In the context of competitive markets, a focused low-cost strategy based on low cost aims at:

• A. providing unique products to a broad market at premium prices
• B. serving a specific market segment by offering products at lower prices than competitors
• C. maximizing profits by increasing product differentiation across all segments
• D. targeting the entire market with high-cost, high-quality products

Answer: (B)

Verified step by step guidance

1. Understand the concept of a focused low-cost strategy: it involves targeting a specific market segment rather than the entire market.
2. Recognize that the goal of a low-cost strategy is to offer products at lower prices than competitors, thereby attracting price-sensitive customers within that segment.
3. Contrast this with other strategies such as differentiation, which focuses on unique products and premium pricing, or broad market strategies that target all segments.
4. Identify that serving a specific market segment with lower prices aligns with the focused low-cost strategy because it leverages cost advantages to gain competitive edge in that niche.
5. Conclude that the correct interpretation of a focused low-cost strategy is to serve a specific market segment by offering products at lower prices than competitors.