Business Studies Multiple Choice Question – 2 October 2021

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Business Studies
Photo by Andrea Piacquadio on Pexels.com

Woolies is an international supermarket chain offering high-quality products at prices 40% lower than rival supermarkets.

The most likely reason for Woolies to use this strategy is to …?

Select ONE answer:

  1. sample the market
  2. gain a competitive advantage
  3. test the market
  4. reduce production costs

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

  1. Not correct – Woolies is selling all its products to all of the market. 
  2. Correct – competitive advantage is a unique aspect of the business that competitors cannot easily imitate which can be based on innovation, reputation, quality, cost and price. Woolies differentiates itself from its retail rivals by charging lower prices, therefore gaining a competitive advantage, because lower prices are likely to attract more customers thereby increasing revenues and or profit.
  3. Not correct – the products have already been tested in the market before being offered for sale in Woolies.
  4. Not correct – the Woolies’s strategy is to do with sales revenue and not costs which are dependent on the price of factor inputs such as wages, electricity and rent. 

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Author: stuart001uk2014

Referral marketing, business, economics and accounting s​pecialist & corporate mentor

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s