Exam 6: Developing an Effective Business Model

An arrangement between two or more firms that establishes an exchange relationship but has no joint ownership involved is called a:

A business model is a firm's plan or diagram for how it competes, uses its resources, structures its relationships, interfaces with customers, and creates value to sustain itself on the basis of the profits it earns.

Organizations (typically nonprofit) that are formed by firms in the same industry to collect and disseminate trade information, offer legal and technical advice, furnish industry-related training, and provide a platform for collective lobbying.

The process of adapting a company's core competencies to exploit new opportunities is referred to as resource conversion.

According to the textbook, by studying a product's or service's value chain an organization can:

________ involves all the activities required to manufacture a product.

Which of the following is not one of the purposes of a business model?

A hub and wheel configuration with a local firm at the hub organizing the interdependencies of a complex array of firm is referred to as a:

Which of the following is a "support" activity in the value chain?

In a business model context, the three components of a firm's customer interface are target customer, fulfillment and support, and:

Jennifer Barnes has just finished writing a business plan for a startup in the medical products industry. She has now reached the point where she needs to develop a plan for how her firm will compete, use its resources, structure its relationships, interface with customers, and create value to sustain itself on the basis of the profits it earns. Jennifer needs to establish her firm's:

Strategic assets are anything rare and valuable that a firm owns.

Which of the following is a "primary" activity in the value chain?

A firm's ________ is the limited group of individuals or businesses that it goes after or tries to appeal to.

Companies ultimately try to combine their core competencies and strategic assets to create a sustainable competitive advantage.

Two fatal flaws can render a business model untenable from the beginning. These are utterly unsound economics and:

Almost all firms partner with others to make their business models work.

Two fatal flaws can render a business model untenable from the beginning. These are:

Gary Smith just launched a firm in the sports drink industry. He has decided to focus his efforts on appealing to extreme sports enthusiasts (examples include hang gliders, rock climbers, and parachutists). In Gary's case, extreme sports enthusiasts represent his firm's:

Historically, it has been difficult for a new venture to use a cost leadership strategy.