CIPS L4M2 Exam - Topic 2 Question 19 Discussion

Actual exam question for CIPS's L4M2 exam

Question #: 19
Topic #: 2

[All L4M2 Questions]

Which of the following are recognised competitive strategies?

1. Winning new business at all cost

2. Getting more customers' attention

3. Creating stand-out products and brands

4. Focusing on niche market

5. Acquiring competitors

A3 and 4 only

B3 and 5 only

C1 and 2 only

D2 and 5 only

Show Suggested Answer

Suggested Answer: B

Payback period is the time in which the initial outlay of an investment is expected to be recovered through the cash inflows generated by the investment. It is one of the simplest investment apprais-al techniques.

Since cash flow estimates are quite accurate for periods in the near future and relatively inaccurate for periods in distant future due to economic and operational uncertainties, payback period is an indicator of risk inherent in a project because it takes initial inflows into account and ignores the cash flows after the point at which the initial investment is recovered.

The formula to calculate the payback period of an investment depends on whether the periodic cash inflows from the project are even or uneven.

If the cash inflows are even (such as for investments in annuities), the formula to calculate payback period is:

Payback Period = Initial Investment / Net Cash Flow per Period

When cash inflows are uneven, we need to calculate the cumulative net cash flow for each period and then use the following formula:

Payback Period =A + (B/C)

Where,

A is the last period number with a negative cumulative cash flow;

B is the absolute value (i.e. value without negative sign) of cumulative net cash flow at the end of the period A; and

C is the total cash inflow during the period following period A

Cumulative net cash flow is the sum of inflows to date, minus the initial outflow.

- Payback Period | Formulas, Calculation & Examples (xplaind.com)

- CIPS study guide page 44-47

LO 1, AC 1.3

by Raymon at Jul 30, 2023, 07:27 AM

Limited Time Offer

25%

Off

Get Premium L4M2 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Luke

3 months ago

I disagree, 2 is crucial for growth too!

upvoted 0 times

...

Walton

3 months ago

Getting attention is important, but not everything!

upvoted 0 times

...

Queen

4 months ago

Surprised that 1 is even an option! Sounds risky.

upvoted 0 times

...

Roxane

4 months ago

I think 3 and 5 make more sense for competition.

upvoted 0 times

...

Kathrine

4 months ago

Definitely 3 and 4! Stand-out products are key.

upvoted 0 times

...

Justine

4 months ago

I feel like getting more customers' attention is important, but it might not be a solid strategy on its own. I think I’ll go with option B.

upvoted 0 times

...

Rikki

4 months ago

Winning new business at all costs seems a bit aggressive for a strategy. I’m leaning towards option A, but I’m not entirely confident.

upvoted 0 times

...

Bo

5 months ago

I remember a practice question that mentioned differentiation and niche strategies. I feel like options 3 and 4 make the most sense here.

upvoted 0 times

...

Billye

5 months ago

I think creating stand-out products and focusing on niche markets are definitely competitive strategies, but I'm not sure if acquiring competitors fits in there.

upvoted 0 times

...

Bettina

5 months ago

I'm pretty sure the most common method is tips, since the question specifically mentions the 2020 Report to the Nations.

upvoted 0 times

...

Kaycee

5 months ago

Okay, let's see. MPLS is used for VPNs, traffic engineering, and improving network resilience. I'm guessing the answer is network security, since that's not a primary MPLS application.

upvoted 0 times

...

Yasuko

5 months ago

Hmm, this seems straightforward. The question is asking about the effect of the pruning policy, so I think the key is understanding what that policy does. I'll review the options and see which one best describes the effect.

upvoted 0 times

...

Ronnie

5 months ago

Hmm, I'm a bit unsure about the statement that ABC establishes "less accurate" costs. I'll need to double-check that, as I thought the whole point was to get more accurate product/service costs.

upvoted 0 times

...

Jacquline

10 months ago

Winning new business at all cost? Sounds like my last Tinder date! I'm going with A) 3 and 4 only - that's the real secret to success in this dog-eat-dog world.

upvoted 0 times

Ma

8 months ago

Acquiring competitors can be risky, but it can also help you expand your market share quickly.

upvoted 0 times

...

Delsie

8 months ago

I think focusing on a niche market can also be a successful strategy, it allows you to really target your audience.

upvoted 0 times

...

Aliza

9 months ago

I agree, creating stand-out products and brands is key to staying ahead of the competition.

upvoted 0 times

...

Chanel

10 months ago

I'm going to have to go with B) 3 and 5 only. Acquiring competitors can be a powerful way to gain market share and eliminate the competition. *winks*

upvoted 0 times

...

France

10 months ago

C'mon, everyone knows that 'winning new business at all cost' is a surefire way to run your company into the ground. I'm going with A) 3 and 4 only.

upvoted 0 times

Olive

9 months ago

Yeah, it's important to have a clear strategy rather than just trying to win new business at any cost.

upvoted 0 times

...

Celia

9 months ago

I think acquiring competitors can be risky, so I'm going with A) 3 and 4 only too.

upvoted 0 times

...

Talia

9 months ago

I agree, focusing on niche markets and creating stand-out products is key.

upvoted 0 times

...

Lang

10 months ago

Hmm, I'm not sure. Winning new business at all cost and acquiring competitors also sound like viable strategies. This is a tough one!

upvoted 0 times

Yolando

8 months ago

User 4: I think the answer might be option B) 3 and 5 only.

upvoted 0 times

...

Wilburn

8 months ago

User 3: Winning new business at all cost and acquiring competitors seem like aggressive strategies.

upvoted 0 times

...

Buffy

9 months ago

User 2: I agree, but I also think focusing on niche markets can be effective.

upvoted 0 times

...

Alpha

9 months ago

User 1: I think creating stand-out products and brands is definitely a recognised competitive strategy.

upvoted 0 times

...

Tora

9 months ago

Abraham: Yeah, that makes sense too. So maybe the answer is D) 2 and 5 only.

upvoted 0 times

...

Von

9 months ago

User 3: Acquiring competitors could also be a good strategy, don't you think?

upvoted 0 times

...

Mammie

9 months ago

User 2: I agree, those are the ones that stand out to me as well.

upvoted 0 times

...

Viola

10 months ago

User 1: I think the recognised competitive strategies are creating stand-out products and brands, and focusing on niche market.

upvoted 0 times

...

Abraham

10 months ago

User 2: I agree, that's one of the options listed.

upvoted 0 times

...

Leoma

10 months ago

User 1: I think creating stand-out products and brands is definitely a recognized competitive strategy.

upvoted 0 times

...

Cathrine

11 months ago

I think the answer is C) 1 and 2 only because winning new business and getting more customers' attention are important competitive strategies.

upvoted 0 times

...

Theola

11 months ago

I disagree, I believe the answer is B) 3 and 5 only.

upvoted 0 times

...

Dorian

11 months ago

I think the correct answer is A) 3 and 4 only. Creating stand-out products and focusing on a niche market are well-established competitive strategies.

upvoted 0 times