I'm not yet avanced or Pro but I will try to answer using my consunting mindset under construction :)
It depends on what seems the most logical and the conditions to prove or disprove your hypothesis. In your particular example, if 1) the question from the interviewer states that the CEO wants to expand, profitability should, in my opinion, come after market analysis : you answer to the main question; which is: should/could I expand ?. If 2) the CEO only wants to increase profitability, then profitability comes first : you answer to the main question: How do I increase profitability ?. Think of it as a combination of conditions to prove your hypothesis, with one depending on anonther.
In 1) If there is no market opportunity, then profitability is of no interest. If there seems to be a market opportunity, then you should evaluate profitability. Remember that in consulting you will want to avoid unnecessary work, because there will be so much necessary work... ! In 2), you should definitely break down profitability first (which somehow always include a bit of a competition analysis at least) to evaluate where the profitability gains are possible and if market expansion is a valuable option.
Also, if you feel that the question might be multi-leveled, do not hesitate to ask where the proirity lies.
Other PrepLoungers, please do not hesitate to correct me if I'm mistaken; I'll learn from it too !