When Drawing a Strategic Group Map

question 48

Multiple Choice

When drawing a strategic group map

• A)one strategic variable and one financial variable should be used as axes for the map.
• B)it is important for the variables used as axes to be highly correlated.
• C)the best variables to use as axes for the map are those that identify the competitive characteristics that delineate strategic approaches used in the industry.
• D)it is important to use price as the variable for the vertical axis.
• E)the primary objective is to determine which strategic groups are profitable and which are not.

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Definitions:

Forming Department

A specific section within a production facility where raw materials are shaped or configured into their product form.

Overhead Applied

The portion of estimated overhead costs allocated to individual products or job orders based on a predetermined rate or method.

Departments

Organizational units within a company, each specializing in a particular area of operation.

Departmental Predetermined Overhead Rates

Overhead rates set for specific departments based on estimated costs and activities, used to allocate overhead costs more accurately to products.