Which of the following best describes the two dimensions used in the BCG Matrix?

• A. Growth rate of the market and relative market share.
• B. Product pricing and marketing spend.
• C. Geographic reach and production capacity.
• D. Employee turnover and training hours.

Answer: (A)

The two dimensions measured in the BCG Matrix are the growth rate of the market and the unit’s relative market share. The growth rate looks at how fast the market in which the business unit competes is expanding, signaling how much future potential there is and how aggressively you might invest. Relative market share compares the unit’s strength to its biggest competitor, serving as a proxy for competitive power, pricing leverage, and economies of scale. Placing a unit on these two axes creates four categories that help decide where to invest, harvest, or divest. The other options describe factors like pricing, marketing spend, geography, production capacity, or HR metrics, which are not the axes used in the matrix.