Achieving a Cost Advantage Over Rivals Entails

question 53

Multiple Choice

Achieving a cost advantage over rivals entails

• A) concentrating on the primary activities portion of the value chain and outsourcing all support activities.
• B) being a first mover in pursuing backward and forward integration,and controlling as much of the industry value chain as possible.
• C) performing value chain activities more cost-effectively than rivals and finding ways to eliminate or bypass some cost-producing activities.
• D) minimizing R&D expenses and paying below-average wages and salaries to conserve on labor costs.
• E) producing a standard product,redesigning the product infrequently,and having minimal advertising.

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Definitions:

Cross Elasticity

A measure of how the quantity demanded of one good responds to a change in the price of another good.

Substitute Goods

Products or services that can be used in place of each other. When the price of one falls, the demand for the other product falls; conversely, when the price of one product rises, the demand for the other product rises.

Cross Elasticity

A measure of how the quantity demanded of one good responds to a change in the price of another good, indicating the degree of substitutability or complementarity between them.

Percentage Change

A mathematical calculation that shows how much a quantity has increased or decreased in percentage terms over a specific period.