The Reason Why the Body Shop Has No Outlets in Mainland

question 49

Multiple Choice

The reason why the Body Shop has no outlets in mainland China is because _____.

• A)the large degree of counterfeiting of cosmetics in China
• B)cosmetics must be tested on animals in China to get the license to sell them
• C)high import duties and taxes for cosmetics
• D)high competition in the sustainable cosmetics segment in China
• E)discouraging market research findings on Chinese receptivity for ethical cosmetics brands

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Definitions:

Security Market Line

A graphical representation that shows the expected rate of return of an asset as a function of its systematic risk.

Inherent Risk

The possibility of inaccurate financial statements due to factors other than failure of control, covering areas such as industry characteristics and overall economic environment.

SML

The Security Market Line, a graphical representation of the Capital Asset Pricing Model showing the relationship between the expected return of a security and its beta (systematic risk).

Required Returns

The minimum expected return on an investment, determined by the investor's risk tolerance and the investment's risk level.