• Journal of Global Scholars of Marketing Science
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• v.17 no.3
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• pp.1-19
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• 2007

1. Purpose Rural tourism is made by individuals with different characteristics, needs and wants. It is important to have information on the characteristics and preferences of the consumers of the different types of existing rural accommodation. The stud aims to identify the determinants of consumer preference by type of accommodations. 2. Methodology 2.1 Sample Data were collected from 1000 people by telephone survey with three-stage stratified random sampling in seven metropolitan areas in Korea. Respondents were chosen by sampling internal on telephone book published in 2006. We surveyed from four to ten-thirty 0'clock afternoon so as to systematic sampling considering respondents' life cycle. 2.2 Two-step cluster Analysis Our study is accomplished through the use of a two-step cluster method to classify the accommodation in a reduced number of groups, so that each group constitutes a type. This method had been suggested as appropriate in clustering large data sets with mixed attributes. The method is based on a distance measure that enables data with both continuous and categorical attributes to be clustered. This is derived from a probabilistic model in which the distance between two clusters in equivalent to the decrease in log-likelihood function as a result of merging. 2.3 Multinomial Logit Analysis The estimation of a Multionmial Logit model determines the characteristics of tourist who is most likely to opt for each type of accommodation. The Multinomial Logit model constitutes an appropriate framework to explore and explain choice process where the choice set consists of more than two alternatives. Due to its ease and quick estimation of parameters, the Multinomial Logit model has been used for many empirical studies of choice in tourism. 3. Findings The auto-clustering algorithm indicated that a five-cluster solution was the best model, because it minimized the BIC value and the change in them between adjacent numbers of clusters. The accommodation establishments can be classified into five types: Traditional House, Typical Farmhouse, Farmstay house for group Tour, Log Cabin for Family, and Log Cabin for Individuals. Group 1 (Traditional House) includes mainly the large accommodation establishments, i.e. those with ondoll style room providing meals and one shower room on family tourist, of original construction style house. Group 2 (Typical Farmhouse) encompasses accommodation establishments of Ondoll rooms and each bathroom providing meals. It includes, in other words, the tourist accommodations Known as "rural houses." Group 3 (Farmstay House for Group) has accommodation establishments of Ondoll rooms not providing meals and self cooking facilities, large room size over five persons. Group 4 (Log Cabin for Family) includes mainly the popular accommodation establishments, i.e. those with Ondoll style room with on shower room on family tourist, of western styled log house. While the accommodations in this group are not defined as regards type of construction, the group does include all the original Korean style construction, Finally, group 5 (Log Cabin for Individuals)includes those accommodations that are bedroom western styled wooden house with each bathroom. First Multinomial Logit model is estimated including all the explicative variables considered and taking accommodation group 2 as base alternative. The results show that the variables and the estimated values of the parameters for the model giving the probability of each of the five different types of accommodation available in rural tourism village in Korea, according to the socio-economic and trip related characteristics of the individuals. An initial observation of the analysis reveals that none of variables income, the number of journey, distance, and residential style of house is explicative in the choice of rural accommodation. The age and accompany variables are significant for accommodation establishment of group 1. The education and rural residential experience variables are significant for accommodation establishment of groups 4 and 5. The expenditure and marital status variables are significant for accommodation establishment of group 4. The gender and occupation variable are significant for accommodation establishment of group 3. The loyalty variable is significant for accommodation establishment of groups 3 and 4. The study indicates that significant differences exist among the individuals who choose each type of accommodation at a destination. From this investigation is evident that several profiles of tourists can be attracted by a rural destination according to the types of existing accommodations at this destination. Besides, the tourist profiles may be used as the basis for investment policy and promotion for each type of accommodation, making use in each case of the variables that indicate a greater likelihood of influencing the tourist choice of accommodation.

