Question 1

In which of the following industry competitive structures do selling firms have the lowest pricing power?

Accepted Answer

A)  monopolistic competition 
B)  monopoly 
C)  oligopoly 
D)  perfect competition 
A)  monopolistic competition 
B)  monopoly 
C)  oligopoly 
D)  perfect competition

Question 2

How is a firm's task environment different from its general environment?

Accepted Answer

A)  Managers have some influence over external factors in the task environment; they have little direct effect over external forces in the general environment. 
B)  Managers have no direct effect over external factors in the task environment; they have some influence over external forces in the general environment. 
C)  Managers have no direct effect over external factors in the task environment; they have influence over all external forces in the general environment. 
D)  Managers have influence over all external factors in the task environment; they have no direct effect over external forces in the general environment. 
A)  Managers have some influence over external factors in the task environment; they have little direct effect over external forces in the general environment. 
B)  Managers have no direct effect over external factors in the task environment; they have some influence over external forces in the general environment. 
C)  Managers have no direct effect over external factors in the task environment; they have influence over all external forces in the general environment. 
D)  Managers have influence over all external factors in the task environment; they have no direct effect over external forces in the general environment.

Question 3

During periods of high industry growth

Accepted Answer

A)  price competition among firms frequently decreases. 
B)  rivals are focused on taking market share away from one another. 
C)  firms indulge in intense promotional campaigns. 
D)  new product releases with minor modifications become common. 
A)  price competition among firms frequently decreases. 
B)  rivals are focused on taking market share away from one another. 
C)  firms indulge in intense promotional campaigns. 
D)  new product releases with minor modifications become common.

Question 4

Which of the following is a primary feature of the five forces model?

Accepted Answer

A)  It is concerned exclusively about the intensity of rivalry among direct competitors. 
B)  It takes into account a firm's internal resources, capabilities, and core competencies. 
C)  It helps managers determine the changing speed of an industry or the rate of innovation. 
D)  It views competition within an industry broadly to include forces such as buyers, suppliers, and the threat of substitutes. 
A)  It is concerned exclusively about the intensity of rivalry among direct competitors. 
B)  It takes into account a firm's internal resources, capabilities, and core competencies. 
C)  It helps managers determine the changing speed of an industry or the rate of innovation. 
D)  It views competition within an industry broadly to include forces such as buyers, suppliers, and the threat of substitutes.

Question 5

_____ are best described as industry-specific factors that separate one strategic group from another.

Accepted Answer

A)  Mobility barriers 
B)  Excise duties 
C)  Embargoes 
D)  Learning effects 
A)  Mobility barriers 
B)  Excise duties 
C)  Embargoes 
D)  Learning effects

Question 6

Which of the following is a characteristic of a fragmented industry?

Accepted Answer

A)  The entry barriers are high. 
B)  There are many small firms. 
C)  Firms tend to have high profitability. 
D)  Firms have substantial pricing power. 
A)  The entry barriers are high. 
B)  There are many small firms. 
C)  Firms tend to have high profitability. 
D)  Firms have substantial pricing power.

Question 7

Which of the following do the sociocultural forces in a firm's external environment best represent?

Accepted Answer

A)  the interest rates prevalent in an economy 
B)  the laws protecting small enterprises in a nation 
C)  the family size of the firm's target market 
D)  the rate of employee attrition within the firm 
A)  the interest rates prevalent in an economy 
B)  the laws protecting small enterprises in a nation 
C)  the family size of the firm's target market 
D)  the rate of employee attrition within the firm

Question 8

While implementing strategic group mapping for the U.S.domestic airline industry,two strategic groups become apparent: low-cost,point-to-point airlines (Virgin Atlantic,Alaska Airlines,JetBlue,and Southwest Airlines)versus differentiated airlines using a hub-and-spoke system (American,Delta,and United).Which of the following statements is true about these two strategic groups?

Accepted Answer

A)  Competitive rivalry between Virgin Atlantic and JetBlue is likely to be higher than that between American and Southwest Airlines. 
B)  American, United, and Delta Airlines will be affected differently by Porter's five competitive forces. 
C)  Alaska Airlines and Delta Airlines will be affected by the external environment in very similar ways. 
D)  Competitive rivalry between Virgin Atlantic and Delta Airlines is likely to be higher than that between American, Delta, and United. 
A)  Competitive rivalry between Virgin Atlantic and JetBlue is likely to be higher than that between American and Southwest Airlines. 
B)  American, United, and Delta Airlines will be affected differently by Porter's five competitive forces. 
C)  Alaska Airlines and Delta Airlines will be affected by the external environment in very similar ways. 
D)  Competitive rivalry between Virgin Atlantic and Delta Airlines is likely to be higher than that between American, Delta, and United.

