Which of the following strategies would be most appropriate for a market-oriented firm?

• A. Setting prices based solely on production costs
• B. Focusing on understanding and responding to consumer needs and preferences
• C. Ignoring market research and relying on intuition
• D. Maximizing production without regard to consumer demand

Answer: (B)

Verified step by step guidance

1. Understand the concept of a market-oriented firm: such a firm prioritizes understanding and responding to consumer needs and preferences to guide its business decisions.
2. Recognize that setting prices based solely on production costs is a cost-oriented strategy, which does not necessarily consider consumer demand or preferences.
3. Note that ignoring market research and relying on intuition can lead to decisions that are not aligned with actual market conditions or consumer desires.
4. Maximizing production without regard to consumer demand risks overproduction and inefficiency, as it does not consider what consumers actually want to buy.
5. Conclude that the most appropriate strategy for a market-oriented firm is to focus on understanding and responding to consumer needs and preferences, ensuring that products and services meet market demand.