A Risk to a Firm That Believes That Its Resources

question 50

Multiple Choice

A risk to a firm that believes that its resources are costly to imitate is:

• A) Rivals may employ substitution and work-around the original design.
• B) Due to the dynamic nature of competition, all resources eventually get imitated.
• C) A firm's products or services are shielded behind social complexity.
• D) Resources that are costly to imitate are based on casual ambiguity.

---

Definitions:

Shareholders

Owners of shares in a corporation, holding a portion of the company's stock and thus a claim on its assets and earnings.

Income Taxes Payable

This represents the amount of income taxes a company owes to the government that has not yet been paid.

Income Tax Expense

Income tax expense represents the amount of money a company expects to pay in taxes based on its taxable income for the current fiscal year.

Comparative Balance Sheets

Financial statements that present the financial position of a company at different points in time, side by side, for comparison.