A Food Chain Has a Promotion Where Each Purchaser of a Large

question 87

Multiple Choice

A food chain has a promotion where each purchaser of a large, rather than a medium-sized beverage, gets a chance to win a prize. Which of the following best describes the strategic growth opportunity that is being used?

• A) product development
• B) diversification
• C) market penetration
• D) market development

Grasp the concept of a complete portfolio and its components.

Understand how to convert Annual Percentage Rates (APR) to Effective Annual Rates (EAR).

Analyze the impact of investment timing on performance measures.

Understand the methods of forecasting risk premium and the use of the Sharpe ratio in evaluating investment performance.

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Definitions:

LRAC Curve

Stands for Long-Run Average Cost curve, which shows the lowest average cost at which a firm can produce any given level of output in the long term when all inputs are variable.

Decreasing-Cost Industry

An industry in which production costs decrease as the industry grows and output increases, often due to economies of scale.

LRAC Curve

The Long-Run Average Cost curve, showing the lowest possible cost of producing different levels of output when all inputs are variable.

Increasing-Cost Industry

An industry where production costs increase as output grows, often due to resource limitations or regulatory constraints.