The Risks of a Focus Strategy Include

question 113

Multiple Choice

The risks of a focus strategy include:

• A) a competitor's ability to use its core competencies to out-focus the focuser by serving an even more narrowly defined segment.
• B) a competitor's ability to use its core competencies to out-focus the focuser by serving an even more broadly defined segment.
• C) decisions by industry-wide competitors to use their resources to serve a wider range of customers' needs than the focuser has been serving.
• D) decisions by focused competitors to use their resources to serve a wider range of customers' needs.

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Definitions:

Realized Losses

Losses that occur when an asset is sold for less than its purchase price, thereby converting a theoretical loss into an actual loss.

Aversion

A strong dislike or disinclination towards something, often used in economics in the context of risk aversion.

Overconfidence

The bias in which someone's subjective confidence in their judgements is greater than their objective accuracy.

Framing Effect

A cognitive bias where people react differently to a particular choice depending on how it is presented.