In a Declining Industry

question 93

Multiple Choice

In a declining industry

• A) product-differentiation efforts are focused on product refinement as a basis of product differentiation.
• B) firms that are first movers can gain product-differentiation advantages based on perceived technological leadership.
• C) highly differentiated firms may be able to gain product-differentiation advantages by preempting strategically valuable assets.
• D) highly differentiated firms may be able to discover a viable market niche that will enable them to survive despite the overall decline in the market.

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Definitions:

Stockholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities, representing ownership equity spread among shareholders.

Retained Earnings

The amount of net income left over for the business after it has paid out dividends to its shareholders.

Price-earnings Ratio

A valuation metric for a company, calculated by dividing the market price per share by the earnings per share.

Net Income

The amount of profit left over after all expenses, taxes, and costs have been subtracted from total revenue.