Exam 8: The Nature and Sources of Competitive Advantage

"Strategic innovation" involves:

In efficient markets, differences in ex post returns reflect either different levels of risk selected by the players or pure random factors (luck)

The simple form of the "theory of limit pricing" postulates that:

If competition in an industry has become time-based:

The growing diversity of players in the European electricity-generating industry illustrates the fact that:

A firm that decides as a long term goal to target only part of the overall market has adopted a focus strategy

Zara, the chain of retail stores owned by Inditex, illustrates:

The examples of Ikea and Southwest Airlines illustrate:

Innovation can be narrowly interpreted as technical change, but also more broadly as a sense of novelty in any area of the firm

A firm's ability to respond to change:

Competitive advantage is a relatively simple construct to understand and achieve

A first mover advantage is the attribute of the first firm entering an industry but only relates to its ability to attract the best human resources

In the long run:

For a firm to imitate the strategy of another firm, and replicate its competitive advantage, it must do four things: identify the target firm, incentivize the rival, diagnose the sources of competitive advantage, and acquire the resources needed

"Brand management" and "Lean production systems" were invented or developed respectively by:

Characteristics of the industry such as information complexity, difficulties of resource acquisition, and opportunities for deterrence and preemption, are impacting:

Being 'stuck in the middle' gives low profits because:

Preemption means reducing opportunities for challengers by::

In an efficient market, prices quickly adjust to new information

Different market types can be distinguished: