Question 1

Bargaining power rests,ultimately,on:

Accepted Answer

A) The negotiating skills of the buyer versus the seller 
B) Tradition 
C) The respective effectiveness and cohesion of top management teams 
D) The relative costs that each party would incur from walking away from the deal 
A) The negotiating skills of the buyer versus the seller 
B) Tradition 
C) The respective effectiveness and cohesion of top management teams 
D) The relative costs that each party would incur from walking away from the deal D

Question 2

For most business enterprises a market is:

Accepted Answer

A) An abstract concept-from the point of view of competition it is a continuum from a firm's closest competitor towards more distant competitors 
B) A sociological concept that is defined mainly by convention and institutions 
C) Geographical concept defined by the location of customers and competitors 
D) All the above 
A) An abstract concept-from the point of view of competition it is a continuum from a firm's closest competitor towards more distant competitors 
B) A sociological concept that is defined mainly by convention and institutions 
C) Geographical concept defined by the location of customers and competitors 
D) All the above D

Question 3

Michael Porter's five forces of competition framework links the structure of an industry to its overall level of profitability.

Accepted Answer

A) True 
 B)False  True

Question 4

Legal requirements that banks,providers of wireless telecommunication services,and taxis must obtain a government issued license before going into business impact the profitability of their respective industries:

Accepted Answer

A) Negatively because governments charge high fees for such licenses 
B) Positively because they restrict entry to the industry 
C) Negatively because such licensing is usually accompanied by regulation of prices 
D) Positively if such licenses can be sold on a secondary market 
A) Negatively because governments charge high fees for such licenses 
B) Positively because they restrict entry to the industry 
C) Negatively because such licensing is usually accompanied by regulation of prices 
D) Positively if such licenses can be sold on a secondary market

Question 5

Suppliers of technically-sophisticated components are more likely to be able to exercise supplier power than the suppliers of raw materials.

Accepted Answer

A) True 
 B)False

Question 6

The most useful approach to forecasting industry profitability in the future is:

Accepted Answer

A) To estimate the industry's revenues and costs in future years 
B) To use an industry's probability at similar stages of the business cycle in the past as an indicator of future profitability 
C) To extrapolate the trend of industry profitability into the future 
D) To understand how the industry's structure has determined competitive intensity and profitability in the past,then to use information on an industry's changing structure to predict how profitability is likely to change in the future 
A) To estimate the industry's revenues and costs in future years 
B) To use an industry's probability at similar stages of the business cycle in the past as an indicator of future profitability 
C) To extrapolate the trend of industry profitability into the future 
D) To understand how the industry's structure has determined competitive intensity and profitability in the past,then to use information on an industry's changing structure to predict how profitability is likely to change in the future

Question 7

If the Android operating system becomes the dominant platform for cell phones,its effect will be to boost the profitability of the handset industry because it is available free of charge to the handset makers.

Accepted Answer

A) True 
 B)False

Question 8

The greater the value of a product to its customers,the more profitable will it be to supply that product.

Accepted Answer

A) True 
 B)False

Question 9

Given the range of external influences that impact a firm,understanding the external environment requires managers to:

Accepted Answer

A) Use a framework or a system that allows them to organize relevant information and rank the importance of different factors 
B) Monitor competitors closely 
C) Use all existing sources and techniques to gather and analyze information 
D) Devote a large proportion of their time to this task 
A) Use a framework or a system that allows them to organize relevant information and rank the importance of different factors 
B) Monitor competitors closely 
C) Use all existing sources and techniques to gather and analyze information 
D) Devote a large proportion of their time to this task

Question 10

The American Medical Association encourages limits on the number of medical school places for training new doctors:

Accepted Answer

A) To ensure a high standard of applicant 
B) To keep class sizes small 
C) To keep doctors' remuneration high 
D) To ensure that only the best universities have medical schools 
A) To ensure a high standard of applicant 
B) To keep class sizes small 
C) To keep doctors' remuneration high 
D) To ensure that only the best universities have medical schools

Question 11

The more similar are the firms in an industry in terms of costs,strategies,and locations,the more intensely will they compete.

