Perceived Value and Signaling Value Are Often an Important Part

question 23

Multiple Choice

Perceived value and signaling value are often an important part of a successful differentiation strategy because

• A)of the standardization of buyer needs and preferences.
• B)buyers seldom will pay for value they don't perceive, no matter how real the value of the differentiating extras may be.
• C)buyer satisfaction cannot be achieved until a product's value is promoted through clever ads.
• D)differentiation is all about selling products to sophisticated buyers.
• E)there are no other ways to differentiate a product.

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Definitions:

Capital Intensity Ratio

A financial metric that measures the amount of capital needed per dollar of revenue; used to evaluate the investment intensity of a business's operations.

Fixed Asset Turnover Ratio

A financial metric that measures how efficiently a company uses its fixed assets to generate sales, calculated by dividing net sales by average fixed assets.

Capital Intensity Ratio

This ratio measures a company's investment in physical assets relative to its labor costs, indicating how much capital is used in the production process.

External Financing Needed

The amount of funding that a company must seek from external sources to finance its planned activities or investments, beyond what it can generate internally.