Which of the Following Is NOT a Disadvantage of the Wait-

question 14

Multiple Choice

Which of the following is NOT a disadvantage of the wait- and- see strategy?

• A) being unable to respond if demand is unexpectedly high
• B) can erode market share over the long run
• C) can be preempted by a competitor
• D) increased risk of over expansion

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Definitions:

Jensen Measure

A performance metric that calculates the excess return of a portfolio over the predicted return by the Capital Asset Pricing Model (CAPM).

Risk-Free Return

The return on an investment with no risk of financial loss, typically associated with government bonds.

Treynor Measure

A performance metric on investment funds that accounts for the risk taken by the investment relative to the market risk as measured by beta.

Risk-Free Return

The theoretical rate of return of an investment with zero risk of financial loss.