The Seven Drivers of Cost Advantage

question 3

Multiple Choice

The seven drivers of cost advantage

• A)must be equally examined in all firms.
• B)can be a useful framework within which to compare a firm's cost improvements in the last few years.
• C)can be a useful framework within which to compare a firm's costs with its competitors.
• D)can be a useful framework within which to compare a firm's profit margins with its competitors.

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Definitions:

Fundamental Analysis

Fundamental analysis involves assessing a company's financial statements and health, its management and competitive advantages, and its competitors and markets to determine its stock's value.

Preferred Stock

A class of ownership in a corporation that has a higher claim on its assets and earnings than common stock, typically with fixed dividends and no voting rights.

Constant Dividend

A dividend policy in which a firm aims to distribute a fixed or constant amount of money to its shareholders as dividends on a regular basis.

Perpetuity

A financial concept representing a series of equal payments that continue indefinitely.