MBA Concept Flashcards and Spaced Review Template

MBA Concept Flashcards and Spaced Review: [Your programme or term]

A bank of 80 original flashcards covering the MBA core (accounting, finance, economics, data and decision analytics, marketing, operations, strategy, leadership and organisational behaviour, negotiation, ethics), with the answers in a separate Answer key, Leitner box rules, a spaced review calendar (1, 3, 7, 14 and 30 days), rules for writing good cards, an export note for Anki and a tracking table. It is for admitted students before day one, core-year students preparing for exams and cold calls, and recruiting candidates refreshing the fundamentals. Numeric answers were computed in Python and are shown with the matching Excel formula. Source basis: the Leitner box method (Leitner 1972) and retrieval, spacing and interleaving research (Cepeda et al. 2006; Karpicke and Roediger 2008; Kornell 2009; Rohrer and Taylor 2007; Dunlosky et al. 2013), written in our own words. All companies and numbers are fictional. Replace every [bracketed] value and every row marked Example.

Document control

How spaced review works

Memory fades quickly after you learn something, and each successful recall tends to make the next fade slower. Spaced reviews beat the same total time spent cramming for long-term retention (Cepeda et al. 2006), and recalling an answer from memory helps far more than re-reading it (Karpicke and Roediger 2008). The gaps between reviews therefore grow: one day, three days, a week, two weeks, a month. These exact gaps are a common practical choice, not a law; the best gap depends on how long you need to remember. Mixing topics within a session (interleaving) trains the skill an MBA exam actually tests: recognising which tool a problem needs (Rohrer and Taylor 2007).

The Leitner system turns the schedule into five boxes. Every card starts in box 1. A correct answer moves the card up one box; a miss sends it back to box 1. Leitner's original scheme used boxes of growing size rather than fixed day counts; the intervals below are a widely used variant, so adjust them to your exam dates.

Spaced review calendar

For each area, plan five reviews after the day you first learn it. In Excel, with the start date in B2, the review dates are =B2+1, =B2+3, =B2+7, =B2+14 and =B2+30.

Card bank A: financial and managerial accounting

A01. How do the income statement, balance sheet and cash flow statement connect?

A02. What is the difference between accrual accounting and cash accounting?

A03. Give three reasons a profitable company can run out of cash.

A04. Northfield Outdoor Co. (fictional) has current assets of 300 and current liabilities of 200 (USD thousands). What is the current ratio, and what does it indicate?

A05. Receivables are 60 and annual credit sales are 730. What are days sales outstanding (365-day year)?

A06. Net income is 50, depreciation 20 and receivables rose by 30, with no other changes. What is cash flow from operations (indirect method)?

A07. Price is USD 60, variable cost USD 36 per unit and fixed costs USD 240,000 a year. What is the contribution margin per unit and the break-even volume?

A08. What makes a cost relevant to a decision?

Card bank F: corporate finance

F01. What is the future value of USD 1,000 invested for 10 years at 5% compounded annually? Give the Excel formula.

F02. A project costs 1,000 today and returns 400 at the end of each of the next three years. What is its NPV at 10%, and should you accept it?

F03. What is the IRR of the project in F02, and why is it consistent with the NPV?

F04. Why should you not rank mutually exclusive projects by IRR?

F05. The risk-free rate is 4%, the equity beta 1.2 and the market risk premium 5.5%. What is the cost of equity under the CAPM?

F06. Using F05, with equity 600, debt 400 (market values), a pre-tax cost of debt of 6% and a 25% tax rate, what is the WACC?

F07. A cash flow of 100 next year grows at 3% a year forever. What is it worth today at a 9% discount rate?

F08. State Modigliani and Miller's Proposition I without taxes, and what changes with corporate taxes.

Card bank E: microeconomics and macroeconomics

E01. A 10% price increase cuts quantity sold by 15%. What is the price elasticity of demand, and what happens to revenue?

E02. What rule gives a profit-maximising firm's output level?

E03. Define opportunity cost with a business example.

E04. How does price relate to marginal cost under perfect competition and under monopoly?

E05. Define a Nash equilibrium.

E06. Why do two competitors often end up cutting prices even though both would earn more if neither did?

