An Opportunity That Makes It Possible for a New Business

question 31

Multiple Choice

An opportunity that makes it possible for a new business to gain a foothold in a market is referred to as a(n) _____.

• A) parallel competition
• B) incremental innovation
• C) differentiation strategy
• D) entry wedge

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Definitions:

Discounting

The process of determining the present value of a payment or series of payments that will be received in the future.

Present Value Interest Factor

A factor used to calculate the present value of a sum that is to be received in the future, accounting for the time value of money.

Non-Interest Bearing Note

A debt instrument that does not pay interest but is issued at a discount to its redemption value.

Present Value

The current value of a future sum of money or stream of cash flows given a specified rate of return, used to assess the worth of an investment.