A Company Using a Narrow Scope in Its Business Strategy

question 59

Multiple Choice

A company using a narrow scope in its business strategy is:

• A) following a cost leadership business strategy.
• B) focusing on a broad array of geographic markets.
• C) limiting the group of product segments served.
• D) likely to earn only average returns.

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Definitions:

Cash-Based Measure

An accounting method that recognizes revenues and expenses only when cash is exchanged.

Cash Flow

The overall sum of funds moving into and out of a company, particularly how it impacts the availability of cash.

Average Total Assets

A measure used to evaluate a company's efficiency at using its assets by calculating the average of its total assets over a specific period.

Operating Income

The profit realized from a business's ongoing operations, calculated before interest and taxes.