Answer to Question 1
B
Answer to Question 2
The first strategy, in the upper left quadrant of the matrix, is market penetration. In this scenario, we are focused on current products and current marketswe have no plans of expanding our product lines or seeking new customers. We want to try to get our current customers to buy more frequently.
In the top right quadrant of the matrix is product development, which combines current markets with new productswe are keeping our same customers but providing new products for them to buy. This approach works well for entertainment and technology companies and is thought to strengthen customer loyalty.
In the bottom left quadrant of the matrix is market development, which is just the opposite. It combines new markets with current products, so we aren't creating new products, but we're finding new people to buy them. Perhaps we want to advertise differently or have found a new use for an old product that makes it relevant to a new demographic.
Finally, in the bottom right quadrant is the diversifying strategy that combines new products and new markets. This strategy is quite riskyit is best to expand to new markets or new products before trying to do both.
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