Scenario 1-2 Chug Enterprises Is Planning to Create a New Line of Line

question 98

Multiple Choice

Scenario 1-2
Chug Enterprises is planning to create a new line of products and enter into the sports drink market. They plan to advertise the first product to teenagers as being the best-tasting sports drink on the market. The second product will be advertised to adults as being the lowest calorie sports drink one can buy. The third product will be advertised to senior citizens as containing calcium, a mineral needed to maintain a healthy bone structure. Each product will have separate, distinctive packaging. 
-(Scenario 1-2) Chug's three different sports drinks are very popular in markets across the world.Now the company plans to launch a similar range of carbonated drinks by building on the popularity of the previous products.This is an example of ________.

• A) market segmentation 
• B) national advertising 
• C) a brand extension 
• D) a differentiation strategy

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Definitions:

Accounting

Process of measuring, interpreting, and communicating financial information to support internal and external business decision making.

Risk-Return Trade-Off

The principle that potential return rises with an increase in risk, describing the balance between the desire for the lowest possible risk and the highest possible returns.

Leverage

The use of various financial instruments or borrowed capital, such as margin, to increase the potential return of an investment.

Hedge Fund Advantage

A benefit unique to hedge funds, often referring to their ability to employ diverse and complex strategies to achieve higher returns compared to traditional investment vehicles.