Question 1

A fragmented industry is composed of a large number of small and medium-sized companies.

Accepted Answer

A) True 
 B)False  True

Question 2

Which of the following factors in an industry is most likely to cause excess capacity?

Accepted Answer

A)  Technologically outdated production units 
B)  High customer demand 
C)  A company's investments in newer production technology 
D)  Lack of competition from new entrants 
E)  Limited number of outlets in certain locations 
A)  Technologically outdated production units 
B)  High customer demand 
C)  A company's investments in newer production technology 
D)  Lack of competition from new entrants 
E)  Limited number of outlets in certain locations C

Question 3

Innovators and early adopters have very different customer needs from the early majority.

Accepted Answer

A) True 
 B)False  True

Question 4

Market penetration involves the creation of new and innovative products to replace existing ones.

Accepted Answer

A) True 
 B)False

Question 5

A new product's relative advantage refers to the degree to which a new product is perceived as better at satisfying customer needs than the product that it supersedes.

Accepted Answer

A) True 
 B)False

Question 6

A market growth factor that explains customers' perceptions of a new product as better at satisfying their needs than the product it replaces is called:

Accepted Answer

A)  complexity 
B)  relative advantage 
C)  compatibility 
D)  trialability 
E)  observability 
A)  complexity 
B)  relative advantage 
C)  compatibility 
D)  trialability 
E)  observability

Question 7

Which of the following is not a characteristic of a fragmented industry?

Accepted Answer

A)  Low barriers to entry 
B)  Diseconomies of scale 
C)  Brand loyalty in the industry that may primarily be local 
D)  Very specialized customer needs 
E)  Large mass-production operation 
A)  Low barriers to entry 
B)  Diseconomies of scale 
C)  Brand loyalty in the industry that may primarily be local 
D)  Very specialized customer needs 
E)  Large mass-production operation

Question 8

Which of the following statements is true about horizontal mergers?

Accepted Answer

A)  Horizontal mergers enable companies to achieve economies of scale. 
B)  Horizontal mergers result in the fragmentation of the industry. 
C)  The horizontal merger strategy has been very successful in businesses with zero cases of failure. 
D)  Companies that establish a network of distributor outlets to obtain the advantages of a low-cost postition are known as horizontal mergers. 
E)  Companies that adopt the strategy of centralization to gain control over all business units are known as horizontal mergers. 
A)  Horizontal mergers enable companies to achieve economies of scale. 
B)  Horizontal mergers result in the fragmentation of the industry. 
C)  The horizontal merger strategy has been very successful in businesses with zero cases of failure. 
D)  Companies that establish a network of distributor outlets to obtain the advantages of a low-cost postition are known as horizontal mergers. 
E)  Companies that adopt the strategy of centralization to gain control over all business units are known as horizontal mergers.

Question 9

The real estate industry is comprised of different firms in several locations. Some are independent and popular locally, while others are affiliated to national chains. The real estate industry is most likely to be a(n):

Accepted Answer

A)  fragmented industry. 
B)  oligopolies industry. 
C)  pure competition industry. 
D)  consolidated industry. 
E)  monopoly. 
A)  fragmented industry. 
B)  oligopolies industry. 
C)  pure competition industry. 
D)  consolidated industry. 
E)  monopoly.

Question 10

Early adopters are customers who purchase a new technology or product only when they are convinced that it will be around for a long time.

Accepted Answer

A) True 
 B)False

Question 11

The franchisor typically owns and funds each of its franchisees.

Accepted Answer

A) True 
 B)False

Question 12

Different strategies are often required to support and strengthen a company's business model as a market develops over time.

Accepted Answer

A) True 
 B)False

Question 13

Through chaining, companies increase their buying power, which allows them to negotiate large price reductions with their suppliers, which in turn promotes their competitive advantage.

Accepted Answer

A) True 
 B)False

Question 14

Price signaling in mature industries happens when:

Accepted Answer

A)  the government intervenes to regulate prices of products. 
B)  companies decide to invest in slow-growing markets. 
C)  companies decide to sell its patents to generate revenue. 
D)  companies increase or decrease product prices to convey their intentions to other companies. 
E)  a company concentrates on expanding market share in its existing product markets. 
A)  the government intervenes to regulate prices of products. 
B)  companies decide to invest in slow-growing markets. 
C)  companies decide to sell its patents to generate revenue. 
D)  companies increase or decrease product prices to convey their intentions to other companies. 
E)  a company concentrates on expanding market share in its existing product markets.

Question 15

Highest market demand and industry profits arise when:

Accepted Answer

A)  early adopters leave the market. 
B)  innovators and early adopters enter the market. 
C)  when laggards and late majority leave the market. 
D)  early and late majority users enter the market. 
E)  when the production costs become high. 
A)  early adopters leave the market. 
B)  innovators and early adopters enter the market. 
C)  when laggards and late majority leave the market. 
D)  early and late majority users enter the market. 
E)  when the production costs become high.

Question 16

A_____ strategy aims to help a company grow in a declining industry by picking up the market share of companies that are leaving the industry.

Accepted Answer

A)  divestment 
B)  harvest 
C)  price signaling 
D)  leadership 
E)  capacity control 
A)  divestment 
B)  harvest 
C)  price signaling 
D)  leadership 
E)  capacity control

Question 17

Hydralicious, a juice bar, has been looking to expand its business. The company has given a few entrepreneurs in different locations the license to operate under its name.The entrepreneurs have permission to use the company's reputation and the business model to run operations. The entrepreneurs will be charged a fee, but they will also get a percentage of the profits. Which of the following strategies is Hydralicious most likely to be using ?

