Which of These Statements Regarding Service Branding Is Most Accurate

question 202

Multiple Choice

Which of these statements regarding service branding is most accurate?

• A) Unlike products, services do not use subbranding.
• B) Service providers must include the word service in their brand names to assure that customers are not purchasing a tangible product.
• C) Service firms with a well-established brand reputation will find it easier to introduce new services than those without a brand reputation.
• D) Many consumers are suspicious of service providers that offer too many service line extensions.
• E) Many service organizations, such as banks, hotels, and restaurants, do not rely heavily on branding because of the extent to which they are people-, not equipment-based services.

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Definitions:

Market Value

Today's market rate for the purchase or sale of services or assets.

Flotation Cost

Costs a company faces when it issues new securities, encompassing fees for underwriting, legal services, registration, and printing.

WACC

A measurement called the Weighted Average Cost of Capital assesses the cost of a business's capital, where every capital category is assigned a proportional weight.

Capital Structure

The particular combination of debt and equity that a company uses to finance its overall operations and growth.