McGregor's Limited: Department Store.

* Step 1: Situational Analysis 1. McGregor's department from its inception has laid a great emphasis on personal service of its clients. James McGregor, the current president doesn't want to destroy its old-world charm, which differentiates it from the other departmental stores. But at the same time he is worried that with an old-fashioned image, he will not be able to attract young customers and eventually would lead to over reliance on the middle aged and elderly clientele. 2. …

…gt;<Tab/>78,326<Tab/>60,467 Savings in Discount = $17,859 In Actual, the spending by the senior executives will go down because of a reduction in the discount rate and the spending by the sales people will go up because of an increase in discount. These effects can be assumed to cancel each other. * Exhibit 2 Savings in Discount = $17,859 Current Year Net Earnings = $3,726,939 Savings in Discount as a percentage of Net Earnings = 0.5%