What Kind of Strategy Is One by Which a Firm

question 21

Multiple Choice

What kind of strategy is one by which a firm maintains price parity with its competitors and profits from its benefit or cost advantage primarily through high price-cost margins,rather than through a higher market share?

• A)Pricing strategy
• B)Share strategy
• C)Margin strategy
• D)Focus strategy
• E)Generic strategy

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Definitions:

Present Value

The present value of a future amount of money or series of cash flows, based on a particular rate of return.

Future Cash Inflows

Projected cash earnings from investments, operations, or financial instruments over a specified future period.

Net Present Value

A method of evaluating the profitability of an investment by calculating the difference between the present value of cash inflows and outflows over a period of time.

Present Value

The value today of an anticipated sum of money or sequence of cash flows, when calculated with a certain return rate.