Accepted Answer

A) True 
 B)False

Question 12

The main reason that niche markets are often highly profitable for incumbents is because their customers tend to be insensitive to prices.

Accepted Answer

A) True 
 B)False

Question 13

Although washing machines and refrigerators are not close substitutes as far as consumers are concerned,we can consider them to be part of the same industry because of supply-side substitutability.

Accepted Answer

A) True 
 B)False

Question 14

If a firm is to create profit,the first condition is that it must supply a product for which the price the customer is willing to pay exceeds the cost incurred in supplying that product.

Accepted Answer

A) True 
 B)False

Question 15

The basic premise of industry analysis is that:

Accepted Answer

A) Perfect competition and monopoly are the basic models,most industries lie between these two extremes 
B) The level of profitability within an industry is determined by the systematic influence of the industry structure which determines the intensity of competition in the industry 
C) Industry profitability depends upon the interaction among competing firms 
D) Technology and consumer demand are the basic forces that shape industry structure 
A) Perfect competition and monopoly are the basic models,most industries lie between these two extremes 
B) The level of profitability within an industry is determined by the systematic influence of the industry structure which determines the intensity of competition in the industry 
C) Industry profitability depends upon the interaction among competing firms 
D) Technology and consumer demand are the basic forces that shape industry structure

Question 16

Which of the following does not contribute to buyers' bargaining power?

Accepted Answer

A) Low switching costs for buyers 
B) The size of buyers relative to that of sellers 
C) A high level of differentiation among the products that buyers purchase 
D) The ability of buyers to backward integrate 
A) Low switching costs for buyers 
B) The size of buyers relative to that of sellers 
C) A high level of differentiation among the products that buyers purchase 
D) The ability of buyers to backward integrate

Question 17

Economies of scale,absolute cost advantages,high capital requirements,and limited access to channels of distribution give incumbent firms an advantage over new entrants to an industry.

Accepted Answer

A) True 
 B)False

Question 18

Economic value is created when:

Accepted Answer

A) The price that the customer is willing to pay for a product exceeds the costs of the material inputs used to produce the product 
B) The surplus of value is distributed between customers and producers in the industry by the forces of competition 
C) The value of a product to consumers exceeds the price they paid for it 
D) The price that the customer is willing to pay for a product exceeds the cost of supplying it 
A) The price that the customer is willing to pay for a product exceeds the costs of the material inputs used to produce the product 
B) The surplus of value is distributed between customers and producers in the industry by the forces of competition 
C) The value of a product to consumers exceeds the price they paid for it 
D) The price that the customer is willing to pay for a product exceeds the cost of supplying it

Question 19

In identifying key success factors in an industry,it is sufficient to concentrate upon the factors which determine how customers choose between alternative suppliers.

Accepted Answer

A) True 
 B)False

Question 20

Formal,broad-based scanning of the external environment is an essential activity for all business enterprises.

Accepted Answer

A) True 
 B)False

Bargaining power rests,ultimately,on:

For most business enterprises a market is:

Michael Porter's five forces of competition framework links the structure of an industry to its overall level of profitability.

Legal requirements that banks,providers of wireless telecommunication services,and taxis must obtain a government issued license before going into business impact the profitability of their respective industries:

Suppliers of technically-sophisticated components are more likely to be able to exercise supplier power than the suppliers of raw materials.

The most useful approach to forecasting industry profitability in the future is:

If the Android operating system becomes the dominant platform for cell phones,its effect will be to boost the profitability of the handset industry because it is available free of charge to the handset makers.

The greater the value of a product to its customers,the more profitable will it be to supply that product.

Given the range of external influences that impact a firm,understanding the external environment requires managers to:

The American Medical Association encourages limits on the number of medical school places for training new doctors:

The more similar are the firms in an industry in terms of costs,strategies,and locations,the more intensely will they compete.

