CMA Final · Entrepreneurship and Startup · Value Addition
Which statement about 'value addition' by a startup through a strong brand is most accurate?
A strong brand adds value because customers perceive more worth than the physical product alone, which lets the startup command a premium price and build loyalty. It does not remove competition, replace customer research, or apply only to large listed companies.
- AIt lets the firm charge a price premium because customers perceive higher worth than the physical product aloneCorrect
- BIt reduces the need to understand customer needs
- CIt is relevant only to large listed companies
- DIt eliminates all competition in the market
Explanation
Branding builds trust, recognition and perceived quality, which supports premium pricing and loyalty. It does not replace customer understanding, applies equally to startups, and cannot remove competition entirely.
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