How Did Marriott Use Economies of Scope to Achieve Greater

question 23

Multiple Choice

How did Marriott use economies of scope to achieve greater economic value than its competitors?

• A) Marriott sees increases in cost per hotel unit as number of customers increases.
• B) Marriott sees decreases in cost per hotel unit as number of customers increases.
• C) Marriott lowered its cost structure by focusing its production assets on one type of hotel, which increased the diversity of its hotel line and thus its differentiated appeal.
• D) Marriott lowered its cost structure by sharing its production assets over several types of hotels, which increased the diversity of its hotel line and thus its differentiated appeal.

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Definitions:

Profits

The financial gain obtained when the amount of revenue gained from a business activity exceeds the expenses, costs, and taxes involved in sustaining the activity.

Cultural Expression

The representation of a community's beliefs, customs, and way of life through various forms such as art, music, or literature.

Commercial Expression

Any form of communication or artistic work primarily intended for or driven by the motive of profit and market success.

Product Placement

A marketing strategy that involves placing a brand, product, or service within the content of a media production, such as movies or television shows, to increase visibility.