One of the big dangers in crafting a competitive strategy is that managers, torn between the pros and cons of the various generic strategies, will opt for "stuck in the middle" strategies that represent compromises between lower costs and greater differentiation and between broad and narrow market appeal. True or false? Explain your answer.
What will be an ideal response?
The statement is false. That managers would go for a mix of the various generic strategies is not to be seen as a danger at all. With changing markets, it is important for companies to change their strategies and this may involve a hybrid of two or more strategies. The wise approach would be to respond to the market and the opportunities present in it rather than to be straitjacketed by "pure" strategies.
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Is it a good idea to switch between drafting and revising while composing the content of your message?
What will be an ideal response?
Risk refers to the possibility that sacrifices may exceed benefits.
Answer the following statement true (T) or false (F)
A local day spa is considering investing in a machine that costs $60,000. The machine is expected to generate revenues of $25,000 per year for five years. The machine would be depreciated using the straight-line method with no half-year convention over its five year life and have no salvage value. The company considers the impact of income taxes in all of its capital investment decisions. The
company has a 35 percent income tax rate and desires an after-tax rate of return of 14 percent on its investment. The net present value of the machine is: A) $36,985. B) $10,207. C) $25,828. D) $22,566.
Brad Black and Susan Griffin-Black are cofounders and top managers of one of the last large independently owned organic beauty companies, EO Products. Explain the strategy the partners could use to strengthen EO Products' market position and build a competitive advantage over its rivals. Differentiate between a business strategy and a corporate strategy.
What will be an ideal response?