Question 1

According to Porter, what are the two key factors affecting the economic logic of competitive advantage?

Accepted Answer

According to Porter, two key factors affect the economic logic of competitive advantage. These alternative sources of advantage are having a lower cost structure than industry competitors and having a product or service that customers perceive as differentiated from other products in the industry to the point that they will pay higher prices than what is charged for other products in the industry.

Question 2

Learning and economies of scope are both drivers of the differentiation strategic position.

Accepted Answer

A) True 
 B)False  False

Question 3

When a company is acquired by another, but still operates independently, it operates as a(n) ________.

Accepted Answer

A)  strategic business unit 
B)  separate company 
C)  independent entity 
D)  subsidiary independent company 
A)  strategic business unit 
B)  separate company 
C)  independent entity 
D)  subsidiary independent company A

Question 4

Different production technologies result in similar costs.

Accepted Answer

A) True 
 B)False

Question 5

The levers that are necessary for implementing a firm's strategy include all but having ________.

Accepted Answer

A)  appropriate systems and processes 
B)  sufficient managerial resources 
C)  five- and ten-year business forecasts 
D)  incentives that are congruent with objectives 
A)  appropriate systems and processes 
B)  sufficient managerial resources 
C)  five- and ten-year business forecasts 
D)  incentives that are congruent with objectives

Question 6

A successful differentiation position requires that a firm satisfy all but which of the following criteria?

Accepted Answer

A)  one or more buyer needs in a manner superior to competitors. 
B)  customers so that they pay higher prices for the added points of differentiation 
C)  the requirement of perceived uniqueness about the product that attracts customers 
D)  competitive pricing 
A)  one or more buyer needs in a manner superior to competitors. 
B)  customers so that they pay higher prices for the added points of differentiation 
C)  the requirement of perceived uniqueness about the product that attracts customers 
D)  competitive pricing

Question 7

Mercedes Benz is the world's leading manufacturer of premium passenger cars because it has a reputation for all but which of the following?

Accepted Answer

A)  producing cars at the fastest rate in the industry 
B)  innovative engineering 
C)  styling that appeals to buyers who will pay premium prices 
D)  effective safety features 
A)  producing cars at the fastest rate in the industry 
B)  innovative engineering 
C)  styling that appeals to buyers who will pay premium prices 
D)  effective safety features

Question 8

As industries enter periods of rapid growth, early movers are virtually guaranteed rapid growth.

Accepted Answer

A) True 
 B)False

Question 9

Differentiation may fail because of all of the following except ________.

Accepted Answer

A)  underfulfillment 
B)  overfulfillment 
C)  ease of imitation 
D)  unusually high quality 
A)  underfulfillment 
B)  overfulfillment 
C)  ease of imitation 
D)  unusually high quality

Question 10

Pacific Cycle markets a product for virtually every market segment, offers a range of quality in its product mix, and keeps costs down by ________.

Accepted Answer

A)  eliminating middle management in the firm 
B)  using American labor from a low-wage state 
C)  outsourcing all of its production to Asia 
D)  taking orders for sample merchandise 
A)  eliminating middle management in the firm 
B)  using American labor from a low-wage state 
C)  outsourcing all of its production to Asia 
D)  taking orders for sample merchandise

Question 11

Variable costs are the costs of ________.

Accepted Answer

A)  raw materials and labor 
B)  the last unit of production 
C)  rent and equipment 
D)  all expenses incurred by the firm 
A)  raw materials and labor 
B)  the last unit of production 
C)  rent and equipment 
D)  all expenses incurred by the firm

Question 12

Firms that produce differentiated products usually have difficulties managing costs.

Accepted Answer

A) True 
 B)False

Question 13

Two firms of the same size may have significantly different operating costs because one has progressed farther down the learning curve.

Accepted Answer

A) True 
 B)False

Question 14

It is necessary to have both financial and human capital resources to successfully pull off a firm's strategy.

Accepted Answer

A) True 
 B)False

Question 15

If a firm's strategy can be implemented, then it must be aligned with the appropriate implementation levers.

Accepted Answer

A) True 
 B)False

Question 16

Focused differentiation targets unique products to relatively small segments.

Accepted Answer

A) True 
 B)False

Question 17

The Economic Logic vs Scope of Arena model identifies four generic strategic positions that result from a firm's starting strategic position. Which is not one of these four positions?

Accepted Answer

A)  broad differentiation 
B)  focused cost leadership 
C)  focused differentiation 
D)  narrow differentiation 
A)  broad differentiation 
B)  focused cost leadership 
C)  focused differentiation 
D)  narrow differentiation

Question 18

Focus positions may fail because of all of the following except ________.

