A finished DBA-815 Topic 1 decision sorting memo example, placing a fitness chain's pending decisions by what economic reasoning can settle, inform or not reach, naming the deciding quantity for each. Searches like "dba 815 topic 1 assignment example", "dba815 topic 1 sample" and "dba-815 topic 1 example" land here.
What a finished DBA-815 Topic 1 decision sorting memo looks like
Five decisions reach the memo, all from a composite chain charging $49 a month. Two can be decided by economics once one number is known: a proposed cut to $39 near a rival turns on the chain's own-price elasticity, still unestimated, and closing the weakest club turns on avoidable cost and a lease date, with the recent renovation kept out of both sides. Two can only be informed. A growth target of more members is recast as a contribution question, since members bought at a lower margin can shrink profit. An annual contract can be priced, but DellaVigna and Malmendier's finding that gym members on flat fees overestimate their attendance means part of its revenue rests on a predictable mistake, which the chain must judge. A youth sports sponsorship stands alone: economics can cost it but not value it.
How a DBA-815 Topic 1 example is structured
The memo is written for the chain's executive team and opens with its sorting rule, which rests on whether a marginal comparison can be estimated. The five decisions are listed next in the order the team raised them, each with a one-line statement of what is being chosen. Three bins follow. The first holds the price cut and the closure, and for each the memo names the missing quantity and where it would come from. The second holds the growth target and the annual contract, where economic reasoning reshapes the question without closing it, and the behavioral evidence on flat-fee contracts is summarized there. The third holds the sponsorship, costed and then handed back to the team as a question of values. A final section ranks the open quantities by how much money rides on each, putting the elasticity estimate first.
A rule for what economics decides
A decision belongs to economics when it turns on a marginal comparison whose terms the chain could estimate, and the memo applies that rule to all five.
The price cut waits on elasticity
Cutting dues from $49 to $39 pays only if members respond strongly enough, and the chain has no firm-level estimate of that response yet.
A closure decided without the renovation
Money spent renovating the weakest club two years ago is gone whichever way the board votes, so the memo keeps it out of the comparison.
Growth recast as contribution
More members at a lower margin can mean less profit, so the growth target is rewritten as a contribution target before anyone prices toward it.
Annual contracts and a predictable mistake
Flat-fee members tend to overestimate their future attendance, so the memo prices the contract and then asks the team whether that margin is one it wants.
A sponsorship economics cannot value
The youth sports program is costed at its full annual outlay and returned to the executives, since its worth to the chain is a question of values.
Where marks go in DBA-815 Topic 1
A memo that applies economics to everything, sponsorship included, shows enthusiasm for the tools and no judgment about their reach, which is what this topic assesses. The opposite error, treating the price cut as a matter of executive instinct, surrenders a decision economics can actually settle. Letting the renovation cost into the closure discussion is typically marked wrong outright, since money already spent cannot change which option leaves the chain better off. Papers that accept a membership growth target at face value miss that volume bought with margin can lower profit. Citing behavioral findings to dismiss standard reasoning overshoots, because DellaVigna and Malmendier's result shows where one assumption fails, not that pricing analysis is useless. Memos that name no missing quantity leave the team with categories and nothing to go and find.
Get a DBA-815 Topic 1 example written to your instructions
Send the DBA-815 Topic 1 instructions, your classroom rubric and the firm, case or decisions the assignment describes. The custom example is written to those requirements, with a sorting rule stated, each decision placed and its deciding quantity named, sunk spending kept out and the limits of the standard model marked, returned in 24 to 48 hours. The first one is free.
DBA-815 Topic 1 questions, answered
What did DellaVigna and Malmendier find about gym contracts?
Stefano DellaVigna and Ulrike Malmendier studied health club members and found that many who chose flat monthly fees attended too rarely for the fee to beat paying per visit, and that members tended to overestimate how often they would go. They read this as overconfidence about future self-control. The example uses the finding to mark where a standard assumption, accurate self-prediction, stops holding for this firm.
Why can't the renovation cost count in the closure decision?
Because it has already been paid and nothing the board decides now can recover it. Keeping the club open does not earn the renovation back, and closing it does not waste the money a second time. What differs between the options is future revenue and future cost, including the lease until its break date. The example keeps the renovation visible in the memo precisely so the team can see it being set aside.
Is a youth sponsorship really outside economics?
Its cost is inside economics and the memo states it in full. Its value is harder. The chain could try to measure brand or referral effects, but the executives proposing it describe it as something the company should do regardless of return. Economic reasoning can tell them what that commitment costs and what it displaces. Whether it is worth that price is a judgment the memo returns to them rather than pretending to settle.