The Wider the Value Gap of a Given Product

question 49

Multiple Choice

The wider the value gap of a given product,

• A)the greater the price competition.
• B)the weaker the overall brand structure.
• C)the more insulated the product is from price competition.
• D)the smaller the product differentiation that exists.
• E)the less critical the size of the niche becomes.

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Definitions:

Financial Disaster

A catastrophic situation where financial losses are so extreme that they disrupt the normal operations of an economy or organization.

Propensity to Overestimate

A cognitive bias where individuals tend to overvalue the probability of positive outcomes or success.

Junk Bonds

Risky bonds issued by financially weak companies that pay high rates of interest. Also called high yield bonds.

Corporate Raiders

Investors who buy a large stake in a corporation with the goal to gain control and make changes to increase its value and their profit.