E07. A loan pays 6% nominal interest and expected inflation is 3%. What is the real interest rate (exact Fisher relation)?

E08. The spot rate is USD 1.10 per EUR, the one-year USD interest rate 4% and the EUR rate 2%. What one-year forward rate does covered interest parity imply?

Card bank D: data and decision analytics

D01. A launch has a 60% chance of earning 500 and a 40% chance of losing 200. What is its expected value?

D02. How do you fold back (solve) a decision tree?

D03. A sample of 36 customers has a standard deviation of spend of 12. What is the standard error of the mean?

D04. Why does a correlation between advertising and sales not prove that advertising drives sales?

D05. How do you interpret a slope of 2.5 on "advertising (USD thousands)" in a regression of sales (USD thousands) on advertising and price, using observational data?

D06. Define a p-value in one sentence.

D07. What is the expected value of perfect information (EVPI), and why is it useful?

D08. Why do analysts keep a holdout sample when building a predictive model?

Card bank M: marketing

M01. What does STP stand for, and in which order are the steps done?

M02. Name the four elements of a positioning statement.

M03. What are the four Ps of the marketing mix, and who proposed them?

M04. A customer yields a margin of 40 a year, the retention rate is 80% and the discount rate 10%. Margins arrive at the end of each year and the customer must be retained to pay. What is the lifetime value?

M05. Unit cost is 60 and price 80. What are the markup and the margin?

M06. Why compare customer lifetime value with customer acquisition cost?

M07. How does value-based pricing differ from cost-plus pricing?

M08. What does a perceptual map show, and what is its main limit?

Card bank O: operations

O01. A process has three steps with capacities of 40, 30 and 50 units per hour. What is the process capacity, and which step is the bottleneck?

O02. A clinic at Tallow Creek Medical Center (fictional) receives 30 patients an hour, each spending 0.5 hours in the clinic. How many patients are in the clinic on average?

O03. A warehouse holds 60 units of inventory and ships 20 units a day. What is the average flow time?

O04. Annual demand is 12,000 units, the order cost USD 50 per order and the holding cost USD 3 per unit per year. What is the economic order quantity?

O05. Arrivals average 8 an hour and a server can serve 10 an hour. What is the utilisation, and why do waits grow quickly as it approaches 100%?

O06. What is safety stock for?

O07. Why do queues form even when average capacity exceeds average demand?

O08. What does the process capability index $C_p$ compare?

Card bank S: strategy

S01. Name Porter's five forces and what they jointly explain.

S02. What are the primary activities in Porter's value chain?

S03. Under the resource-based view, which attributes make a resource a source of sustained competitive advantage?

S04. Name Porter's generic strategies.

S05. What are the four cells of Ansoff's product-market growth matrix?

S06. What makes an innovation "disruptive" in Christensen's sense?

S07. What are the four actions of the blue ocean ERRC grid?

S08. How can competitive advantage be defined in terms of value created?

Card bank L: leadership and organisational behaviour

L01. Name Tuckman's stages of group development.

L02. What is team psychological safety?

L03. What distinguishes hygiene factors from motivators in Herzberg's theory?

L04. State Vroom's expectancy theory in one formula.

L05. Name the five core job dimensions of the job characteristics model.

L06. What is the first step in Kotter's eight-step model of change, and why does it come first?

L07. How does transformational leadership differ from transactional leadership?

L08. What does the SBI feedback model stand for?

Card bank N: negotiation

N01. What is a BATNA?

N02. A seller's reservation price is USD 900,000 and the buyer's is USD 1,000,000. What is the ZOPA?

N03. What is the difference between a position and an interest?

N04. Why can making the first offer help, and when is it risky?

N05. Distinguish distributive from integrative bargaining.

N06. What is logrolling?

N07. What is a Pareto-efficient agreement?

N08. When should you walk away from a deal?

Card bank X: ethics, ESG and governance

X01. Contrast the shareholder view of the firm with stakeholder theory, naming one classic source for each.

X02. How does consequentialist reasoning differ from duty-based (deontological) reasoning?

X03. What should you do when you have a conflict of interest at work?