Question 9

When companies that manufacture shipping containers want to buy iron ore,the purchase decision is solely based on price.This is because there are a large number of sellers in the iron ore industry,and iron ore is a highly undifferentiated commodity.Which of the following industry competitive structures does the iron ore industry best illustrate?

Accepted Answer

A)  monopoly 
B)  oligopoly 
C)  perfect competition 
D)  monopolistic competition 
A)  monopoly 
B)  oligopoly 
C)  perfect competition 
D)  monopolistic competition

Question 10

Which of the following is the best characterization of sociocultural forces?

Accepted Answer

A)  a firm's culture, norms, and values 
B)  a society's culture, norms, and values 
C)  a competitor's culture, norms, and values 
D)  a focus group's culture, norms, and values 
A)  a firm's culture, norms, and values 
B)  a society's culture, norms, and values 
C)  a competitor's culture, norms, and values 
D)  a focus group's culture, norms, and values

Question 11

When applying the five forces model,the first step should ideally be

Accepted Answer

A)  drawing a strategic-group map. 
B)  identify the underlying drivers of each force. 
C)  assessing the overall industry structure. 
D)  defining the relevant industry. 
A)  drawing a strategic-group map. 
B)  identify the underlying drivers of each force. 
C)  assessing the overall industry structure. 
D)  defining the relevant industry.

Question 12

In an industry,the rivalry among existing competitors is high when

Accepted Answer

A)  fixed costs are low and marginal costs are high. 
B)  exit barriers are low. 
C)  incumbent firms are highly committed to the business. 
D)  industry growth is high. 
A)  fixed costs are low and marginal costs are high. 
B)  exit barriers are low. 
C)  incumbent firms are highly committed to the business. 
D)  industry growth is high.

Question 13

Given the industry structure in the automobile business,entering the auto manufacturing industry doesn't seem advisable.Yet Tesla Motors is joining the fray.Rather than attempting to compete head-on in internal combustion engines,Tesla Motors is entering the all-electric car segment,a much less crowded niche in the overall car industry.Which of the following is Tesla most hoping to benefit from in this market niche?

Accepted Answer

A)  network effects 
B)  economies of scale 
C)  customer switching costs 
D)  capital requirements 
A)  network effects 
B)  economies of scale 
C)  customer switching costs 
D)  capital requirements

Question 14

In the step-by-step process of industry analysis,identifying the underlying drivers of each force is followed by

Accepted Answer

A)  drawing a strategicgroup map. 
B)  assessing the overall industry structure. 
C)  identifying key players in each of the five forces. 
D)  defining the relevant industry. 
A)  drawing a strategicgroup map. 
B)  assessing the overall industry structure. 
C)  identifying key players in each of the five forces. 
D)  defining the relevant industry.

Question 15

Why do companies use strategic group models?

Accepted Answer

A)  to reveal product differences between firms in the same industry 
B)  to reveal potential areas of industry convergence between firms in different industries 
C)  to reveal common threads between firms in different industries 
D)  to reveal performance differences between clusters of firms in the same industry 
A)  to reveal product differences between firms in the same industry 
B)  to reveal potential areas of industry convergence between firms in different industries 
C)  to reveal common threads between firms in different industries 
D)  to reveal performance differences between clusters of firms in the same industry

Question 16

The Beacon is a newspaper that sold print copies of its paper in a medium-sized town in Kansas for more than 100 years.Recently,the Beacon signed a deal with IntelNews Inc.to present the paper digitally to homes and businesses.This example shows

Accepted Answer

A)  a monopoly. 
B)  an oligarchy. 
C)  monopolistic competition. 
D)  an industry convergence. 
A)  a monopoly. 
B)  an oligarchy. 
C)  monopolistic competition. 
D)  an industry convergence.

Question 17

In the _____ developed by Michael Porter,competition is not defined narrowly as a firm's closest competitors but rather more broadly to include other factors in an industry like buyers,suppliers,potential new entry of other firms,and the threat of substitutes.

Accepted Answer

A)  PESTEL framework 
B)  VRIO framework 
C)  five forces model 
D)  value chain analysis 
A)  PESTEL framework 
B)  VRIO framework 
C)  five forces model 
D)  value chain analysis

Question 18

Which of the following statements with regard to industry structures is true?

Accepted Answer

A)  They are stable over time, not dynamic. 
B)  Having a large number of competitors generally equates to higher industry profitability. 
C)  A consolidated industry tends to be more profitable than a fragmented one. 
D)  Having few but large competitors increases the threat of strong competitive forces such as supplier or buyer power. 
A)  They are stable over time, not dynamic. 
B)  Having a large number of competitors generally equates to higher industry profitability. 
C)  A consolidated industry tends to be more profitable than a fragmented one. 
D)  Having few but large competitors increases the threat of strong competitive forces such as supplier or buyer power.

