General Studies · Strategic Management
One of the key assumptions of the Boston Consulting Group (BCG) Growth-Share Matrix is:
- 1Market growth rate cannot be used as a proxy to determine overall market attractiveness.
- 2Market share acts purely as a proxy to macroeconomic inflation.
- 3Relative market share has a positive effect on cash generation because profits are positively related to market share via the experience curve.✓
- 4Cash flow can be equated directly with accounting profitability under all lifecycle stages.
Correct answer
Relative market share has a positive effect on cash generation because profits are positively related to market share via the experience curve.
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