📚 Learning Guide
Business Strategy
medium

A company has recently gained a competitive advantage in its market. Which underlying cause is most likely responsible for this change?

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Learning Path
Learning Path

Question & Answer
1
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2
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3
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4
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Choose the Best Answer

A

The company invested heavily in marketing without analyzing its market position

B

The company effectively utilized its existing resources and competencies to innovate

C

The company reduced its workforce to cut costs

D

The company followed its competitors' strategies blindly

Understanding the Answer

Let's break down why this is correct

Answer

The company most likely gained its advantage by creating a unique value proposition that customers cannot easily copy, such as a breakthrough product feature or a lower price that still preserves quality. This change usually comes from a deliberate shift in strategy—whether through investing in research and development, streamlining operations, or forging powerful partnerships. For example, a smartphone maker that introduces a proprietary camera sensor can command higher sales while competitors use off‑the‑shelf components. By aligning its resources and capabilities with a clear customer need, the firm turns a strategic decision into a lasting competitive edge.

Detailed Explanation

Using the company’s own strengths and skills, it created something new that customers liked. Other options are incorrect because People often think more money spent on ads automatically wins customers, but ads only raise awareness; Cutting jobs can save money, but it usually hurts teamwork and ideas.

Key Concepts

Competitive Advantage
Resource Utilization
Market Dynamics
Topic

Business Strategy

Difficulty

medium level question

Cognitive Level

understand

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