• Korean Journal of Food Science and Technology
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• v.37 no.3
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• pp.484-491
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• 2005

Quantitative microbial risk assessment (QMRA) analyzes potential hazard of microorganisms on public health and offers structured approach to assess risks associated with microorganisms in foods. This paper addresses specific risk management questions associated with Staphylococcus aureus in kimbab and improvement and dissemination of QMRA methodology, QMRA model was developed by constructing four nodes from retail to table pathway. Predictive microbial growth model and survey data were combined with probabilistic modeling to simulate levels of S. aureus in kimbab at time of consumption, Due to lack of dose-response models, final level of S. aureus in kimbeb was used as proxy for potential hazard level, based on which possibility of contamination over this level and consumption level of S. aureus through kimbab were estimated as 30.7% and 3.67 log cfu/g, respectively. Regression sensitivity results showed time-temperature during storage at selling was the most significant factor. These results suggested temperature control under $10^{\circ}C$ was critical control point for kimbab production to prevent growth of S. aureus and showed QMRA was useful for evaluation of factors influencing potential risk and could be applied directly to risk management.

• Journal of Educational Research in Mathematics
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• v.21 no.4
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• pp.327-344
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• 2011

This study is the first step for us toward improving high school students' capability of statistical inferences, such as obtaining and interpreting the confidence interval on the population mean that is currently learned in high school. We suggest 5 underlying concepts of 'discretion of contingency and inevitability', 'discretion of induction and deduction', 'likelihood principle', 'variability of a statistic' and 'statistical model', those are necessary to appreciate statistical inferences as a reliable arguing tools in spite of its occasional erroneous conclusions. We assume those 5 concepts above are to be gradually developing in their school periods and Korean mathematics textbooks of grades 1-12 were analyzed. Followings were found. For the right choice of solving methodology of the given problem, no elementary textbook but a few high school textbooks describe its difference between the contingent circumstance and the inevitable one. Formal definitions of population and sample are not introduced until high school grades, so that the developments of critical thoughts on the reliability of inductive reasoning could not be observed. On the contrary of it, strong emphasis lies on the calculation stuff of the sample data without any inference on the population prospective based upon the sample. Instead of the representative properties of a random sample, more emphasis lies on how to get a random sample. As a result of it, the fact that 'the random variability of the value of a statistic which is calculated from the sample ought to be inherited from the randomness of the sample' could neither be noticed nor be explained as well. No comparative descriptions on the statistical inferences against the mathematical(deductive) reasoning were found. Few explanations on the likelihood principle and its probabilistic applications in accordance with students' cognitive developmental growth were found. It was hard to find the explanation of a random variability of statistics and on the existence of its sampling distribution. It is worthwhile to explain it because, nevertheless obtaining the sampling distribution of a particular statistic, like a sample mean, is a very difficult job, mere noticing its existence may cause a drastic change of understanding in a statistical inference.

• Proceedings of the Korean Institute Of Construction Engineering and Management
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• 2007.11a
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• pp.396-400
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• 2007

Various ways of automated guideway transit construction are being planned recently owing to the policies of the national government and local municipalities as well as increasing investment from the private sector. Particularly, the increase in the private investment is increasing greatly in SOC (Social Overhead Cost). This trend of promoting private sector investment must be conducted on the basis of a thorough analysis of the economic feasibility of the project from the government and construction companies in the private sector. In other words, an accurate cost analysis of initial investment cost (Construction cost), maintenance/repair cost, profit making through the operation of the concerned facilities, cost of dissolution, etc. in terms of the life cycle is very much in need. Nevertheless, the analysis of uncertainty factors and its probabilistic theory are in need of development so that they can be used in the analysis of the economic feasibility of a construction project. First of all, the actual studies on maintenance/repair cost of automated guideway transit are scarce as of yet, prohibiting an accurate computation of the cost and its economic analysis. Accordingly, this study focused on the uncertainty analysis of the economic feasibility for civil engineering structures among automated guideway transit construction projects based on the rapidly increasing investment on such structures from the private sector. For this research purpose, a cost classification system for the automated guideway transit is proposed, first of all, and the data On the cost cycle of the civil structure facilities and their unit cost are collected and analyzed. Then, the uncertainty in the cost is analyzed from the perspective of LCC. In consideration of the current status with almost no. studies on maintenance/repair of such facilities, it is expected that the cost classification system and the uncertainty analysis technique proposed in this study will greatly enhance LCC analysis and economic feasibility studies for automated guideway transit projects in the future.

