Question

Which of the following statements about the importance of each competitive factor in determining company sales volumes and market shares in a particular geographic region is false? 

• Big S/Q rating differences, big average wholesale price differences, and big differences in the number of models/styles offered in a region weigh heavily in accounting for company-to-company differences in branded pairs sold and market share in all four regions. 

• How much impact each of the 13 competitive factors have in determining each company's branded pairs sold and market share outcomes in a region is not a fixed amount but rather is an amount that varies from "big" (when there are "big" differences in rival company levels of competitive effort on a particular competitive factor) to "small" (when there are "small" differences in the competitive efforts of rival companies) to "zero" (when the competitive efforts that companies exert on any one factor are identical). 

• Tiny cross-company differences in competitive effort on a highly influential competitive factor (like S/Q ratings, the number of models/styles offered, and selling prices) nearly always have a bigger impact on company sales/market share outcomes in a region than do large differences on less influential competitive factors. 

• As the spread between the company with the region's highest S/Q rating and the company with the lowest S/Q rating becomes greater and greater, the stronger is the unit sales/market share impact of the differences in the S/Q ratings among competing companies. 

• The closer to the all-company regional average is a company's price or S/Q rating or brand reputation or number of models (and so on) the smaller is the weighting/impact of that factor in accounting for why that company's regional unit sales/market share is above/below the region's all-company unit sales/market share averages.

Answer 1

Answer: As correctly marked above, FIFTH point is False.

The closer to all-company regional average is the company's price or S/Q rating or brand reputation or number of models (and so on) the smaller is the weighting/impact of that factor in accounting for why that company's regional unit sales/market share is above/below the region's all-company unit sales/market share average.

Reason: S/Q rating can be increased by increasing the number of models and styles produced in the plant. So the closer to all-company price or S/Q rating or brand reputation or no. of models, the larger is the weighting impact. The factors mentioned are direct factor. Change in one factor is directly proportional to unit sales/market share.

Rest all other options(1-4) are true.