X04. What is the difference between financial materiality and double materiality in sustainability reporting?

X05. What is the principal-agent problem?

X06. What is the "front page test"?

X07. What is ethical fading?

X08. Why is "everyone in the industry does it" a weak ethical argument?

How to write good cards

Five rules make cards fast to review and hard to fool yourself with:

1. One idea per card. A card that asks for three things is either all right or all wrong, so you cannot tell which part you know.
2. Cue recall, not recognition. "What does WACC weight?" rather than "Is WACC weighted by book values? yes or no".
3. Short answers. If the answer needs more than two sentences, split the card.
4. Use a concrete case. Tie the card to one of your own cases or to a fictional setting (Northfield Outdoor Co., Corvane Robotics, Tallow Creek Medical Center).
5. Make cards from mistakes. Every fix rule in mba/mba-error-log becomes a card.

Example A (fully worked). Bad card: "Q: Explain DCF valuation. A: (half a page)". Problems: many ideas, no cue, long answer. Rewritten as four cards:

• Q: Which cash flow is discounted at the WACC? A: Free cash flow to the firm (before interest, after tax).
• Q: Which rate discounts free cash flow to equity? A: The cost of equity.
• Q: Formula for a growing perpetuity terminal value at year $T$? A: $FCF_{T+1} / (r - g)$, with $g < r$.
• Q: How do you go from enterprise value to equity value? A: Subtract net debt (and other non-equity claims).

Example B (half worked). Bad card: "Q: Queues? A: utilisation, Little's law, variability". Rewrite into cards:

• Q: State Little's law. A: [ ].
• Q: Define utilisation. A: [ ].
• Q: [ ]? A: Variability in arrivals and service times, which grows in effect as utilisation rises.

Exercise C. Turn this error-log fix rule into one or two good cards: "Mutually exclusive projects: rank by NPV, or check the incremental IRR."

Export to Anki or another app

Most flashcard apps, including Anki, can import a plain text file with one card per line and a separator between question and answer. Copy each card as one line in the form question;answer, save the lines as a .txt file, and in Anki use File, Import, then check that the field separator is set to semicolon. Remove or replace any semicolons inside a card first. Anki shows $...$ as plain text; its built-in MathJax expects \(...\) for inline math, so rewrite formulas in that form or as plain text. Example lines:

Excel NPV convention?;=NPV(rate, CF1:CFn) discounts the first value one period, so add CF0 outside the function
Little's law?;Average inventory equals throughput rate times average flow time, L = lambda W
BATNA?;Best alternative to a negotiated agreement: what you do if this deal fails

Tracking table

Common mistakes with flashcards

Self-test questions

1. A card in box 4 is answered wrongly. Where does it go, and when will you see it next?
2. Why do the review gaps grow instead of staying the same?
3. What is wrong with the card "Q: What are the assumptions, formula and uses of the CAPM?"
4. Why should a review session mix cards from different areas?
5. Your accuracy has been 65% for a week. Name two changes to make.

My notes and next steps

New cards this week (areas): [ ]. Cards I keep missing (IDs): [ ]. Daily review time and place: [ ]. Error-log fix rules turned into cards: [ERR-NNN to card ID].

Sources and further reading

Learning research:

• Leitner, S. (1972). So lernt man lernen. Herder.
• Cepeda, N. J., Pashler, H., Vul, E., Wixted, J. T., and Rohrer, D. (2006). Distributed practice in verbal recall tasks: a review and quantitative synthesis. Psychological Bulletin, 132(3), 354–380.
• Karpicke, J. D., and Roediger, H. L. (2008). The critical importance of retrieval for learning. Science, 319(5865), 966–968.
• Kornell, N. (2009). Optimising learning using flashcards: spacing is more effective than cramming. Applied Cognitive Psychology, 23(9), 1297–1317.
• Rohrer, D., and Taylor, K. (2007). The shuffling of mathematics problems improves learning. Instructional Science, 35(6), 481–498.
• Dunlosky, J., Rawson, K. A., Marsh, E. J., Nathan, M. J., and Willingham, D. T. (2013). Improving students' learning with effective learning techniques. Psychological Science in the Public Interest, 14(1), 4–58.

