What Is the Primary Disadvantage of Employing a Product Specialization

question 257

Multiple Choice

What is the primary disadvantage of employing a product specialization strategy?

• A)The organization may be spread too thin.
• B)The organization achieves neither marketing nor manufacturing synergies.
• C)R&D-manufacturing have the difficulty of producing multiple new lines.
• D)There are too many product substitutes over which a firm would not have control.
• E)Gaining market distribution will be costly.

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Definitions:

Anticipated Losses

Expected financial deficits that are predicted based on current circumstances or activities.

Completed Contract

An accounting method where revenue and income are recognized only after a contract is finished or the work is completely done.

Percentage Of Completion

An accounting method used to recognize revenue and expenses of long-term contracts proportionally as the contract progresses toward completion.

Gross Profit

The financial gain obtained after subtracting the cost of goods sold from total sales revenue.