If Microsoft Decided to Sell Mobile Phones Under the Xbox

question 105

True/False

If Microsoft decided to sell mobile phones under the Xbox brand (which it uses for its gaming systems), this would be an example of a line extension.
This is a brand extension, not a line extension. A brand extension is the use of the same brand name in a different product line. Phones and gaming systems are different product lines.

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Definitions:

Public Company Accounting Oversight Board

A nonprofit organization established by Congress to oversee the audits of public companies to ensure the accuracy and integrity of financial statements.

Return on Assets Ratio

A financial ratio that indicates how profitable a company is relative to its total assets, measuring how efficiently assets are being used to produce profit.