Primary works behind the cards:

• Sharpe, W. F. (1964). Capital asset prices: a theory of market equilibrium under conditions of risk. Journal of Finance, 19(3), 425–442.
• Modigliani, F., and Miller, M. H. (1958). The cost of capital, corporation finance and the theory of investment. American Economic Review, 48(3), 261–297.
• Modigliani, F., and Miller, M. H. (1963). Corporate income taxes and the cost of capital: a correction. American Economic Review, 53(3), 433–443.
• Nash, J. F. (1950). Equilibrium points in n-person games. Proceedings of the National Academy of Sciences, 36(1), 48–49.
• Little, J. D. C. (1961). A proof for the queuing formula: L = λW. Operations Research, 9(3), 383–387.
• Harris, F. W. (1913). How many parts to make at once. Factory, The Magazine of Management, 10(2), 135–136, 152.
• Porter, M. E. (1979). How competitive forces shape strategy. Harvard Business Review, 57(2), 137–145.
• Porter, M. E. (1980). Competitive Strategy: Techniques for Analyzing Industries and Competitors. Free Press.
• Porter, M. E. (1985). Competitive Advantage: Creating and Sustaining Superior Performance. Free Press.
• Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120.
• Ansoff, H. I. (1957). Strategies for diversification. Harvard Business Review, 35(5), 113–124.
• Christensen, C. M. (1997). The Innovator's Dilemma. Harvard Business School Press.
• Kim, W. C., and Mauborgne, R. (2005). Blue Ocean Strategy. Harvard Business School Press.
• Brandenburger, A. M., and Stuart, H. W. (1996). Value-based business strategy. Journal of Economics and Management Strategy, 5(1), 5–24.
• Gupta, S., Lehmann, D. R., and Stuart, J. A. (2004). Valuing customers. Journal of Marketing Research, 41(1), 7–18.
• McCarthy, E. J. (1960). Basic Marketing: A Managerial Approach. Irwin.
• Tuckman, B. W. (1965). Developmental sequence in small groups. Psychological Bulletin, 63(6), 384–399.
• Edmondson, A. (1999). Psychological safety and learning behavior in work teams. Administrative Science Quarterly, 44(2), 350–383.
• Herzberg, F., Mausner, B., and Snyderman, B. B. (1959). The Motivation to Work. Wiley.
• Vroom, V. H. (1964). Work and Motivation. Wiley.
• Hackman, J. R., and Oldham, G. R. (1976). Motivation through the design of work: test of a theory. Organizational Behavior and Human Performance, 16(2), 250–279.
• Kotter, J. P. (1995). Leading change: why transformation efforts fail. Harvard Business Review, 73(2), 59–67.
• Bass, B. M. (1985). Leadership and Performance Beyond Expectations. Free Press.
• Fisher, R., and Ury, W. (1981). Getting to Yes: Negotiating Agreement Without Giving In. Houghton Mifflin.
• Raiffa, H. (1982). The Art and Science of Negotiation. Harvard University Press.
• Walton, R. E., and McKersie, R. B. (1965). A Behavioral Theory of Labor Negotiations. McGraw-Hill.
• Friedman, M. (1970, 13 September). The social responsibility of business is to increase its profits. The New York Times Magazine.
• Freeman, R. E. (1984). Strategic Management: A Stakeholder Approach. Pitman.
• Jensen, M. C., and Meckling, W. H. (1976). Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305–360.
• Tenbrunsel, A. E., and Messick, D. M. (2004). Ethical fading: the role of self-deception in unethical behavior. Social Justice Research, 17(2), 223–236.
• Further reading (by name only): Berk and DeMarzo, Corporate Finance; Kotler and Keller, Marketing Management; Cachon and Terwiesch, Matching Supply with Demand; Robbins and Judge, Organizational Behavior; OpenStax Principles of Accounting, Principles of Economics and Principles of Management (current editions CC BY-NC-SA 4.0).

Answer key

Accounting.

