Which of the Following Statements Is True About Fragmented Industries

question 15

Multiple Choice

Which of the following statements is true about fragmented industries?

• A)They are usually characterized by large mass-production operations.
• B)They essentially enjoy a national brand loyalty.
• C)They require companies to use focus strategies because of specialized customer needs.
• D)They do not attract new entrants as they have extremely high entry barriers due to economies of scale.
• E)They are usually dominated by one or two large companies that enjoy the power to influence industry prices.

---

Definitions:

Overapplied

A scenario in which the overhead cost assigned to manufacturing exceeds the overhead that was actually incurred.

Direct Labor-Hours

A measure of the labor directly involved in manufacturing a product, represented in hours.

Predetermined Overhead Rate

A rate calculated before a period begins, based on estimated overhead costs and activity levels, used to allocate overhead to products.

Actual Manufacturing Overhead

The real costs incurred in the manufacturing process that are not directly tied to production, including utilities, maintenance, and factory rent.