A Disadvantage of Pursuing a Low-Cost Strategy Is That

question 9

Multiple Choice

A disadvantage of pursuing a low-cost strategy is that:

• A) it makes it difficult for the firm to customize its product offerings.
• B) price wars make it hard to compete with differentiators.
• C) it makes it easier for rivals to enter the firm's market.
• D) it makes it difficult to respond to demands from deep price discounts from powerful buyers and still make money.
• E) it makes it difficult to absorb cost increases that may be passed on downstream by powerful suppliers.

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Definitions:

Foreign Market

A market outside of a company's home country where it engages in selling its products or services.

Direct Ownership

A form of business ownership where individuals or entities have complete control over their investments or assets without intermediaries.

Foreign Market

Refers to markets outside the company's home country where it can sell or market its products or services.

Exporting

The process of exporting products or services to a foreign country for the purpose of selling them.