Which of the Following Is NOT a Reliable Measure of How

question 44

Multiple Choice

Which of the following is NOT a reliable measure of how well a company's current strategy is working?

• A) whether the company's sales are growing faster, slower, or about the same pace as the industry as a whole, thus resulting in a rising, falling, or stable market share
• B) whether it has a larger number of competitive assets than competitive liabilities and whether it has a superior quality product
• C) the firm's image and reputation with its customers
• D) whether its profit margins are rising or falling and how large its margins are relative to those of its rivals
• E) evidence of improvement in internal processes such as defect rate, order fulfillment, delivery times, days of inventory, and employee productivity

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Definitions:

Natural Monopolies

A situation where a single firm can supply a product or service to an entire market at a lower cost than two or more firms, making competition impractical.

Diseconomies of Scale

A situation in which a company or business grows so large that the costs per unit increase.

Long-run ATC

Long-run Average Total Cost refers to the per-unit cost of production in the long term where all inputs are considered variable.

Rate of Return

The rise or fall in an investment's worth over a designated period, articulated as a percentage of the cost of the investment.