• A01. The income statement shows performance over a period; the balance sheet shows position at a date; the cash flow statement explains the change in cash. Net income flows into retained earnings and starts the indirect operating cash flow; ending cash on the cash flow statement equals cash on the balance sheet.
• A02. Accrual accounting records revenue when earned and expenses when incurred, whatever the timing of cash; cash accounting records only receipts and payments.
• A03. Growing receivables or inventory (working capital), heavy capital expenditure, and debt repayments or dividends larger than operating cash flow.
• A04. $300 / 200 = 1.5$ (=300/200): current assets cover short-term obligations 1.5 times; compare with the industry and the cash conversion cycle, since too high can also mean idle capital.
• A05. $60 / (730/365) = 30$ days (=60/(730/365)).
• A06. $50 + 20 - 30 = 40$: add back depreciation, subtract the increase in receivables.
• A07. Contribution margin $60 - 36 = 24$ per unit; break-even $240{,}000 / 24 = 10{,}000$ units (=240000/(60-36)), which is USD 600,000 of revenue.
• A08. It is a future cost (or revenue) that differs between the alternatives. Sunk costs and costs common to all options are irrelevant; opportunity costs are relevant.

Corporate finance.

• F01. $1{,}000 \times 1.05^{10} = 1{,}628.89$ (=FV(5%,10,0,-1000)).
• F02. NPV $= -1{,}000 + 400/1.1 + 400/1.1^2 + 400/1.1^3 = -5.26$ (=NPV(10%,400,400,400)-1000). Reject: it destroys a little value at a 10% cost of capital.
• F03. IRR $= 9.70\%$ (=IRR(B2:E2) with -1000, 400, 400, 400). It is below the 10% hurdle, which is the same signal as a negative NPV for a conventional project.
• F04. IRR ignores scale and timing differences, and can give multiple or no solutions for unconventional flows. NPV measures value created in currency; use it, or the IRR of the incremental cash flows.
• F05. $r_E = 4\% + 1.2 \times 5.5\% = 10.60\%$ (=4%+1.2*5.5%).
• F06. WACC $= 0.6 \times 10.6\% + 0.4 \times 6\% \times (1 - 0.25) = 8.16\%$.
• F07. $100 / (0.09 - 0.03) = 1{,}666.67$ (=100/(9%-3%)).
• F08. Without taxes, in perfect capital markets, firm value does not depend on the debt-equity mix (Modigliani and Miller 1958). With corporate taxes, interest is deductible, so debt adds the present value of the tax shield (Modigliani and Miller 1963); in practice this is traded off against financial distress costs.

Economics.

• E01. $-15\% / 10\% = -1.5$: demand is elastic, so revenue falls (for example $1.10 \times 0.85 = 0.935$, a 6.5% drop).
• E02. Produce where marginal revenue equals marginal cost (and price covers average variable cost).
• E03. The value of the best alternative given up. Example: a store's own building could be leased out for USD 200,000 a year; that rent forgone is a cost of using it as a store.
• E04. Perfect competition: price equals marginal cost in equilibrium. Monopoly: price exceeds marginal cost, because marginal revenue lies below the demand curve.
• E05. A set of strategies in which no player can do better by changing only their own strategy (Nash 1950).
• E06. It is a prisoner's dilemma: cutting price is each firm's best response whatever the rival does, so both cut, although both would prefer mutual high prices. Repeated interaction can sustain cooperation (within competition law).
• E07. $1.06 / 1.03 - 1 = 2.91\%$ (=1.06/1.03-1); the approximation $6\% - 3\% = 3\%$ is close.
• E08. $F = 1.10 \times 1.04 / 1.02 = 1.1216$ USD per EUR (=1.10*1.04/1.02): the higher-interest currency (USD) trades at a forward discount.

Data and decision analytics.

• D01. $0.6 \times 500 + 0.4 \times (-200) = 220$ (=SUMPRODUCT({0.6,0.4},{500,-200})).
• D02. Work from right to left: at chance nodes take the probability-weighted average, at decision nodes take the best branch, and carry the value back to the root.
• D03. $12 / \sqrt{36} = 2$ (=12/SQRT(36)).
• D04. Confounders (seasonality, price promotions) and reverse causation (budgets set from expected sales) can create the correlation. Causal claims need an experiment or a credible quasi-experimental design.
• D05. Holding price constant, each additional USD 1,000 of advertising is associated with USD 2,500 more sales on average; with observational data it is an association, not a proven causal effect.
• D06. The probability of a result at least as extreme as the one observed, if the null hypothesis were true.
• D07. The expected value with perfect information minus the best expected value without it; it is the most you should pay for any information about that uncertainty.
• D08. To measure performance on data the model has not seen, which detects overfitting.

