Question

IBM’s principal reason for existing is to earn a profit for its shareholders. The means by which IBM does this is through the manufacture of computers. These two statements describe, respectively, IBM’s ____________________.

a) Mission and vision
b) Core values
c) Strategic goals
d) Business model

Answer 1

The descriptions of IBM are related to its business model which focuses on earning profit for shareholders through computer manufacturing. Profit is critical for the survival of businesses and determines whether they stay in operation or exit an industry.

Step-by-step explanation:

The two statements about IBM describe, respectively, IBM's business model. IBM's principal reason for existing, to earn a profit for its shareholders, defines its overarching business aim. The means by which IBM achieves this aim, through the manufacture of computers, outlines how the company operates and generates revenue. Businesses generally engage in activities with the intent to make a profit, which involves making decisions that can improve their financial status. Profits are essential as they determine whether a business will continue operating or not. Firms exit an industry when they are no longer able to make a profit, which is a clear signal that a business venture is not sustainable.