Which statement best defines increasing market share?

• A. To increase the percentage of total sales in a market a business has
• B. Private sector aim
• C. Allows the firm to weaken competition
• D. Takes a firm closer to becoming market leader

Answer: (A)

Increasing market share means increasing the percentage of total sales in a market that a business has. Market share is the firm's sales divided by total market sales, usually shown as a percentage, and it can be measured in value or volume. So, to increase market share is to capture a bigger slice of the overall market, either by growing your own sales faster than the market or by gaining share as the market grows.

The other statements don’t define market share. A private sector aim isn’t about share itself but about the broader goal of operating in the private sector. Saying it allows the firm to weaken competition describes a possible consequence of actions that could increase share, not the definition of share. And taking a firm closer to becoming market leader is a potential outcome of increasing market share, but it isn’t the definition—market share simply measures the portion of the market you hold, regardless of whether you’re first or second.