Question

According to the text, which of the following is not one of the rationales for why most seasoned managers supplement their analyses by looking at economic growth rates as well as measures of an economy's absolute size?

Option 1: To identify potential markets for expansion.
Option 2: To assess the impact of inflation on consumer purchasing power.
Option 3: To determine the historical performance of the stock market.
Option 4: To understand the cultural diversity within the workforce.

Answer 1

Seasoned managers supplement their analyses by looking at economic growth rates to identify potential markets for expansion, assess the impact of inflation on consumer purchasing power, and understand the historical performance of the stock market.

Step-by-step explanation:

Looking at economic growth rates as well as measures of an economy's absolute size helps seasoned managers in various ways. One of the rationales for this practice is to identify potential markets for expansion. By analyzing economic growth rates, managers can identify countries or regions experiencing rapid economic growth, which may present opportunities for expanding their business. Another rationale is to assess the impact of inflation on consumer purchasing power. Inflation can erode the purchasing power of consumers, so understanding its impact allows managers to adjust their pricing strategies. Lastly, understanding the historical performance of the stock market can help managers make informed investment decisions.