Ariel Owns a Company That Markets High-Quality Office Supplies to Businesses

question 305

Multiple Choice

Ariel owns a company that markets high-quality office supplies to businesses. She faces stiff competition from larger firms like Staples. Which of the following competitive strategies would probably work best for Ariel?

• A) Keep costs as low as possible by offering a no-frills approach with little or no extra services.
• B) Develop a skimming pricing strategy.
• C) Utilize a high-low approach to pricing with a higher break-even point.
• D) Focus on nonprice competition by offering better service with customers and work on building good customer relationships.

Comprehend the concept and types of contracts implied by the consideration provided.

Interpret the legal consequences of failed consideration in contractual agreements.

Understand the concept and role of consideration in forming a valid contract.

Identify what constitutes legal consideration and differentiate it from inadequate or no consideration.

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Definitions:

Bureaucracy

A large, impersonal organization composed of many clearly defined positions arranged in a hierarchy. A bureaucracy has a permanent, salaried staff of qualified experts and written goals, rules, and procedures. Staff members always try to find ways of running the bureaucracy more efficiently.

Business

Economic activities that involve providing goods or services with the motive of earning profit.

Salaried Staff

Employees who receive a fixed compensation regularly (usually monthly or biannually) regardless of the number of hours worked.

Bureaucracy

A structured organizational system characterized by fixed hierarchical levels, a focus on procedural correctness, and a division of responsibilities designed to streamline operations and decision-making.