Exam 8: The Nature and Sources of Competitive Advantage

The ability to buy capabilities depends on:

The theory of limit pricing postulates that a firm in a strong market position sets prices that create profits which just fail to attract entrants

Three different market types lead to different categories of competitive advantage. These three markets are: trading markets, service markets, and production markets

To transfer or acquire resources a firm will face transaction costs including patent costs, negotiation costs and contract enforcement cost

If a firm's competitive advantage comes from external change, then:

Competitive advantage:

Isolating mechanisms are:

Examples of "efficient markets" are:

A "Blue ocean strategy" refers to the creation of entirely new industries, or the recreation of existing industries

An example of "patterns of price movements" is:

Is Differentiation a superior strategy than a Cost strategy because customers prefer to pay a higher price for better quality?

The tobacco and the toy industries illustrate:

For a competitive advantage to exist:

Is it easy for Sears Holdings (Kmart) to understand Wal-Mart's competitive advantages?

The fundamental choice for capability acquisitions is the decision to either:

A firm with a competitive advantage other than superior profitability may have?

The simple trade-off between high-quality and low cost:

Systematic behavioral trends can be defined as the:

To "preempt" an entrant, a firm can occupy existing and potential strategic niches to reduce the range of opportunities open to potential entrants

According to Porter, cost leadership and differentiation are: