When a Firm Tries to Increase Its Total Sales by Offering

question 235

Multiple Choice

When a firm tries to increase its total sales by offering new products to new markets, it's pursuing:

• A) diversification.
• B) product development.
• C) market development.
• D) market penetration.
• E) All of these.

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Definitions:

Duration

The measure of the sensitivity of the price of a bond or other debt instrument to changes in interest rates, often expressed in years.

Coupon Bond

A type of bond that pays the holder interest payments at fixed intervals (usually annually or semi-annually) until the bond matures, at which point the principal amount is repaid.

Interest-Rate Risk

The potential for investment losses that result from a change in interest rates, affecting the value of fixed-income securities inversely.

Yield To Maturity

The total return anticipated on a bond if the bond is held until its maturation date, accounting for interest payments and the difference between purchase price and par value.