To Be Effective, Firms Need to

question 85

Multiple Choice

To be effective, firms need to

• A) back up their visions with strategic commitments that are costly and difficult to reverse.
• B) increase their strategic flexibility by developing product-oriented vision statements.
• C) isolate top managers from the organizational values.
• D) pursue visions that are exclusively financial and not aspirational.

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Definitions:

Gains From Trade

The benefit that entities receive from engaging in voluntary trade, often resulting in better allocation of resources and increased efficiency.

Comparative Advantage

The proficiency of an entity, whether it's an individual, corporate body, or state, to create a good or offer a service at a more economical opportunity cost than its competition.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision or choosing a particular course of action.

Comparative Advantage

The ability of an individual, firm, or country to produce a good or service at a lower opportunity cost than competitors, leading to more efficient global production patterns.