Achieving Differentiation Parity Can Be Difficult for a Cost Leader

question 99

Multiple Choice

Achieving differentiation parity can be difficult for a cost leader firm because:

• A) Creating value generally means higher costs.
• B) Achieving parity in the market is always hard.
• C) Cost leaders typically add too much value to their products.
• D) Value chain activities should not be altered.

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Definitions:

Passive Investment

An investment strategy involving minimal buying and selling actions, focusing instead on long-term holding and typically relying on market-wide growth.

Voting Shares

Shares that give the shareholder the right to vote on company matters.

GAAP

Generally Accepted Accounting Principles, a framework of accounting standards, principles, and procedures.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee but not control those policies.