• Journal of Korean Society of Transportation
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• v.24 no.5 s.91
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• pp.35-44
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• 2006

Acceleration and deceleration curves have been used for design purposes worldwide. The curve in design level has been regarded as an single deterministic curve to be used for design of climb lanes. It should be noted that the curve was originally made using ideal driving truck and that the curve is applied during design based on the assumption of no difference between ideal and real driving conditions. However. observations show that aged vehicles and lazy behavioring drivers nay make lower performance of vehicles than the ideal performance. The present paper provides the results of truck speeds at climbing lanes then probabilistic variation of acceleration and deceleration corves. For these purposes. a study about identification of vehicle makers, and weights for trucks at freeway toll gates and then observation of vehicle-following speed were performed. The 85%ile results obtained were compared with the deterministic performance curves of 180, 200, and 220 Ib/hp. It was identified that the performance of 85%ile results obtained from vehicle-following-speed observations were lower than one from deterministic performance curves. From these results, it may be concluded that at the beginning Point of climbing lanes additional $16.19{\sim}67.94m$ is necessary and that at the end point of climbing lanes $53.12{\sim}103.24m$ of extension is necessary.

• Korean Journal of Agricultural and Forest Meteorology
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• v.21 no.1
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• pp.55-64
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• 2019

The flowering seasons can be advanced due to climate change that would cause an abnormally warm winter. Such warm winter would increase the frequency of crop damages resulted from sudden occurrences of low temperature before and after the vegetative growth stages, e.g., the period from germination to flowering. The degree and pattern of freezing damage would differ by the development stage of each individual fruit tree even in an orchard. A critical temperature, e.g., killing temperature, has been used to predict freeze damage by low-temperature conditions under the assumption that such damage would be associated with the development stage of a fruit flower bud. However, it would be challenging to apply the critical temperature to a region where spatial variation in temperature would be considerably high. In the present study, a phenological model was used to estimate major bud development stages, which would be useful for prediction of regional risks for the freeze damages. We also derived a linear function to calculate a probabilistic freeze risk in spring, which can quantitatively evaluate the risk level based solely on forecasted weather data. We calculated the dates of freeze damage occurrences and spatial risk distribution according to main production areas by applying the spring freeze risk function to apple, peach, and pear crops in 2018. It was predicted that the most extensive low-temperature associated freeze damage could have occurred on April 8. It was also found that the risk function was useful to identify the main production areas where the greatest damage to a given crop could occur. These results suggest that the freezing damage associated with the occurrence of low-temperature events could decrease providing early warning for growers to respond abnormal weather conditions for their farm.

• Asia Marketing Journal
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• v.14 no.2
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• pp.157-176
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• 2012

