Question 1

A sustained competitive advantage is virtually permanent.

Accepted Answer

A) True 
 B)False

Question 2

A firm's ________ is a measure of its competitive advantage calculated using information from a firm's published profit and loss and balance sheet statements.

Accepted Answer

A)  economic performance 
B)  accounting performance 
C)  strategic performance 
D)  sustainable performance 
A)  economic performance 
B)  accounting performance 
C)  strategic performance 
D)  sustainable performance

Question 3

The second step in the strategic management process is the definition of a firm's mission.

Accepted Answer

A) True 
 B)False

Question 4

A firm's mission defines both what it wants to be in the long run and what it wants to avoid in the meantime.

Accepted Answer

A) True 
 B)False

Question 5

For the purposes of this book, a firm's strategy is defined as its theory about how to gain competitive advantages.

Accepted Answer

A) True 
 B)False

Question 6

Actions firms take to gain competitive advantages in a single market or industry are known as

Accepted Answer

A)  business level strategies. 
B)  corporate level strategies. 
C)  functional level strategies. 
D)  sustainable strategies. 
A)  business level strategies. 
B)  corporate level strategies. 
C)  functional level strategies. 
D)  sustainable strategies.

Question 7

Firms that create the same economic value as their rivals experience competitive

Accepted Answer

A)  disadvantage. 
B)  parity. 
C)  superiority. 
D)  advantage. 
A)  disadvantage. 
B)  parity. 
C)  superiority. 
D)  advantage.

Question 8

Firms that generate less economic value than their rivals experience a competitive

Accepted Answer

A)  advantage. 
B)  parity. 
C)  disadvantage. 
D)  preference. 
A)  advantage. 
B)  parity. 
C)  disadvantage. 
D)  preference.

Question 9

Corporate level strategies are actions firms take to gain competitive advantages in a single market or industry.

Accepted Answer

A) True 
 B)False

Question 10

Discuss the nature of a sustainable competitive advantage. In your answer, identify when a firm has a competitive advantage, define the term "economic value" and distinguish between a temporary competitive advantage and a sustainable competitive advantage.

Accepted Answer

In general, a firm has a competitive adv

Question 11

Johnson & Johnson's introduction of "Johnson's Toilet and Baby Powder" as a result of customers asking to purchase the talcum powder is an example of a planned strategy.

Accepted Answer

A) True 
 B)False

Question 12

Define strategy implementation and discuss three specific organizational policies and practices that are particularly important in implementing a strategy.

Accepted Answer

Strategy implementation occurs when a fi

Question 13

________ are specific measurable targets a firm can use to evaluate the extent to which it is realizing its mission.

Accepted Answer

A)  Visions 
B)  Missions 
C)  Competitive advantages 
D)  Objectives 
A)  Visions 
B)  Missions 
C)  Competitive advantages 
D)  Objectives

Question 14

Economic measures of competitive advantage compare a firm's level of return to its costs of capital instead of to the average level of return to the industry.

Accepted Answer

A) True 
 B)False

Question 15

Visionary firms earn substantially higher returns than average firms because they acknowledge that profit maximizing is their primary reason for existence.

Accepted Answer

A) True 
 B)False

Question 16

Green Frog is an environmentally friendly firm in the cosmetics industry. If Green Frog undertook an analysis to help it understand which of its resources and capabilities are likely to be sources of competitive advantage and which are less likely to sources of such advantages it would be performing a(n)

Accepted Answer

A)  internal analysis. 
B)  external analysis. 
C)  WACC analysis. 
D)  economic analysis. 
A)  internal analysis. 
B)  external analysis. 
C)  WACC analysis. 
D)  economic analysis.

Question 17

Missions are often written in the form of

Accepted Answer

A)  vision statements. 
B)  mission statements. 
C)  corporate objectives. 
D)  organizational goals. 
A)  vision statements. 
B)  mission statements. 
C)  corporate objectives. 
D)  organizational goals.

Question 18

The ________ is the rate of return that a firm promises to pay its suppliers of capital to induce them to invest in the firm.

Accepted Answer

A)  cost of debt 
B)  cost of advantage 
C)  cost of parity 
D)  cost of capital 
A)  cost of debt 
B)  cost of advantage 
C)  cost of parity 
D)  cost of capital

Question 19

The greatest disadvantage of accounting measures of competitive performance is that they are relatively difficult to compute.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following statements regarding firm mission is accurate?

