The term "strategic business unit" is often used to describe a(n):
A) investment center.
B) revenue center.
C) profit center.
D) cost center.

Question

Quizplus · Accepted Answer

The term "strategic business unit" (SBU) is often used to describe an investment center, which is a unit of a company that has its own revenues, expenses, and assets, and is evaluated based on its return on investment (ROI). SBUs are often marketed as separate brands, products, or services, and are managed independently within the company. They are given the authority and resources to formulate and implement their own strategies, tactics, and budgets, and to pursue their own goals and objectives. As such, they can be seen as mini-companies within the larger organization, with their own mission, vision, and values. While SBUs may also generate revenue, profit, and cost data, they are primarily evaluated on their ability to generate positive cash flows and to create long-term value for the company as a whole.

The Term "Strategic Business Unit" Is Often Used to Describe