Exam 2: Evaluating a Firms External Environment

All of the following are elements of the general environment except

In general, it is rarely the case that all five forces in the five forces framework will be equally threatening at the same time.

What is a harvest strategy?

________ are advantages that come to firms that make important strategic and technological decisions early in the development of an industry.

In the S-C-P model, ________ refers to the strategies that firms in an industry implement.

The most promising opportunity for a firm in a declining industry is to

It is possible for a single firm to be a complementor of one firm and a competitor of another.

Within the five forces framework, when all five threats are very high, competition in the industry begins to approach a monopoly.

A consolidation strategy is a good option in what type of industry?

Firms that have either recently begun operations in an industry or that threaten to begin operations in an industry soon are considered to be ________ in the five forces framework.

If you were to purchase a new Apple iPod and were unable to use your previously downloaded library of digital music with your new iPod, this would be an example of a customer-switching cost you would incur to use Apple's product.

What are customer-switching costs?

Overall, the average level of performance in an industry is likely to be highest when

If the owner of a jewelry store who normally purchased diamonds from a diamond brokerage firm were to open his own diamond brokerage firm, this would be an example of forward vertical integration.

In the structure-conduct-performance model, the term "structure" refers to industry structure, which can be measured by such factors as the number of competitors in an industry.

An emerging industry is an industry in which a large number of small or medium-sized firms operate and no small set of firms has a dominant market share or creates dominant technologies.

A(n) ________ is any individual, group, or organization outside a firm that seeks to reduce the level of that firm's performance.

A firm following a niche strategy in a declining industry reduces its scope of operations and focuses on narrow segments of the declining industry.

In a perfectly competitive industry,

Hickory Divine is one of the leading manufacturers in the hardwood furniture industry. Hickory Divine has many small competitors, none of which controls a significant portion of the industry. Hickory, like most of the furniture manufacturers, sells its products to a broad variety of small furniture stores throughout the country, none of which represents a large percentage of Hickory's sales. When purchasing the products it uses for manufacturing its furniture, Hickory is able to choose from many suppliers since the wood it uses is an undifferentiated commodity, and Hickory is able to easily switch to any supplier that has the best price and delivery times. While growth in the hardwood furniture industry has historically been in the double digits, the industry growth rate has slowed considerably into the single digits, to approximately 5% in recent years; consumers have been purchasing less expensive furniture made of composite wood that is considerably less expensive than hardwood furniture but that looks and functions very similarly once it is painted. -The threat of buyers in this industry is best described as