Paul's Family Has Owned and Operated a Small Chain of Conventional

question 64

Multiple Choice

Paul's family has owned and operated a small chain of conventional supermarkets for many years.Competition from a variety of other kinds of retailers has adversely affected the business.To address the new competitive reality,Paul wants to apply what he recently learned as a marketing major and he has recommended that his family's business should

• A) emphasize fresh, locally sourced perishables.
• B) target the broadest possible customer base.
• C) eliminate customer frills and extras.
• D) offer fewer private-label brands.
• E) offer more national brand packaged goods and few perishables.

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Definitions:

Diminishing Returns

A principle in economics that states as one input variable is incrementally increased, there comes a point when the rate of resultant output begins to decrease.

Variable Inputs

Inputs, such as labor and materials, whose usage changes according to the level of production.

Economies Of Scale

Cost advantages reaped by companies when production becomes efficient, as the scale of operation increases, leading to a reduction in average cost per unit.

Specialization

The focus of a business or individual on a limited scope of products or skills, allowing for increased efficiency and expertise.