Brand switching data frequently used in market structure analysis is adequate to analyze non- durable goods, because it can capture competition between specific two brands. But brand switching data sometimes can not be used to analyze goods like automobiles having long term duration because one of main assumptions that consumer preference toward brand attributes is not changed against time can be violated. Therefore a new type of data which can precisely capture competition among durable goods is needed. Another problem of using brand switching data collected from actual purchase behavior is short of explanation why consumers consider different set of brands. Considering above problems, main purpose of this study is to analyze market structure for durable goods with consideration set. The author uses exploratory approach and latent class clustering to identify market structure based on heterogeneous consideration set among consumers. Then the relationship between some factors and consideration set formation is analyzed. Some benefits and two demographic variables - age and income - are selected as factors based on consumer behavior theory. The author analyzed USA automotive market with top 11 brands using exploratory approach and latent class clustering. 2,500 respondents are randomly selected from the total sample and used for analysis. Six models concerning market structure are established to test. Model 1 means non-structured market and model 6 means market structure composed of six sub-markets. It is exploratory approach because any hypothetical market structure is not defined. The result showed that model 1 is insufficient to fit data. It implies that USA automotive market is a structured market. Model 3 with three market structures is significant and identified as the optimal market structure in USA automotive market. Three sub markets are named as USA brands, Asian Brands, and European Brands. And it implies that country of origin effect may exist in USA automotive market. Comparison between modal classification by derived market structures and probabilistic classification by research model was conducted to test how model 3 can correctly classify respondents. The model classify 97% of respondents exactly. The result of this study is different from those of previous research. Previous research used confirmatory approach. Car type and price were chosen as criteria for market structuring and car type-price structure was revealed as the optimal structure for USA automotive market. But this research used exploratory approach without hypothetical market structures. It is not concluded yet which approach is superior. For confirmatory approach, hypothetical market structures should be established exhaustively, because the optimal market structure is selected among hypothetical structures. On the other hand, exploratory approach has a potential problem that validity for derived optimal market structure is somewhat difficult to verify. There also exist market boundary difference between this research and previous research. While previous research analyzed seven car brands, this research analyzed eleven car brands. Both researches seemed to represent entire car market, because cumulative market shares for analyzed brands exceeds 50%. But market boundary difference might affect the different results. Though both researches showed different results, it is obvious that country of origin effect among brands should be considered as important criteria to analyze USA automotive market structure. This research tried to explain heterogeneity of consideration sets among consumers using benefits and two demographic factors, sex and income. Benefit works as a key variable for consumer decision process, and also works as an important criterion in market segmentation. Three factors - trust/safety, image/fun to drive, and economy - are identified among nine benefit related measure. Then the relationship between market structures and independent variables is analyzed using multinomial regression. Independent variables are three benefit factors and two demographic factors. The result showed that all independent variables can be used to explain why there exist different market structures in USA automotive market. For example, a male consumer who perceives all benefits important and has lower income tends to consider domestic brands more than European brands. And the result also showed benefits, sex, and income have an effect to consideration set formation. Though it is generally perceived that a consumer who has higher income is likely to purchase a high priced car, it is notable that American consumers perceived benefits of domestic brands much positive regardless of income. Male consumers especially showed higher loyalty for domestic brands. Managerial implications of this research are as follow. Though implication may be confined to the USA automotive market, the effect of sex on automotive buying behavior should be analyzed. The automotive market is traditionally conceived as male consumers oriented market. But the proportion of female consumers has grown over the years in the automotive market. It is natural outcome that Volvo and Hyundai motors recently developed new cars which are targeted for women market. Secondly, the model used in this research can be applied easier than that of previous researches. Exploratory approach has many advantages except difficulty to apply for practice, because it tends to accompany with complicated model and to require various types of data. The data needed for the model in this research are a few items such as purchased brands, consideration set, some benefits, and some demographic factors and easy to collect from consumers.

• Journal of Intelligence and Information Systems
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• v.19 no.3
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• pp.1-23
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• 2013

