The Value Creation Activities of a Firm Can Be Categorized

question 74

Multiple Choice

The value creation activities of a firm can be categorized as _____ and _____ activities.

• A)primary;support
• B)strategic;functional
• C)ancillary;tertiary
• D)primary;core

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Definitions:

Perfect Competitors

describes a market structure where many firms sell identical products, and no single seller has any influence over market price.

Market Price

The current price at which a good or service can be bought or sold in the marketplace.

Shutdown Point

The shutdown point refers to the level of output and price at which a company cannot cover its variable costs, leading it to cease operations temporarily.

Profit Maximizing Level of Output

The quantity of production that yields the highest possible profit for a firm, determined by the point where marginal cost equals marginal revenue.