Accepted Answer

A)  trying to meet the needs of too many customers 
B)  straddling inconsistent positions 
C)  being out-focused by competitors 
D)  attempting to grow beyond the niche 
A)  trying to meet the needs of too many customers 
B)  straddling inconsistent positions 
C)  being out-focused by competitors 
D)  attempting to grow beyond the niche

Question 19

As production experience is gained, incremental production costs increase at a constant rate.

Accepted Answer

A) True 
 B)False

Question 20

Name the four positions included in Porter's concept of generic strategies.

Accepted Answer

The four positions are low cos

According to Porter, what are the two key factors affecting the economic logic of competitive advantage?

Learning and economies of scope are both drivers of the differentiation strategic position.

When a company is acquired by another, but still operates independently, it operates as a(n) ________.

Different production technologies result in similar costs.

The levers that are necessary for implementing a firm's strategy include all but having ________.

A successful differentiation position requires that a firm satisfy all but which of the following criteria?

Mercedes Benz is the world's leading manufacturer of premium passenger cars because it has a reputation for all but which of the following?

As industries enter periods of rapid growth, early movers are virtually guaranteed rapid growth.

Differentiation may fail because of all of the following except ________.

Pacific Cycle markets a product for virtually every market segment, offers a range of quality in its product mix, and keeps costs down by ________.

Variable costs are the costs of ________.

Firms that produce differentiated products usually have difficulties managing costs.

Two firms of the same size may have significantly different operating costs because one has progressed farther down the learning curve.

It is necessary to have both financial and human capital resources to successfully pull off a firm's strategy.

If a firm's strategy can be implemented, then it must be aligned with the appropriate implementation levers.

Focused differentiation targets unique products to relatively small segments.

The Economic Logic vs Scope of Arena model identifies four generic strategic positions that result from a firm's starting strategic position. Which is not one of these four positions?

Focus positions may fail because of all of the following except ________.

As production experience is gained, incremental production costs increase at a constant rate.

Name the four positions included in Porter's concept of generic strategies.

Introducing Strategic Management

Leading Strategically Through Effective Vision and Mission

Examining the Internal Environment: Resources

Exploring the External Environment: Macro Industry and Dynamics

Crafting Business Strategy of Dynamic Contexts

Developing Corporate Strategy

Looking at International Strategies

Understanding Alliances and Cooperative Strategies

Studying Merges and Acquisitions

Organizational Structure, Systems, and Processes

Considering New Ventures and Corporate Renewal

Corporate Governance in the Twenty-First Century

Filters

Exam 5: Creating Business Strategies

According to Porter, what are the two key factors affecting the economic logic of competitive advantage?

Learning and economies of scope are both drivers of the differentiation strategic position.

When a company is acquired by another, but still operates independently, it operates as a(n) ________.

Different production technologies result in similar costs.

The levers that are necessary for implementing a firm's strategy include all but having ________.

A successful differentiation position requires that a firm satisfy all but which of the following criteria?

Mercedes Benz is the world's leading manufacturer of premium passenger cars because it has a reputation for all but which of the following?

As industries enter periods of rapid growth, early movers are virtually guaranteed rapid growth.

Differentiation may fail because of all of the following except ________.

Pacific Cycle markets a product for virtually every market segment, offers a range of quality in its product mix, and keeps costs down by ________.

Variable costs are the costs of ________.

Firms that produce differentiated products usually have difficulties managing costs.

Two firms of the same size may have significantly different operating costs because one has progressed farther down the learning curve.

It is necessary to have both financial and human capital resources to successfully pull off a firm's strategy.

If a firm's strategy can be implemented, then it must be aligned with the appropriate implementation levers.

Focused differentiation targets unique products to relatively small segments.

The Economic Logic vs Scope of Arena model identifies four generic strategic positions that result from a firm's starting strategic position. Which is not one of these four positions?

Focus positions may fail because of all of the following except ________.

As production experience is gained, incremental production costs increase at a constant rate.

Name the four positions included in Porter's concept of generic strategies.

Introducing Strategic Management

Leading Strategically Through Effective Vision and Mission

Examining the Internal Environment: Resources

Exploring the External Environment: Macro Industry and Dynamics

Crafting Business Strategy of Dynamic Contexts

Developing Corporate Strategy

Looking at International Strategies

Understanding Alliances and Cooperative Strategies

Studying Merges and Acquisitions

Organizational Structure, Systems, and Processes

Considering New Ventures and Corporate Renewal

Corporate Governance in the Twenty-First Century

Filters