Final answer:
The correct option is 1). The cosmetic company expanded its market share by adding new product lines, which could increase its customer base, and sales, and strengthen its brand reputation.
Step-by-step explanation:
When a reputed cosmetic company in New York City added new product lines to increase its business, it is said to have expanded its market share. This action involves starting to sell new products, which can potentially attract a broader customer base and increase the total sales of the company. This strategy can lead to growth in terms of revenue and presence in the market, often aiming to make the firm larger and more efficient or to acquire a new product line as seen in the case of mergers. It's also an effective way to contend with competitors and strengthen the company's brand reputation, which is a significant corporate asset.