After Having a Monopoly in the Diamond Market for Many

question 111

Multiple Choice

After having a monopoly in the diamond market for many years, by 2000 the De Beers company faced competition from other companies.To maintain its market share, De Beers

• A)began buying so-called "blood diamonds" in order to keep these diamonds out of the control of other diamond companies.
• B)adopted a strategy of differentiating its diamonds. Each of its diamonds is now marked with a microscopic brand.
• C)bought diamond mines in Canada and Russia that had been its competitors.
• D)lowered the prices of its diamonds to make the market appear less profitable to potential competitors.

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Definitions:

Back-end Load

A fee charged to investors when they redeem shares from a mutual fund, typically used to compensate financial advisors.

Annual Fees

Regular charges imposed once a year for the use of a service or the participation in an investment or credit facility.

12b-1 Fee

A fee charged by mutual funds to cover distribution and marketing expenses, included in the fund's expense ratio and paid by its shareholders.

NAV

Net Asset Value, the total value of all the securities in an investment portfolio minus any liabilities, divided by the number of shares outstanding.