To discover significant social issues such as unemployment, economy crisis, social welfare etc. that are urgent issues to be solved in a modern society, in the existing approach, researchers usually collect opinions from professional experts and scholars through either online or offline surveys. However, such a method does not seem to be effective from time to time. As usual, due to the problem of expense, a large number of survey replies are seldom gathered. In some cases, it is also hard to find out professional persons dealing with specific social issues. Thus, the sample set is often small and may have some bias. Furthermore, regarding a social issue, several experts may make totally different conclusions because each expert has his subjective point of view and different background. In this case, it is considerably hard to figure out what current social issues are and which social issues are really important. To surmount the shortcomings of the current approach, in this paper, we develop a prototype system that semi-automatically detects social issue keywords representing social issues and problems from about 1.3 million news articles issued by about 10 major domestic presses in Korea from June 2009 until July 2012. Our proposed system consists of (1) collecting and extracting texts from the collected news articles, (2) identifying only news articles related to social issues, (3) analyzing the lexical items of Korean sentences, (4) finding a set of topics regarding social keywords over time based on probabilistic topic modeling, (5) matching relevant paragraphs to a given topic, and (6) visualizing social keywords for easy understanding. In particular, we propose a novel matching algorithm relying on generative models. The goal of our proposed matching algorithm is to best match paragraphs to each topic. Technically, using a topic model such as Latent Dirichlet Allocation (LDA), we can obtain a set of topics, each of which has relevant terms and their probability values. In our problem, given a set of text documents (e.g., news articles), LDA shows a set of topic clusters, and then each topic cluster is labeled by human annotators, where each topic label stands for a social keyword. For example, suppose there is a topic (e.g., Topic1 = {(unemployment, 0.4), (layoff, 0.3), (business, 0.3)}) and then a human annotator labels "Unemployment Problem" on Topic1. In this example, it is non-trivial to understand what happened to the unemployment problem in our society. In other words, taking a look at only social keywords, we have no idea of the detailed events occurring in our society. To tackle this matter, we develop the matching algorithm that computes the probability value of a paragraph given a topic, relying on (i) topic terms and (ii) their probability values. For instance, given a set of text documents, we segment each text document to paragraphs. In the meantime, using LDA, we can extract a set of topics from the text documents. Based on our matching process, each paragraph is assigned to a topic, indicating that the paragraph best matches the topic. Finally, each topic has several best matched paragraphs. Furthermore, assuming there are a topic (e.g., Unemployment Problem) and the best matched paragraph (e.g., Up to 300 workers lost their jobs in XXX company at Seoul). In this case, we can grasp the detailed information of the social keyword such as "300 workers", "unemployment", "XXX company", and "Seoul". In addition, our system visualizes social keywords over time. Therefore, through our matching process and keyword visualization, most researchers will be able to detect social issues easily and quickly. Through this prototype system, we have detected various social issues appearing in our society and also showed effectiveness of our proposed methods according to our experimental results. Note that you can also use our proof-of-concept system in http://dslab.snu.ac.kr/demo.html.

• Journal of Global Scholars of Marketing Science
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• v.19 no.4
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• pp.11-23
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• 2009

