahmed should clarify that delivery and price is subject to the company policy. Thus [1] is the best choice for the answer. [2] is unethical. [3] does not address that part that the price is not final. [4] does not make sense when Mr. Murugan is ready to deposit the full price. [5] may result in Mr. Ahmed losing the deal if Mr. Murugan loses his interest. Compared to [1], option [5] is not better in any way.
Hence, the correct answer is option 1.