Question 19

Soapsuds Inc.,a manufacturer of cleaning agents,supplies its products to All Needs Inc.,a supermarket chain.It demands that All Needs create more shelf space in its stores for Soapsuds' products.However,All Needs Inc.refuses to do this.Instead,it decides to produce its own range of cleaning agents with its own label "All Wash." In this scenario,All Needs Inc.has exercised its bargaining power as a buyer through

Accepted Answer

A)  forward integration. 
B)  product differentiation. 
C)  crowdsourcing. 
D)  backward integration. 
A)  forward integration. 
B)  product differentiation. 
C)  crowdsourcing. 
D)  backward integration.

Question 20

When fashion magazines face competition from fashion blogs on the web,which of the following forces in Michael Porter's five forces model primarily gets stronger?

Accepted Answer

A)  the emergence of entry barriers 
B)  the bargaining power of suppliers 
C)  the availability of complements 
D)  the threat of substitutes 
A)  the emergence of entry barriers 
B)  the bargaining power of suppliers 
C)  the availability of complements 
D)  the threat of substitutes

In which of the following industry competitive structures do selling firms have the lowest pricing power?

How is a firm's task environment different from its general environment?

During periods of high industry growth

Which of the following is a primary feature of the five forces model?

_____ are best described as industry-specific factors that separate one strategic group from another.

Which of the following is a characteristic of a fragmented industry?

Which of the following do the sociocultural forces in a firm's external environment best represent?

Which of the following is the best characterization of sociocultural forces?

When applying the five forces model,the first step should ideally be

In an industry,the rivalry among existing competitors is high when

In the step-by-step process of industry analysis,identifying the underlying drivers of each force is followed by

Why do companies use strategic group models?

The Beacon is a newspaper that sold print copies of its paper in a medium-sized town in Kansas for more than 100 years.Recently,the Beacon signed a deal with IntelNews Inc.to present the paper digitally to homes and businesses.This example shows

In the _____ developed by Michael Porter,competition is not defined narrowly as a firm's closest competitors but rather more broadly to include other factors in an industry like buyers,suppliers,potential new entry of other firms,and the threat of substitutes.

Which of the following statements with regard to industry structures is true?

When fashion magazines face competition from fashion blogs on the web,which of the following forces in Michael Porter's five forces model primarily gets stronger?

What Is Strategy

Strategic Leadership: Managing the Strategy Process

Internal Analysis: Resources, Capabilities, and Core Competencies

Competitive Advantage, Firm Performance, and Business Models

Business Strategy: Differentiation, Cost Leadership, and Blue Oceans

Business Strategy: Innovation and Entrepreneurship

Corporate Strategy: Vertical Integration and Diversification

Corporate Strategy: Strategic Alliances, Mergers and Acquisitions

Global Strategy: Competing Around the World

Organizational Design: Structure, Culture, and Control

Corporate Governance and Business Ethics

Filters

Exam 3: External Analysis: Industry Structure, Competitive Forces, and Strategic Groups

In which of the following industry competitive structures do selling firms have the lowest pricing power?

How is a firm's task environment different from its general environment?

During periods of high industry growth

Which of the following is a primary feature of the five forces model?

_____ are best described as industry-specific factors that separate one strategic group from another.

Which of the following is a characteristic of a fragmented industry?

Which of the following do the sociocultural forces in a firm's external environment best represent?

Which of the following is the best characterization of sociocultural forces?

When applying the five forces model,the first step should ideally be

In an industry,the rivalry among existing competitors is high when

In the step-by-step process of industry analysis,identifying the underlying drivers of each force is followed by

Why do companies use strategic group models?

The Beacon is a newspaper that sold print copies of its paper in a medium-sized town in Kansas for more than 100 years.Recently,the Beacon signed a deal with IntelNews Inc.to present the paper digitally to homes and businesses.This example shows

In the _____ developed by Michael Porter,competition is not defined narrowly as a firm's closest competitors but rather more broadly to include other factors in an industry like buyers,suppliers,potential new entry of other firms,and the threat of substitutes.

Which of the following statements with regard to industry structures is true?

When fashion magazines face competition from fashion blogs on the web,which of the following forces in Michael Porter's five forces model primarily gets stronger?

What Is Strategy

Strategic Leadership: Managing the Strategy Process

Internal Analysis: Resources, Capabilities, and Core Competencies

Competitive Advantage, Firm Performance, and Business Models

Business Strategy: Differentiation, Cost Leadership, and Blue Oceans

Business Strategy: Innovation and Entrepreneurship

Corporate Strategy: Vertical Integration and Diversification

Corporate Strategy: Strategic Alliances, Mergers and Acquisitions

Global Strategy: Competing Around the World

Organizational Design: Structure, Culture, and Control

Corporate Governance and Business Ethics

Filters