HSDPA (High-Speed Downlink Packet Access) is a 3.5-generation asynchronous mobile communications service based on the third generation of W-CDMA. In Korea, it is mainly provided in through videophone service. Because of the diffusion of more powerful and diversified services, along with steep advances in mobile communications technology, consumers demand a wide range of choices. However, because of the variety of technologies, which tend to overflow the market regardless of consumer preferences, consumers feel increasingly confused. Therefore, we should not adopt strategies that focus only on developing new technology on the assumption that new technologies are next-generation projects. Instead, we should understand the process by which consumers accept new forms of technology and devise schemes to lower market entry barriers through strategies that enable developers to understand and provide what consumers really want. In the Technology Acceptance Model (TAM), perceived usefulness and perceived ease of use are suggested as the most important factors affecting the attitudes of people adopting new technologies (Davis, 1989; Taylor and Todd, 1995; Venkatesh, 2000; Lee et al., 2004). Perceived usefulness is the degree to which a person believes that a particular technology will enhance his or her job performance. Perceived ease of use is the degree of subjective belief that using a particular technology will require little physical and mental effort (Davis, 1989; Morris and Dillon, 1997; Venkatesh, 2000). Perceived pleasure and perceived usefulness have been shown to clearly affect attitudes toward accepting technology (Davis et al., 1992). For example, pleasure in online shopping has been shown to positively impact consumers' attitudes toward online sellers (Eighmey and McCord, 1998; Mathwick, 2002; Jarvenpaa and Todd, 1997). The perceived risk of customers is a subjective risk, which is distinguished from an objective probabilistic risk. Perceived risk includes a psychological risk that consumers perceive when they choose brands, stores, and methods of purchase to obtain a particular item. The ability of an enterprise to revolutionize products depends on the effective acquisition of knowledge about new products (Bierly and Chakrabarti, 1996; Rothwell and Dodgson, 1991). Knowledge acquisition is the ability of a company to perceive the value of novelty and technology of the outside (Cohen and Levinthal, 1990), to evaluate the outside technology that has newly appeared (Arora and Gambaradella, 1994), and to predict the future evolution of technology accurately (Cohen and Levinthal, 1990). Consumer innovativeness is the degree to which an individual adopts innovation earlier than others in the social system (Lee, Ahn, and Ha, 2001; Gatignon and Robertson, 1985). That is, it shows how fast and how easily consumers adopt new ideas. Innovativeness is regarded as important because it has a significant effect on whether consumers adopt new products and on how fast they accept new products (Midgley and Dowling, 1978; Foxall, 1988; Hirschman, 1980). We conducted cross-national comparative research using the TAM model, which empirically verified the relationship between the factors that affect attitudes - perceived usefulness, ease of use, perceived pleasure, perceived risk, innovativeness, and perceived level of knowledge management - and attitudes toward HSDPA service. We also verified the relationship between attitudes and usage intention for the purpose of developing more effective methods of management for HSDPA service providers. For this research, 346 questionnaires were distributed among 350 students in the Republic of Korea. Because 26 of the returned questionnaires were inconsistent or had missing data, 320 questionnaires were used in the hypothesis tests. In UK, 192 of the total 200 questionnaires were retrieved, and two incomplete ones were discarded, bringing the total to 190 questionnaires used for statistical analysis. The results of the overall model analysis are as follows: Republic of Korea x2=333.27(p=0.0), NFI=0.88, NNFI=0.88, CFI=0.91, IFI=0.91, RMR=0.054, GFI=0.90, AGFI=0.84, UK x2=176.57(p=0.0), NFI=0.88, NNFI=0.90, CFI=0.93, IFI=0.93, RMR=0.062, GFI=0.90, AGFI=0.84. From the results of the hypothesis tests of Korean consumers about the relationship between factors that affect intention to use HSDPA services and attitudes, we can conclude that perceived usefulness, ease of use, pleasure, a high level of knowledge management, and innovativeness promote positive attitudes toward HSDPA mobile phones. However, ease of use and perceived pleasure did not have a direct effect on intention to use HSDPA service. This may have resulted from the fact that the use of video phones is not necessary for everyday life yet. Moreover, it has been shown that attitudes toward HSDPA video phones are directly correlated with usage intention, which means that perceived usefulness, ease of use, pleasure, a high level of knowledge management, and innovativeness. These relationships form the basis of the intention to buy, contributing to a situation in which consumers decide to choose carefully. A summary of the results of the hypothesis tests of European consumers revealed that perceived usefulness, pleasure, risk, and the level of knowledge management are factors that affect the formation of attitudes, while ease of use and innovativeness do not have an effect on attitudes. In particular, with regard to the effect value, perceived usefulness has the largest effect on attitudes, followed by pleasure and knowledge management. On the contrary, perceived risk has a smaller effect on attitudes. In the Asian model, ease of use and perceived pleasure were found not to have a direct effect on intention to use. However, because attitudes generally affect the intention to use, perceived usefulness, pleasure, risk, and knowledge management may be considered key factors in attitude development from which usage intention arises. In conclusion, perceived usefulness, pleasure, and the level of knowledge management have an effect on attitude formation in both Asian and European consumers, and such attitudes shape these consumers' intention to use. Furthermore, the hypotheses that ease of use and perceived pleasure affect usage intention are rejected. However, ease of use, perceived risk, and innovativeness showed different results. Perceived risk had no effect on attitude formation among Asians, while ease of use and innovativeness had no effect on attitudes among Europeans.

• Asia Marketing Journal
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• v.14 no.1
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• pp.83-98
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• 2012

