Which of the Following Statements Is True

question 14

Multiple Choice

Which of the following statements is true?

• A)The average profiles for profitable high-share and profitable low-share businesses are almost identical.
• B)A low-share business with above-average customer value is more profitable than a high-share business with below-average customer value.
• C)A low-share niche business's prices are slightly above the average relative price index of 100.
• D)Profitable low-share niche businesses tend to have a wide product breadth.
• E)Profitable low-share niche businesses tend to spend more on advertising relative to the competition.

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Definitions:

Bowed Outward

Refers to the shape of the production possibility frontier that demonstrates increasing opportunity costs as resources are reallocated from producing one good to another.

Tennis Rackets

Sporting equipment consisting of a handled frame with a open hoop where a network of strings is stretched tightly.

Production Of Socks

The manufacturing process of creating socks, involving various steps from the sourcing of materials to the final product packaging.

Production Possibilities Frontier

A graphical representation showing the maximum combinations of goods and/or services that can be produced with a fixed set of resources.