What distinguishes corporate strategy from business strategy?

• A. It outlines how a single business competes within its market.
• B. It describes day-to-day operational processes.
• C. It defines which businesses the firm should own and how to allocate resources among them.
• D. It articulates the firm's core mission and long-term vision.

Answer: (C)

The key idea being tested is how decisions at the corporate level differ from those at the business level. Corporate strategy focuses on the firm’s overall portfolio and how it allocates resources across multiple businesses or industries. It asks which businesses the company should own or control, whether to diversify, merge, acquire, or divest, and how to balance investments among those areas to create overall value and synergy.

That’s why the best choice defines which businesses the firm should own and how to allocate resources among them. It captures the portfolio and governance aspect that sets the boundaries for the whole company. In contrast, outlining how a single business competes within its market belongs to business strategy, which deals with competitive positioning, pricing, product choices, and capabilities in a specific market. Describing day-to-day operations or focusing on mission and long-term vision addresses operations or purpose-oriented aspects, not the portfolio decisions that distinguish corporate strategy.