In a market where new and used cars are competing with each other, we would run the risk of obtaining biased estimates of cross elasticity between them if we focus on only new cars or on only used cars. Unfortunately, most of previous studies on the automobile industry have focused on only new car models without taking into account the effect of used cars' pricing policy on new cars' market shares and vice versa, resulting in inadequate prediction of reactive pricing in response to competitors' rebate or price discount. However, there are some exceptions. Purohit (1992) and Sullivan (1990) looked into both new and used car markets at the same time to examine the effect of new car model launching on the used car prices. But their studies have some limitations in that they employed the average used car prices reported in NADA Used Car Guide instead of actual transaction prices. Some of the conflicting results may be due to this problem in the data. Park (1998) recognized this problem and used the actual prices in his study. His work is notable in that he investigated the qualitative effect of new car model launching on the pricing policy of the used car in terms of reinforcement of brand equity. The current work also used the actual price like Park (1998) but the quantitative aspect of competitive price promotion between new and used cars of the same model was explored. In this study, I develop a model that assumes that the cross elasticity between new and used cars of the same model is higher than those amongst new cars and used cars of the different model. Specifically, I apply the nested logit model that assumes the car model choice at the first stage and the choice between new and used cars at the second stage. This proposed model is compared to the IIA (Independence of Irrelevant Alternatives) model that assumes that there is no decision hierarchy but that new and used cars of the different model are all substitutable at the first stage. The data for this study are drawn from Power Information Network (PIN), an affiliate of J.D. Power and Associates. PIN collects sales transaction data from a sample of dealerships in the major metropolitan areas in the U.S. These are retail transactions, i.e., sales or leases to final consumers, excluding fleet sales and including both new car and used car sales. Each observation in the PIN database contains the transaction date, the manufacturer, model year, make, model, trim and other car information, the transaction price, consumer rebates, the interest rate, term, amount financed (when the vehicle is financed or leased), etc. I used data for the compact cars sold during the period January 2009- June 2009. The new and used cars of the top nine selling models are included in the study: Mazda 3, Honda Civic, Chevrolet Cobalt, Toyota Corolla, Hyundai Elantra, Ford Focus, Volkswagen Jetta, Nissan Sentra, and Kia Spectra. These models in the study accounted for 87% of category unit sales. Empirical application of the nested logit model showed that the proposed model outperformed the IIA (Independence of Irrelevant Alternatives) model in both calibration and holdout samples. The other comparison model that assumes choice between new and used cars at the first stage and car model choice at the second stage turned out to be mis-specfied since the dissimilarity parameter (i.e., inclusive or categroy value parameter) was estimated to be greater than 1. Post hoc analysis based on estimated parameters was conducted employing the modified Lanczo's iterative method. This method is intuitively appealing. For example, suppose a new car offers a certain amount of rebate and gains market share at first. In response to this rebate, a used car of the same model keeps decreasing price until it regains the lost market share to maintain the status quo. The new car settle down to a lowered market share due to the used car's reaction. The method enables us to find the amount of price discount to main the status quo and equilibrium market shares of the new and used cars. In the first simulation, I used Jetta as a focal brand to see how its new and used cars set prices, rebates or APR interactively assuming that reactive cars respond to price promotion to maintain the status quo. The simulation results showed that the IIA model underestimates cross elasticities, resulting in suggesting less aggressive used car price discount in response to new cars' rebate than the proposed nested logit model. In the second simulation, I used Elantra to reconfirm the result for Jetta and came to the same conclusion. In the third simulation, I had Corolla offer $1,000 rebate to see what could be the best response for Elantra's new and used cars. Interestingly, Elantra's used car could maintain the status quo by offering lower price discount ($160) than the new car ($205). In the future research, we might want to explore the plausibility of the alternative nested logit model. For example, the NUB model that assumes choice between new and used cars at the first stage and brand choice at the second stage could be a possibility even though it was rejected in the current study because of mis-specification (A dissimilarity parameter turned out to be higher than 1). The NUB model may have been rejected due to true mis-specification or data structure transmitted from a typical car dealership. In a typical car dealership, both new and used cars of the same model are displayed. Because of this fact, the BNU model that assumes brand choice at the first stage and choice between new and used cars at the second stage may have been favored in the current study since customers first choose a dealership (brand) then choose between new and used cars given this market environment. However, suppose there are dealerships that carry both new and used cars of various models, then the NUB model might fit the data as well as the BNU model. Which model is a better description of the data is an empirical question. In addition, it would be interesting to test a probabilistic mixture model of the BNU and NUB on a new data set.