Exam 5: Business- and Functional-Level Strategy

A low-cost firm will try to avoid numerous production variations and seek to minimize customization, as both of these add cost to the product that they may not be able to pass along to customers.

A firm that allows each market to adapt to the local conditions and pursue the strategy they choose best in that local market is using a multi-domestic strategy.

_____ keep firms in an industry and thus can exert downward pressure on profits.

Which of the following is NOT an example of substitute products?

Which of the following statements about a global strategy is false?

If a low-tax entity can charge a low transfer price on a product shipped to a high-tax environment, then the company can reduce its overall taxes.

A firm that allows each market to adapt to the local conditions and pursue the strategy they choose best in that local market is using a:

Typically, a firm pursuing a transnational strategy will determine how much flexibility is to be allowed in a given nation.

_____ occur when a firm enjoys declining unit costs as production increases over a relevant range of time.

Which of the following statements about the U.S. GAAP is true?

What is the concern with labor?

The breadth of products a firm will offer, such as the range of customers and/or distributors sold to, and the geographic region the firm will cover is known as competitive scope.

Which of the following is typically the force that has the greatest impact in the Five Forces model?

The reaction of the existing firms in an industry can affect the ability of others to enter.

What is the benefit of using a multi-domestic strategy?

Firms with a focused strategy:

With a focused strategy, a firm will try to serve a particular type of customer, a particular distribution channel, and a geographic region, often with only one product.

If a firm chooses to compete in the same manner in all countries, it is called a:

Low-cost strategies can be used for products, but not for services.

Firms with high market share are the only ones that are most profitable.