In Mapping Strategic Groups

question 2

Multiple Choice

In mapping strategic groups

• A) one strategic variable and one financial variable should be used as axes for the map.
• B) it is important for the variables used as axes to be highly correlated.
• C) the best variables to use as axes for the map are those that differentiate how rivals have positioned themselves in the marketplace.
• D) it is important to use price as the variable for the vertical axis.
• E) the primary objective is to determine which strategic groups are profitable and which are not.

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Definitions:

Economies of Scale

Cost advantages that a business can achieve due to expansion and increased production volume, leading to lower per-unit costs.

Unfriendly Merger

A takeover or merger which is not supported or welcomed by the target company's management and board of directors.

Preemptive Merger

A strategic merger aimed at preventing potential competition by acquiring or merging with a competitor before they become a larger threat.

Justice Department

A government department responsible for the enforcement of the law and administration of justice.