Marketing.

• M01. Segmentation, targeting, positioning, in that order.
• M02. Target customer, frame of reference (category), point of difference (benefit), and reason to believe.
• M03. Product, price, place and promotion (McCarthy 1960).
• M04. $\text{CLV} = m \times r / (1 + d - r) = 40 \times 0.8 / 0.3 = 106.67$ (=40*0.8/(1+10%-0.8)), the infinite-horizon form used by Gupta, Lehmann and Stuart (2004) under this timing convention.
• M05. Markup on cost $20/60 = 33.3\%$; margin on price $20/80 = 25.0\%$.
• M06. Acquisition spending creates value only if the expected lifetime value of the customer exceeds what it cost to win them; the ratio guides how much to spend per channel.
• M07. Value-based pricing starts from the customer's willingness to pay and the next best alternative; cost-plus starts from unit cost and adds a markup, ignoring demand.
• M08. How customers perceive brands on two chosen attributes, revealing gaps and crowded positions. Limit: the two axes may not be the attributes that drive choice.

Operations.

• O01. Capacity is 30 per hour, set by the second step, the bottleneck.
• O02. By Little's law, $L = \lambda W = 30 \times 0.5 = 15$ patients (Little 1961).
• O03. $W = I / TH = 60 / 20 = 3$ days.
• O04. $Q^* = \sqrt{2DS/H} = \sqrt{2 \times 12{,}000 \times 50 / 3} = 632.46$ units (=SQRT(2*12000*50/3)) (Harris 1913).
• O05. $\rho = 8/10 = 80\%$. Waiting time scales with $\rho / (1 - \rho)$ in common models, which rises steeply as $\rho$ nears 1: there is little spare capacity to absorb bursts of arrivals.
• O06. To protect service levels against variability in demand and lead time during replenishment.
• O07. Variability: arrivals and service times fluctuate, so at some moments demand exceeds capacity and a queue builds that idle moments later cannot fully recover.
• O08. The width of the specification limits with the natural process spread: $C_p = (USL - LSL) / 6\sigma$.

Strategy.

• S01. Rivalry among existing competitors, threat of new entrants, bargaining power of buyers, bargaining power of suppliers, threat of substitutes. Together they explain the industry's long-run profitability (Porter 1979).
• S02. Inbound logistics, operations, outbound logistics, marketing and sales, service (Porter 1985).
• S03. Valuable, rare, imperfectly imitable and without strategically equivalent substitutes (Barney 1991); the later VRIO form adds organisation to exploit the resource.
• S04. Cost leadership, differentiation and focus (Porter 1980, Competitive Strategy).
• S05. Market penetration, product development, market development and diversification (Ansoff 1957).
• S06. It starts with a product that underperforms on the attributes mainstream customers value but serves overlooked or low-end customers, then improves until it displaces incumbents (Christensen 1997).
• S07. Eliminate, reduce, raise, create (Kim and Mauborgne 2005).
• S08. A firm has a competitive advantage when it creates more value (customer willingness to pay minus supplier opportunity cost) than its rivals (Brandenburger and Stuart 1996).

Leadership and organisational behaviour.

• L01. Forming, storming, norming, performing (Tuckman 1965); adjourning was added in a 1977 review with Jensen.
• L02. A shared belief that the team is safe for interpersonal risk-taking, such as admitting mistakes or asking for help (Edmondson 1999).
• L03. Hygiene factors (pay, policies, working conditions) prevent dissatisfaction when adequate; motivators (achievement, recognition, the work itself, responsibility) create satisfaction (Herzberg 1959).
• L04. $M = E \times I \times V$: expectancy that effort leads to performance, instrumentality that performance leads to outcomes, and the valence of those outcomes (Vroom 1964).
• L05. Skill variety, task identity, task significance, autonomy and feedback (Hackman and Oldham 1976).
• L06. Establish a sense of urgency; without it, people stay with the status quo and the coalition for change does not form (Kotter 1995).
• L07. Transactional leaders exchange rewards for performance; transformational leaders raise followers' motivation through vision, inspiration, intellectual stimulation and individual consideration (Bass 1985).
• L08. Situation, behaviour, impact, a feedback model associated with the Center for Creative Leadership.