The main reason that niche markets are often highly profitable for incumbents is because their customers tend to be insensitive to prices.

Although washing machines and refrigerators are not close substitutes as far as consumers are concerned,we can consider them to be part of the same industry because of supply-side substitutability.

If a firm is to create profit,the first condition is that it must supply a product for which the price the customer is willing to pay exceeds the cost incurred in supplying that product.

The basic premise of industry analysis is that:

Which of the following does not contribute to buyers' bargaining power?

Economies of scale,absolute cost advantages,high capital requirements,and limited access to channels of distribution give incumbent firms an advantage over new entrants to an industry.

Economic value is created when:

In identifying key success factors in an industry,it is sufficient to concentrate upon the factors which determine how customers choose between alternative suppliers.

Formal,broad-based scanning of the external environment is an essential activity for all business enterprises.

The Concept of Strategy

Goals,values and Performance

Further Topics in Industry and Competitive Analysis

Analyzing Resources and Capabilities

Organization Structure and Management Systems: the Fundamentals of Strategy Implementation

The Sources and Dimensions of Competitive Advantage

Industry Evolution and Strategic Change

Technology-Based Industries and the Management of Innovation

Competitive Advantage in Mature Industries

Vertical Integration and the Scope of the Firm

Global Strategy and the Multinational Corporation

Diversification Strategy

Implementing Corporate Strategy: Managing the Multibusiness Firm

External Growth Strategies: Mergers,acquisitions,and Alliances

Current Trends in Strategic Management

Filters

Exam 3: Industry Analysis: the Fundamentals

Bargaining power rests,ultimately,on:

For most business enterprises a market is:

Michael Porter's five forces of competition framework links the structure of an industry to its overall level of profitability.

Legal requirements that banks,providers of wireless telecommunication services,and taxis must obtain a government issued license before going into business impact the profitability of their respective industries:

Suppliers of technically-sophisticated components are more likely to be able to exercise supplier power than the suppliers of raw materials.

The most useful approach to forecasting industry profitability in the future is:

If the Android operating system becomes the dominant platform for cell phones,its effect will be to boost the profitability of the handset industry because it is available free of charge to the handset makers.

The greater the value of a product to its customers,the more profitable will it be to supply that product.

Given the range of external influences that impact a firm,understanding the external environment requires managers to:

The American Medical Association encourages limits on the number of medical school places for training new doctors:

The more similar are the firms in an industry in terms of costs,strategies,and locations,the more intensely will they compete.

The main reason that niche markets are often highly profitable for incumbents is because their customers tend to be insensitive to prices.

Although washing machines and refrigerators are not close substitutes as far as consumers are concerned,we can consider them to be part of the same industry because of supply-side substitutability.

If a firm is to create profit,the first condition is that it must supply a product for which the price the customer is willing to pay exceeds the cost incurred in supplying that product.

The basic premise of industry analysis is that:

Which of the following does not contribute to buyers' bargaining power?

Economies of scale,absolute cost advantages,high capital requirements,and limited access to channels of distribution give incumbent firms an advantage over new entrants to an industry.

Economic value is created when:

In identifying key success factors in an industry,it is sufficient to concentrate upon the factors which determine how customers choose between alternative suppliers.

Formal,broad-based scanning of the external environment is an essential activity for all business enterprises.

The Concept of Strategy

Goals,values and Performance

Further Topics in Industry and Competitive Analysis

Analyzing Resources and Capabilities

Organization Structure and Management Systems: the Fundamentals of Strategy Implementation

The Sources and Dimensions of Competitive Advantage

Industry Evolution and Strategic Change

Technology-Based Industries and the Management of Innovation

Competitive Advantage in Mature Industries

Vertical Integration and the Scope of the Firm

Global Strategy and the Multinational Corporation

Diversification Strategy

Implementing Corporate Strategy: Managing the Multibusiness Firm

External Growth Strategies: Mergers,acquisitions,and Alliances

Current Trends in Strategic Management

Filters