Final answer:
The statement is true; the BCG matrix designates organizations with high market growth and high market share as stars. Stars require considerable investment to support their high growth and strong market position with the potential to become cash cows.
Step-by-step explanation:
The statement is true. According to the BCG matrix, organizations that experience high growth and have a high market share are classified as stars. In the BCG matrix, these entities are seen as leaders in a rapidly growing market, and as such, the strategy often involves significant investment to support their growth and maintain their strong position in the market.
The vital aspect of the BCG matrix is how it categorizes business units or products into four quadrants based on combinations of market growth and market share relative to the largest competitor. The four quadrants are Stars, Cash Cows, Question Marks, and Dogs. Stars are ideal entities that generate cash but also consume a lot of cash due to their growth. Consequently, firms often decide to keep investing in Stars, with the hope they will become Cash Cows once the market's growth rate declines, provided they maintain their high market share.