Which of the Following Statements About Simultaneously Pursuing Both a Low-Cost

question 71

Multiple Choice

Which of the following statements about simultaneously pursuing both a low-cost strategy and a differentiation strategy is true?

• A) Organizations stuck in the middle tend to have high levels of performance than those that pursue a low-cost or a differentiation strategy.
• B) Focusing on differentiation of a product will result in reduced costs for a company.
• C) Extremely well managed companies may be able to keep low costs and differentiate their products.
• D) Managers try to gain a competitive advantage by focusing only on driving the company's costs down below the costs of industry rivals.
• E) Managers try to gain a competitive advantage by focusing only on distinguishing an organization's products from the products of competitors on dimensions such as product design, quality, or after-sales service.

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Definitions:

Discount Rate

The applied rate in discounted cash flow studies for turning future cash flows into their equivalent present-day financial value.

Cash Inflows

Money received by a business from its operations, investments, or financing activities.

Discount Factor

A multiplier used to calculate the present value of future cash flows; reflects the time value of money.

Invested Today

Refers to the allocation of resources, such as capital or time, in the present with the expectation of future returns.