A) are preferable to short-term contracts when there is a minimal need for cooperation. B) are preferable to vertical integration when it is not feasible to exchange hostages. C) generally result in lower prices than competitive bidding. D) achieve exactly the same outcomes as vertical integration, but they incur higher bureaucratic costs. E) are a low-cost alternative to vertical integration when it is possible to build cooperative relationships with suppliers. A) are preferable to short-term contracts when there is a minimal need for cooperation. B) are preferable to vertical integration when it is not feasible to exchange hostages. C) generally result in lower prices than competitive bidding. D) achieve exactly the same outcomes as vertical integration, but they incur higher bureaucratic costs. E) are a low-cost alternative to vertical integration when it is possible to build cooperative relationships with suppliers.

Exam 9: Corporate-Level Strategy: Horizontal Integration, Vertical Integration, and Strategic Outsourcing

Vertical integration can raise costs if,over time,a company's leaders continue to purchase inputs from company-owned suppliers even when independent suppliers can supply the same inputs at lower cost.

(True/False)

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Question 21

In 1999,two pharmaceutical companies that held an equal market share decided to pool their operations to create a new firm that was known by a different name.This is an example of a(n):

(Multiple Choice)

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Question 22

When a company outsources its noncore activities to specialists,it loses its capabilities to differentiate its final products.

(True/False)

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Question 23

A merger occurs when one company uses its capital resources,such as stock,debt,or cash,to purchase another company.

(True/False)

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Question 24

Under a competitive bidding strategy,independent component suppliers compete with each other to be the company that will be chosen to supply:

(Multiple Choice)

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Question 25

Which of the following is not a benefit of vertical integration?

(Multiple Choice)

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Question 26

Even though companies may invest in specialized assets to build competitive advantage,it is seldom necessary that suppliers do so.

(True/False)

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Question 27

How can strategic outsourcing strengthen a company's business model and increase its profitability?

(Essay)

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Question 28

Compare the benefits and risks associated with horizontal and vertical integration.Under what circumstances would a firm prefer one over the other?

(Essay)

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Question 29

Outsourcing occurs when a firm:

(Multiple Choice)

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Question 30

A company should first choose a corporate-level strategy,and then look at how changes will affect a company's current business model and strategies.

(True/False)

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Question 31

Strategic alliance is a type of long-term contract that involves one company taking over another company.

(True/False)

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Question 32

When a company stays inside one industry,the problems of sustaining a successful business model and strategies over time can be difficult because of changing conditions in the environment.

(True/False)

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Question 33

Horizontal integration can lead to low cost advantages but rarely to differentiation advantages.

(True/False)

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Question 34

Vertical integration can strengthen a company's differentiation business-level strategy and competitive advantage.

(True/False)

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Question 35

SparklingLeaves is one of the major suppliers of automobile tools to StanMotors,a leading automobile company.Many of the tools are customized to meet the specific needs of StanMotors and hence have little other value.In return,StanMotors has agreed to make SparklingLeaves its sole supplier of automobile equipment for a period of 15 years.This scenario illustrates:

(Multiple Choice)

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Question 36

Strategic alliances are:

(Multiple Choice)

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Question 37

Credible commitments refer to:

(Multiple Choice)

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Question 38

Long-term contracts:

(Multiple Choice)

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Question 39

John's surfboard shop has a long-term relationship with two surfboard makers.John is using:

(Multiple Choice)

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Question 40

Showing 21 - 40 of 71

Vertical integration can raise costs if,over time,a company's leaders continue to purchase inputs from company-owned suppliers even when independent suppliers can supply the same inputs at lower cost.

In 1999,two pharmaceutical companies that held an equal market share decided to pool their operations to create a new firm that was known by a different name.This is an example of a(n):

When a company outsources its noncore activities to specialists,it loses its capabilities to differentiate its final products.

A merger occurs when one company uses its capital resources,such as stock,debt,or cash,to purchase another company.

Under a competitive bidding strategy,independent component suppliers compete with each other to be the company that will be chosen to supply:

Which of the following is not a benefit of vertical integration?

Even though companies may invest in specialized assets to build competitive advantage,it is seldom necessary that suppliers do so.

How can strategic outsourcing strengthen a company's business model and increase its profitability?

Compare the benefits and risks associated with horizontal and vertical integration.Under what circumstances would a firm prefer one over the other?

Outsourcing occurs when a firm:

A company should first choose a corporate-level strategy,and then look at how changes will affect a company's current business model and strategies.

Strategic alliance is a type of long-term contract that involves one company taking over another company.

When a company stays inside one industry,the problems of sustaining a successful business model and strategies over time can be difficult because of changing conditions in the environment.

Horizontal integration can lead to low cost advantages but rarely to differentiation advantages.

Vertical integration can strengthen a company's differentiation business-level strategy and competitive advantage.

Strategic alliances are:

Credible commitments refer to:

Long-term contracts:

John's surfboard shop has a long-term relationship with two surfboard makers.John is using:

Strategic Leadership: Managing the Strategy Making Process for Competitive Advantage

External Analysis: The Identification of Opportunities and Threats

Internal Analysis: Resources and Competitive Advantage

Building Competitive Advantage Through Functional Level Strategies

Business Level Strategy

Business Level Strategy and the Industry Environment

Strategy and Technology

Strategy in the Global Environment

Corporate Level Strategy: Related and Unrelated Diversification

Corporate Performance, Governance, and Business Ethics

Implementing Strategy Through Organization

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