An analysis of Revere Beach Corporation's operating income changes between 2017 and 2018 show the following:
Operating income for 2017 | $4,750,000 |
Add growth component | 180,000 |
Deduct price-recovery component | (60,000) |
Add productivity component | 285,000 |
Operating income for 2018 | $5,155,000 |
Required:
Is Revere's operating income gain consistent with the product differentiation or cost leadership strategy? Explain briefly.