A BCG Growth-Share Matrix,a Relative Market Share of 10× at the Left

question 197

Multiple Choice

a BCG growth-share matrix,a relative market share of 10× at the left end of the scale on its horizontal axis means that the SBU has 10 times the share of its largest competitor,whereas a relative market share of 0.1× at the right end of the scale on its horizontal axis means that

• A) the SBU has only 10 percent of the share of its smallest competitor.
• B) the SBU has 100 percent of the share of its largest competitor.
• C) the growth rate between the SBU and the next largest competitor is actually identical.
• D) the SBU has only 10 percent of the share of its largest competitor.
• E) the industry growth rate is declining.

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Definitions:

Competitor

A person or entity that competes with another, particularly in business or in the offering of goods and services.

Capital Structure

Capital structure is the mixture of a company's long-term debt, specific short-term debt, common equity, and preferred equity which finance its overall operations and growth.

Leverage

Taking on debt to magnify the prospective profits of an investing activity.

Acquisition Price Premium

This refers to the amount by which the purchase price of a company exceeds the pre-acquisition market value of its shares, often reflecting the buyer's estimate of the target's intrinsic value or synergies to be realized.