The Difference Between a Resource and a Capability Is That

question 57

Multiple Choice

The difference between a resource and a capability is that

• A)a resource refers to a company's best-executed functional strategy and a capability refers to a company's best-executed business strategy.
• B)a resource refers to a company's most strategically important asset,whereas a capability refers to the basis of a company's competitive advantage over rivals.
• C)a resource is a competitively relevant internal activity that a firm performs especially well relative to other internal activities,whereas a capability is a competitively important activity performed by key strategic allies.
• D)a resource represents a competitive asset that is owned or controlled by the company,whereas a capability is a competently performed internal activity that is developed through the deployment of the company's resources.
• E)a resource usually resides in a company's technology and physical assets (state-of-the-art plants and equipment,attractive real estate locations,and so on),whereas a capability usually resides in a company's human capital,information capital,or organizational capital.

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Definitions:

Retained Earnings

The portion of a company's profits that is kept or retained rather than paid out to shareholders as dividends, typically used for reinvestment in the business, paying off debt, or other purposes.

Additional Paid-in Capital

The amount of money investors pay above the par value of stocks during an equity financing round; it represents excess capital collected from shareholders.

Common Stock

Common Stock refers to shares representing ownership in a corporation, granting holders voting rights and a share in the company’s profits through dividends.