Question detail
Harbour Hire serves small retailers while taking a loan; the case evidence includes capacity utilisation of ?10,570, sales of 275 units, and a 31% change in costs or demand. Which option best applies Explain outsourcing and external growth through mergers and takeovers?
Try the question, check the answer, then read the explanation to understand the curriculum point.
At a glance
MCQ
Type
practice
Style
Topic
Expanding a business
Question
- A. Use outsourcing, takeovers, mergers to judge capacity utilisation, owners impact, and the business objective in Methods of expansion.
- B. Give only a definition of Expanding a business without using the case evidence.
- C. Treat stakeholders and shareholders as identical and ignore the effect on owners.
- D. Choose the largest sales figure without checking costs, finance, or context.
Answer
The correct option is: Use outsourcing, takeovers, mergers to judge capacity utilisation, owners impact, and the business objective in Methods of expansion.
Explanation
Choose this response because Use outsourcing, takeovers, mergers to judge capacity utilisation, owners impact, and the business objective in Methods of expansion. The case evidence gives ?12,070, 275 units, and 31%, so the answer must explain the commercial effect rather than repeat a definition. The distractors are weaker because they confuse stakeholders and shareholders, miss the owners, or ignore the business objective.
Common mistake
Methods of expansion common mistake 1
Giving a vague answer instead of directly addressing: Explain outsourcing and external growth through mergers and takeovers..
Answer by clearly explaining how to explain outsourcing and external growth through mergers and takeovers..
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