Exam 8: Corporate Strategy: Vertical Integration and Diversification

Hitoro Inc.developed a superior touch screen technology for tablet computers that enabled multiple users to operate the screen at the same time.The technology was leased to Revox Inc.,a consumer electronics company,for five years.Which of the following alternatives to integration does this best illustrate?

PepsiCo operates in many countries and sells a wide variety of aerated drinks,other beverages,different types of chips,and Quaker Oats goods to achieve continuous growth.From this data,we can conclude that PepsiCo has been involved in

Strategic business units that have a relatively low market share but have the potential to grow are best categorized under _____ in the Boston Consulting Group (BCG)growth-share matrix.

Investments in specialized assets tend to incur high opportunity costs because the

_____ are strategic business units that compete in a low-growth market but hold considerable market share.

How is an equity alliance different from a joint venture?

Real Goods Inc.is a large conglomerate.The company's beverages strategic business unit (SBU)has been recognized as a cash cow,and its tobacco SBU has been categorized as a dog.Which of the following can be inferred from this scenario?

PrimoDisk Inc.holds the highest market share in the low-growth compact disk industry.With the introduction of flash drives,the market for compact disks has reduced.However,PrimoDisk has been able to generate sufficient revenues for the parent company by selling its products in less developed countries.In the Boston Consulting Group (BCG)growth-share matrix,PrimoDisk will be categorized under

Which of the following stakeholders of a company would most likely be responsible for formulating a corporate strategy?

BestDrive Inc.is a large automobile company.The company's petrol cars strategic business unit (SBU)has been recognized as a cash cow,and its hybrid electric cars SBU has been categorized under stars.Which of the following can be inferred from this scenario?

White Leo Motors (WLM)Inc.generates a major portion of its revenues by manufacturing luxury sports cars.However,the company also derives an insignificant percent of its annual revenues by selling its sports merchandise that includes apparel,shoes,and other accessories under the same brand name.Which of the following terms best describes WLM?

_____ is best described as changes in an industry value chain that involve moving ownership of activities closer to the end (customer)point of the value chain.

Which of the following statements is true of internal transaction costs?

_____ is best described as an increase in the variety of products and services a firm offers or markets and the geographic regions in which it competes.

There are many reasons why firms need to grow.Which of the following reasons is strongly influenced by economies of scale?

Evara Inc.started as a luxury brand for designer apparel.Soon,the company expanded by launching its own line of premium perfumes,watches,bags,and home furnishings.This expansion allowed the businesses under the company to share a few,if not all,of the common competencies in products,services,technology,and distribution.Which of the following corporate strategies is Evara pursuing in this scenario?

Red Empire Inc.,a large multinational company owned by two partners,is active in the petroleum,capital market,chemicals,steel,beverages,hospitality,airlines,education,automobiles,and consumer electronics industries.The company has multiple brands and a large product portfolio under its banner.Which of the following terms would best describe this company?

Which of the following statements is true of transaction costs?

Which of the following alternatives on the make-or-buy continuum allows for most integration?

Virtue Products Inc.,a large conglomerate,procures a few component parts from external suppliers and also manufactures some of the key raw materials in its own subsidiaries.This apart,the company does not solely depend on outside distributors to reach its customers.In fact,it has its own retail stores to distribute its products.In this scenario,which of the following alternatives to vertical integration is Virtue Products applying?