General Motors' Creation of Expensive Cadillacs and More Affordable Chevrolets

question 35

Multiple Choice

General Motors' creation of expensive Cadillacs and more affordable Chevrolets was a way to compete with the Ford Motor Company by __________.

• A) organizing into separate divisions, each appealing to a different market segment
• B) simplifying all its models
• C) using only one basic color
• D) dropping the price of its cars

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Definitions:

Premium

The amount by which the price of a financial instrument or insurance policy exceeds its face value or the cost above the normal price.

Modified Duration

A measure indicating the sensitivity of a bond's price to changes in interest rates, estimating the percentage price change for a parallel shift in yield curves.

Yield

The income return on an investment, such as the interest or dividends received, expressed as an annual percentage of the investment's cost.