Accepted Answer

A)  Chaining 
B)  Horizontal merger 
C)  Vertical merger 
D)  Franchising 
E)  Centralization 
A)  Chaining 
B)  Horizontal merger 
C)  Vertical merger 
D)  Franchising 
E)  Centralization

Question 18

A leadership strategy aims at growing in a declining industry by picking up the market share of companies that are leaving the industry.

Accepted Answer

A) True 
 B)False

Question 19

A harvest strategy requires the company to halt all new investments in capital equipment, advertising, research and development, and other activities that require cash flow.

Accepted Answer

A) True 
 B)False

Question 20

The strategy in a mature industry to invest in infrastructure that would be cost-prohibitive for new entrants to deter new competition from entering the market is known as:

Accepted Answer

A)  product proliferation. 
B)  technology upgrading. 
C)  market penetration. 
D)  capacity control. 
E)  product development. 
A)  product proliferation. 
B)  technology upgrading. 
C)  market penetration. 
D)  capacity control. 
E)  product development.

A fragmented industry is composed of a large number of small and medium-sized companies.

Which of the following factors in an industry is most likely to cause excess capacity?

Innovators and early adopters have very different customer needs from the early majority.

Market penetration involves the creation of new and innovative products to replace existing ones.

A new product's relative advantage refers to the degree to which a new product is perceived as better at satisfying customer needs than the product that it supersedes.

A market growth factor that explains customers' perceptions of a new product as better at satisfying their needs than the product it replaces is called:

Which of the following is not a characteristic of a fragmented industry?

Which of the following statements is true about horizontal mergers?

The real estate industry is comprised of different firms in several locations. Some are independent and popular locally, while others are affiliated to national chains. The real estate industry is most likely to be a(n):

Early adopters are customers who purchase a new technology or product only when they are convinced that it will be around for a long time.

The franchisor typically owns and funds each of its franchisees.

Different strategies are often required to support and strengthen a company's business model as a market develops over time.

Through chaining, companies increase their buying power, which allows them to negotiate large price reductions with their suppliers, which in turn promotes their competitive advantage.

Price signaling in mature industries happens when:

Highest market demand and industry profits arise when:

A_____ strategy aims to help a company grow in a declining industry by picking up the market share of companies that are leaving the industry.

A leadership strategy aims at growing in a declining industry by picking up the market share of companies that are leaving the industry.

A harvest strategy requires the company to halt all new investments in capital equipment, advertising, research and development, and other activities that require cash flow.

The strategy in a mature industry to invest in infrastructure that would be cost-prohibitive for new entrants to deter new competition from entering the market is known as:

Strategic Leadership: Managing the Strategy-Making Process for Competitive Advantage

External Analysis: The Identification of Opportunities and Threats

Internal Analysis: Resources and Competitive Advantage

Building Competitive Advantage Through Functional-Level Strategies

Business-Level Strategy

Strategy and Technology

Strategy in the Global Environment

Corporate-Level Strategy: Horizontal Integration, Vertical Integration, and Strategic Outsourcing

Corporate-Level Strategy: Related and Unrelated Diversification

Corporate Performance, Governance, and Business Ethics

Implementing Strategy Through Organization

Filters

Exam 6: Business-Level Strategy and the Industry Environment

A fragmented industry is composed of a large number of small and medium-sized companies.

Which of the following factors in an industry is most likely to cause excess capacity?

Innovators and early adopters have very different customer needs from the early majority.

Market penetration involves the creation of new and innovative products to replace existing ones.

A new product's relative advantage refers to the degree to which a new product is perceived as better at satisfying customer needs than the product that it supersedes.

A market growth factor that explains customers' perceptions of a new product as better at satisfying their needs than the product it replaces is called:

Which of the following is not a characteristic of a fragmented industry?

Which of the following statements is true about horizontal mergers?

The real estate industry is comprised of different firms in several locations. Some are independent and popular locally, while others are affiliated to national chains. The real estate industry is most likely to be a(n):

Early adopters are customers who purchase a new technology or product only when they are convinced that it will be around for a long time.

The franchisor typically owns and funds each of its franchisees.

Different strategies are often required to support and strengthen a company's business model as a market develops over time.

Through chaining, companies increase their buying power, which allows them to negotiate large price reductions with their suppliers, which in turn promotes their competitive advantage.

Price signaling in mature industries happens when:

Highest market demand and industry profits arise when:

A_____ strategy aims to help a company grow in a declining industry by picking up the market share of companies that are leaving the industry.

A leadership strategy aims at growing in a declining industry by picking up the market share of companies that are leaving the industry.

A harvest strategy requires the company to halt all new investments in capital equipment, advertising, research and development, and other activities that require cash flow.

The strategy in a mature industry to invest in infrastructure that would be cost-prohibitive for new entrants to deter new competition from entering the market is known as:

Strategic Leadership: Managing the Strategy-Making Process for Competitive Advantage

External Analysis: The Identification of Opportunities and Threats

Internal Analysis: Resources and Competitive Advantage

Building Competitive Advantage Through Functional-Level Strategies

Business-Level Strategy

Strategy and Technology

Strategy in the Global Environment

Corporate-Level Strategy: Horizontal Integration, Vertical Integration, and Strategic Outsourcing

Corporate-Level Strategy: Related and Unrelated Diversification

Corporate Performance, Governance, and Business Ethics

Implementing Strategy Through Organization

Filters