The Boston Consulting Group Matrix Refers To

question 70

Multiple Choice

The Boston Consulting Group matrix refers to:

• A) a concentration strategy that involves acquiring or merging with a rival.
• B) an approach to diversification.
• C) an approach to portfolio planning.
• D) a strategy that firms use to successfully compete only within a single industry.
• E) a strategy that requires a firm to get involved in new portions of the value chain.

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Definitions:

Variable Expenses

Expenses that vary directly with the amount of activity or production volume.

Fixed Expenses

Expenses that do not change with the level of production or sales, remaining constant regardless of business activity levels.

Degree Of Operating Leverage

A ratio that measures a company's fixed costs as a proportion of its total costs, indicating how a change in sales will affect its operating income.

Contribution Format

A type of income statement where costs are separated into variable and fixed categories, highlighting the contribution margin.