A New Subsidiary (Scenario)

question 53

Multiple Choice

A New Subsidiary (Scenario)
Philip works for a large multinational corporation with offices in 23 countries, 64,000 employees worldwide, and $8 billion in annual sales. The company was involved in several different industries: automotive parts, rapid transit systems, and recreational vehicles. Philip is the executive vice-president of new technology ventures.
Philip wants you to investigate and potentially launch a business focusing on alternative energy systems. The first area you are to explore is the potential business opportunity of ocean tidal energy. You are to explore what technology already exists that can be exploited, what additional technology development is needed, and figure out the viability of the tidal energy as an entrepreneurial venture.
-The idea for the marine tidal energy is not brand new,and the technology still holds a great deal of opportunity.Once you have thoroughly researched the venture's feasibility,the next most important step is to ________.

• A)research competitors
• B)find possible customers
• C)develop a business plan
• D)create a marketing strategy

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Definitions:

Purely Competitive Seller

A firm operating in a market where it must accept the prevailing market price and cannot influence it.

Law of Diminishing Returns

An economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other inputs remain at a constant.

Market Value

The current price at which an asset or service can be bought or sold in the open market.

Productivity

Productivity measures the efficiency of production in terms of the amount of goods and services produced per unit of labor, capital, or other inputs.