The Following Problem Requires the Data Shown Below for a Large

question 7

Multiple Choice

The following problem requires the data shown below for a large firm (Pfizer) and a smaller firm (Immunogen) in the Chemicals & Allied Products industry:
$\begin{array}{lrrrrrrrrr}&\text {No. }&&&&&&&\text { Values}&\text {(\$mn.) }\\&\text { Bus.}&\text { ..Values}&\text { (s mn.) }&\text {at } \mathrm{Y-E}-&\text { 1999.. }&\text { 1999 Values}&(\$ \text { mn.) }&\text { at Year-End }& 2000\\\text { Company }&\text {Seg.}&\text { PP\&E }&\text {TA}&\text { Debt}&\text { BEQ}&\text { Sales}&\text { Net.Inc. }&\text {BEQ}&\text { MEQ }\\\hline \text { PFIZER } & 3 & 5,343 & 20,574 & 5,526 & 8,887 & 29,574 & 3,718 & 16,076 & 290,216 \\\text { IMMUNOGEN } & 1 & 158 & 7,17 & 0.07 & 5.3 & 11.18 & -0.24 & 154 & 822.3\end{array}$
-Which of the following factors most likely explains the difference in the profitabilities of these two firms?

• A)differential ability to secure debt financing
• B)differential economies of scale
• C)the difference in the number of business segments

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Definitions:

DRO Schedule

Differential Reinforcement of Other behavior, a procedure that reinforces an organism for displaying any behavior other than a target behavior.

Frustration Theory

A psychological theory suggesting that frustration, resulting from blocked goals, can lead to aggressive behavior.

Sequential Theory

A theory suggesting that understanding and behavior result from sequences of stimuli and responses, often emphasizing the importance of order in learning processes.

Extinction Contrast Effect

The phenomenon wherein the cessation of a previously reinforced behavior is accelerated when an alternative behavior continues to be reinforced.