Tag: Profit Making

Accounting Multiple Choice Question – 27 October 2024

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

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The board of directors of Alex plc are currently considering whether to pursue a new strategy in respect of one of their major strategic business units.

When evaluating a strategic option in this way, the final decision on whether to pursue the strategy or not should be judged against which ONE of the following criteria?

Select ONE answer:

  1. An acceptability test
  2. A cost of entry test
  3. An attractiveness test
  4. A payoffs test

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 1

  1. Correct == > Gerry Johnson and Kevan Scholes recommend evaluating strategies against the following criteria: Suitability – does the strategy fit the strengths, objectives and image of the company? Feasibility – does the company have the necessary resources to pursue the strategy effectively? Acceptability – is the strategy acceptable to the company’s
  2. Not correct
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 26 October 2024

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

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Alex, a product manager with Lucy plc, is currently preparing a report for the company’s directors in which he will provide an assessment of each of the company’s existing product lines.

In preparing his report, Alex is making use of the Boston Consulting Group Matrix.

He has classified one product, the Midlander, as having a low market share in a high growth market.

In the conclusion to his report, therefore, we would expect Alex to recommend that, regarding the Midlander, Lucy plc should pursue the following?

Select ONE answer:

  1. Either a hold or a divest strategy
  2. Either a hold or a harvest strategy
  3. Either a build or a harvest strategy
  4. Either a build or a leave strategy

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 3

  1. Not correct
  2. Not correct
  3. Correct == > With a low market share of a high growth market, the Midlander would be classified as a Question Mark within the BCG matrix, for which the possible recommended strategies are Build or Harvest.
  4. Not correct

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Accounting Multiple Choice Question – 25 October 2024

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

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Alex plc provides exclusive bird-watching holidays for people over 60 years of age.

In terms of Michael Porter’s generic competitive strategies, this represents a strategy of….?

Select ONE answer:

  1. Differentiation
  2. Cost leadership
  3. Cost focus
  4. Differentiation focus

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 4

  1. Not correct
  2. Not correct
  3. Not correct
  4. Correct == > The exclusivity of the holidays indicates an emphasis on generating competitive advantage through differentiation rather than owl cost, whilst their specialist nature and precise target market (age 60+) indicate a focus strategy rather than a broad competitive scope.

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Accounting Multiple Choice Question – 24 October 2024

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

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Alex pic has a major stakeholder who in the past has been able to exert considerable influence over the quality of the output of the company’s manufacturing operations.

Specifically, because of one recent intervention coordinated by this stakeholder, a production facility was temporarily
closed for three weeks whilst the quality issues were sorted out.

The stakeholder writes regularly to the company’s chairman regarding a range of quality issues surrounding the company.

In terms of Mendelow’s Matrix, the company would be advised to pursue which of the following strategies in respect of this stakeholder?

Select ONE answer:

  1. Keep this stakeholder always informed about the company
  2. Keep this stakeholder satisfied about the company and its strategies
  3. Take minimum effort about this stakeholder as he always complains
  4. Treat this stakeholder as a key player when formulating future strategies

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 4

  1. Not correct
  2. Not correct
  3. Not correct
  4. Correct == > In terms of Mendelow’s matrix, this stakeholder clearly possesses both a high level of interest in the company’s affairs and a high level of power (influence) over them. In such circumstances, the recommended strategy is one of treating the stakeholder concerned as a key player.

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Accounting Multiple Choice Question – 23 October 2024

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

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Regarding Porter’s Five Forces Analysis and new entrants into a market, which of the following pairs of statements is correct?

Select ONE answer:

Encourages new entrants   Erects a barrier to new entrants

  1. High competition Low capital costs
  2. Monopoly supplier of vital component High competition
  3. One large customer Monopoly supplier of vital component
  4. Low competition High capital 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 4

  1. Not correct
  2. Not correct
  3. Not correct
  4. Correct == > Low levels of competition in an industry make it more attractive for new entrants. High capital costs involve risk and fund-raising challenges which can act as a barrier to new entrants.

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