Compared to Creating and Developing a Brand from Scratch, a Firm

question 91

Multiple Choice

Compared to creating and developing a brand from scratch, a firm sometimes buys a brand from another company at a premium price because outright purchase is

• A) more challenging strategically.
• B) less time consuming.
• C) less risky.
• D) less expensive.
• E) less expensive and less risky.

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Definitions:

Market-Clearing Level

Market-Clearing Level is the price point at which the quantity of goods supplied is equal to the quantity of goods demanded, eliminating any surplus or shortage in the market.

Quantity Supplied

The total amount of a good or service that producers are willing and able to sell at a given price over a specific period.

Quantity Demanded

The aggregate quantity of a product or service that buyers are prepared and capable of buying at a certain price point.

Equilibrium Price

The cost at which the amount of a product or service that consumers want to buy matches the amount that producers are willing to sell, creating a balanced market situation.