Which of the Following Constitutes a Disadvantage of the Differentiation

question 44

Multiple Choice

Which of the following constitutes a disadvantage of the differentiation strategy?

• A) A differentiation strategy lacks the capacity to generate buyer loyalty.
• B) Competitors are able to imitate the features well enough that they are no longer unique.
• C) The firm needs to attract huge numbers of customers in order to have a good overall level of profit.
• D) Differentiation lacks an ability to obtain premium prices from customers.
• E) A differentiation strategy allows the entrance of new companies in the market.

Understand the concept of net working capital and its significance to a firm’s financial health.

Understand the calculation and management of free cash flow.

Recognize the potential biases in management-prepared financial reports and their implications.

Learn about the mechanisms of cash sources and uses and their impact on a firm's liquidity.

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Definitions:

Balanced Reciprocity

A form of exchange where goods or services of roughly equal value are traded within a specified time frame, often among people with a social relationship.

Barter

is a method of exchange where goods or services are traded directly for other goods or services without the use of money.

Generalized Reciprocity

A form of exchange where goods or services are given with the expectation that the recipient will reciprocate in the future without a specified value or time frame.

Generalized Reciprocity

A type of exchange where goods or services are provided without an immediate or specified return, often found within close relationships or communities.