Question

The demand for building materials has dropped due to the slowdown in new housing construction. Woods Corp. is thinking of closing its fine wood division that produces mahogany and cherry lumber for building cabinets and other applications. Under the Boston Consulting Group Matrix, the fine wood division would most likely be classified as a ____.
a. dog
b. cash cow
c. top gun
d. star

Answer 1

Answer:

A. Dog.

Explanation:

This is simply explained to be a business unit within a company which has a much smaller share in a mature market. It does not really generate a strong cash flow for the company and it does not need a large amount of investment to keep the unit running.

This term can also be attributed to a stock which has been a marked underperformer compared to the benchmark indices for a longer period of time. Both terms used in BCG matrix for different business units.

Answer 2

Answer:

a. dog

Explanation:

Under the Boston Consulting Group Matrix, the fine wood division would most likely be classified as a dog.

A dog in business describes the situation where a company's product experience low growth rate with a low market share in the niche it operates; causing it to be liquidated or sold.

Hence, Woods Corp. is thinking of closing its fine wood division that produces mahogany and cherry lumber for building cabinets and other applications because the demand for building materials has dropped due to the slowdown in new housing construction.