A Company in a Mature Industry Which Is Good at Cost

question 62

Multiple Choice

A company in a mature industry which is good at cost reduction is exhibiting

• A)economy of scale through better use of fixed assets.
• B)potential for economy of scope based on organisational or managerial capability.
• C)potential for economy of scope based on intangible resources.
• D)no potential for economy of scope.

---

Definitions:

Accrued Interest

Interest that has accumulated on a bond since the last interest payment was made but has not yet been paid to the bondholder.

Quote Sheet

A document or digital view listing the price quotes for various financial instruments or commodities, often used in trading.

Convertible Bond

A type of bond that can be converted into a predetermined amount of the company's equity, usually at the discretion of the bondholder.

Market Conversion Value

The current market value of a convertible security if it were converted into the underlying shares of stock today.