Classifying an Industry into Strategic Groups Involves Judgment

question 1

Multiple Choice

Classifying an industry into strategic groups involves judgment.If it is useful as an analytical tool,we must exercise caution in deciding what dimensions to use to map these firms.Dimensions include all of the following except

• A) breadth of product and geographic scope.
• B) price and quality.
• C) degree of vertical integration.
• D) management team.

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Definitions:

Economic Profit

The surplus or difference between a firm's total revenues and its opportunity costs, including both explicit and implicit costs.

Sources

The origins or locations from which something is obtained.

Effective Rate

The actual interest rate that a borrower pays on a loan or receives on an investment, taking into account the compounding of interest.

Interest

Interest is the cost of using someone else's money or the return on invested capital, typically expressed as an annual percentage rate.