To Maintain Performance, a Small Business Must Launch a New

question 18

Multiple Choice

To maintain performance, a small business must launch a new competitive advantage

• A) and keep that competitive advantage alive.
• B) and make adjustments to that competitive advantage over time.
• C) that causes rival firms to respond.
• D) before the current strategy has run its course.

Realize the importance of knowledge management and intellectual capital in leveraging organizational performance.

Understand and calculate the payback period for investment projects.

Identify and evaluate the profitability index and internal rate of return as investment appraisal methods.

Analyze the implications of ignoring salvage value in capital budgeting decisions.

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Definitions:

Seasonal Demand

Fluctuations in the market demand for certain products or services that occur at specific times of the year.

Yield Management Pricing

A pricing strategy that adjusts prices based on changes in supply and demand, commonly used in the airline and hotel industries.

Skimming Pricing

A pricing strategy where a product is initially sold at a high price to target customers who are less price-sensitive, before gradually lowering the price.

Prestige Pricing

A pricing strategy where prices are set higher than average to project exclusivity, quality, or luxury, appealing to consumers' status and prestige.