Accepted Answer

A)  While some firms have used their missions to develop strategies that create significant competitive advantages, firm missions can hurt a firm's performance as well. 
B)  Virtually all firms have used missions to develop strategies that create significant competitive advantages, while very few firms have used missions that can hurt their performance. 
C)  It is very rare for firms to be able to use their missions to develop strategies that create significant competitive advantages, and most firm missions actually hurt their performance. 
D)  Missions tend to have very little impact on a firm's ability to create significant competitive advantages. 
A)  While some firms have used their missions to develop strategies that create significant competitive advantages, firm missions can hurt a firm's performance as well. 
B)  Virtually all firms have used missions to develop strategies that create significant competitive advantages, while very few firms have used missions that can hurt their performance. 
C)  It is very rare for firms to be able to use their missions to develop strategies that create significant competitive advantages, and most firm missions actually hurt their performance. 
D)  Missions tend to have very little impact on a firm's ability to create significant competitive advantages.

A sustained competitive advantage is virtually permanent.

A firm's ________ is a measure of its competitive advantage calculated using information from a firm's published profit and loss and balance sheet statements.

The second step in the strategic management process is the definition of a firm's mission.

A firm's mission defines both what it wants to be in the long run and what it wants to avoid in the meantime.

For the purposes of this book, a firm's strategy is defined as its theory about how to gain competitive advantages.

Actions firms take to gain competitive advantages in a single market or industry are known as

Firms that create the same economic value as their rivals experience competitive

Firms that generate less economic value than their rivals experience a competitive

Corporate level strategies are actions firms take to gain competitive advantages in a single market or industry.

Discuss the nature of a sustainable competitive advantage. In your answer, identify when a firm has a competitive advantage, define the term "economic value" and distinguish between a temporary competitive advantage and a sustainable competitive advantage.

Johnson & Johnson's introduction of "Johnson's Toilet and Baby Powder" as a result of customers asking to purchase the talcum powder is an example of a planned strategy.

Define strategy implementation and discuss three specific organizational policies and practices that are particularly important in implementing a strategy.

________ are specific measurable targets a firm can use to evaluate the extent to which it is realizing its mission.

Economic measures of competitive advantage compare a firm's level of return to its costs of capital instead of to the average level of return to the industry.

Visionary firms earn substantially higher returns than average firms because they acknowledge that profit maximizing is their primary reason for existence.

Missions are often written in the form of

The ________ is the rate of return that a firm promises to pay its suppliers of capital to induce them to invest in the firm.

The greatest disadvantage of accounting measures of competitive performance is that they are relatively difficult to compute.

Which of the following statements regarding firm mission is accurate?

Evaluating a Firms External Environment

Evaluating a Firms Internal Capabilities

Cost Leadership

Product Differentiation

Vertical Integration

Corporate Diversification

Organizing to Implement Corporate Diversification

Strategic Alliances

Mergers and Acquisitions

International Strategies

Filters

Exam 1: What Is Strategy and the Strategic Management Process

A sustained competitive advantage is virtually permanent.

A firm's ________ is a measure of its competitive advantage calculated using information from a firm's published profit and loss and balance sheet statements.

The second step in the strategic management process is the definition of a firm's mission.

A firm's mission defines both what it wants to be in the long run and what it wants to avoid in the meantime.

For the purposes of this book, a firm's strategy is defined as its theory about how to gain competitive advantages.

Actions firms take to gain competitive advantages in a single market or industry are known as

Firms that create the same economic value as their rivals experience competitive

Firms that generate less economic value than their rivals experience a competitive

Corporate level strategies are actions firms take to gain competitive advantages in a single market or industry.

Discuss the nature of a sustainable competitive advantage. In your answer, identify when a firm has a competitive advantage, define the term "economic value" and distinguish between a temporary competitive advantage and a sustainable competitive advantage.

Johnson & Johnson's introduction of "Johnson's Toilet and Baby Powder" as a result of customers asking to purchase the talcum powder is an example of a planned strategy.

Define strategy implementation and discuss three specific organizational policies and practices that are particularly important in implementing a strategy.

________ are specific measurable targets a firm can use to evaluate the extent to which it is realizing its mission.

Economic measures of competitive advantage compare a firm's level of return to its costs of capital instead of to the average level of return to the industry.

Visionary firms earn substantially higher returns than average firms because they acknowledge that profit maximizing is their primary reason for existence.

Missions are often written in the form of

The ________ is the rate of return that a firm promises to pay its suppliers of capital to induce them to invest in the firm.

The greatest disadvantage of accounting measures of competitive performance is that they are relatively difficult to compute.

Which of the following statements regarding firm mission is accurate?

Evaluating a Firms External Environment

Evaluating a Firms Internal Capabilities

Cost Leadership

Product Differentiation

Vertical Integration

Corporate Diversification

Organizing to Implement Corporate Diversification

Strategic Alliances

Mergers and Acquisitions

International Strategies

Filters