Negotiation.

• N01. The best alternative to a negotiated agreement: what you will do if this deal fails (Fisher and Ury 1981). It sets your walk-away point.
• N02. USD 900,000 to USD 1,000,000, a zone worth USD 100,000.
• N03. A position is what a party says it wants; an interest is why it wants it. Agreements that meet interests open more options than haggling over positions.
• N04. A first offer anchors the discussion and often pulls the outcome toward it. It is risky when you know little about the other side's reservation price and might leave value on the table.
• N05. Distributive bargaining divides a fixed value; integrative bargaining increases the total value to divide (Walton and McKersie 1965).
• N06. Trading concessions across issues that the parties value differently, so each gains on what matters most to them.
• N07. An agreement in which no party can be made better off without making another worse off (Raiffa 1982 applies the idea to negotiation analysis).
• N08. When the best deal available is worth less to you than your BATNA, after checking whether you can improve the deal or your BATNA.

Ethics, ESG and governance.

• X01. Shareholder view: the firm's social responsibility is to increase profits within the rules of the game (Friedman 1970). Stakeholder theory: managers must consider all groups that affect or are affected by the firm (Freeman 1984).
• X02. Consequentialist reasoning judges an action by its outcomes; deontological reasoning by whether it respects duties and rights, whatever the outcome.
• X03. Disclose it promptly to the right person under your organisation's policy, and step back from the decision unless told otherwise in writing.
• X04. Financial materiality covers sustainability matters that affect the company's value; double materiality adds the company's impacts on people and the environment. The EU's ESRS use double materiality; the ISSB standards (IFRS S1 and S2) focus on information useful to investors. On 3 July 2026 the European Commission adopted a delegated act simplifying the ESRS, reported to keep double materiality as the basis; as of October 2026 check the published text on EUR-Lex and ifrs.org before you rely on it.
• X05. Agents (managers) may act in their own interest rather than the principals' (shareholders') because information is asymmetric and monitoring is costly (Jensen and Meckling 1976).
• X06. Ask whether you would be comfortable seeing the decision described accurately on a newspaper's front page.
• X07. The process by which the ethical dimension of a decision drops out of view, for example when it is framed only as a business or technical decision (Tenbrunsel and Messick 2004).
• X08. Widespread practice describes what is done, not what is right; it is also a common rationalisation, and industries change their norms after scandals.

Example B (How to write good cards). Little's law: average inventory equals throughput times average flow time, $L = \lambda W$. Utilisation: the share of capacity used, demand rate divided by capacity. Third card question: "What makes queues grow sharply at high utilisation?"

Exercise C (model answer). "Q: Two projects are mutually exclusive. Which measure ranks them? A: NPV at the cost of capital." and "Q: If you want to use IRR on mutually exclusive projects, what do you compute? A: The IRR of the incremental cash flows (larger minus smaller)."

Self-test.

1. Back to box 1; you see it again tomorrow.
2. Each successful recall slows forgetting, so the next review can wait longer; growing gaps keep reviews effortful but successful, which gives more retention per minute.
3. It asks for several ideas at once, so you cannot tell which part you know. Split it into one card per idea.
4. Interleaving trains you to recognise which concept a problem needs, which is what exams and cases demand, and it also spaces each area.
5. Add fewer new cards until accuracy recovers, and split or rewrite the cards you miss most (often by adding a concrete example or the formula).

Revision history

Standard and licence note

Structure aligned with the Leitner box method and the retrieval, spacing and interleaving research cited above. The 80 cards, answers and examples are original text written for this library; frameworks are attributed to their originators and summarised in our own words, and no textbook, case or exam question is reproduced. This template is not affiliated with or endorsed by any business school, publisher or accreditation body. Template licence: MIT.