Management's Ranking of Business Units and Establishing a Priority for Resource

question 28

Multiple Choice

Management's ranking of business units and establishing a priority for resource allocation should

• A)utilize activity-based costing and benchmarking to determine the funding needs of each business unit.
• B)first consider the strength of funding proposals presented by managers of each division or business unit.
• C)give priority for funding to cash-hog businesses.
• D)put business units with the brightest profit and growth prospects and solid strategic and resource fits at the top of the investment priority list.
• E)always make the company's business units with strong resource strengths and competitive capabilities the central focus of funding initiatives.

---

Definitions:

Differentiated Oligopoly

A market structure in which a few firms offer products or services that are not perfect substitutes, leading to competition based on product differentiation.

Homogeneous Oligopoly

A market condition where a few companies offer products or services that are essentially the same, leading to competition primarily based on price.

Monopolistic Competition

A market structure characterized by many firms selling products that are similar but not identical, allowing for product differentiation and some control over pricing.

Identical Product

A good or service that is exactly the same in quality, function, and design across different sellers, making them perfect substitutes.