Question 1

A(n) _____ means that a firm is competing based on uniqueness rather than price and is seeking to attract a broad market.

Accepted Answer

A) focused cost leadership strategy 
B) cost leadership strategy 
C) pull strategy 
D) adaptive strategy 
E) differentiation strategy 
A) focused cost leadership strategy 
B) cost leadership strategy 
C) pull strategy 
D) adaptive strategy 
E) differentiation strategy

Question 2

A health drink company is known for launching drinks with flavors which are different from what are offered in the market.It regularly indulges in experimentation to come up with new and exotic flavored drinks.It also charges higher than what other health drink companies charge.Which of the following statements would hold true for this company?

Accepted Answer

A) It offers generic and standardized products. 
B) It does not invest in the field of market research. 
C) It spends little on research and development. 
D) It invests heavily in advertising and brand building. 
E) It competes with its rivals on the basis of price. 
A) It offers generic and standardized products. 
B) It does not invest in the field of market research. 
C) It spends little on research and development. 
D) It invests heavily in advertising and brand building. 
E) It competes with its rivals on the basis of price.

Question 3

A company introduces a new helmet for bikers.The company prices the helmets much lower than others offered in the market.This enables the company to attract a lot of customers.This is an example of a(n) _____ strategy.

Accepted Answer

A) focused differentiation 
B) pull 
C) cost leadership 
D) adaptive 
E) differentiation 
A) focused differentiation 
B) pull 
C) cost leadership 
D) adaptive 
E) differentiation

Question 4

A national grocery chain sets up a store in a small town.It sources most of its produce from the local farmers.Since it sources the produce in bulk, it demands discounts from the suppliers.The store passes some of these savings to the customers in the form of low prices for the products.The price is lower than what is offered by the local grocery stores.The large quantities of products sold compensates for the lower price.This is an example of:

Accepted Answer

A) economies of distribution. 
B) economies of cost. 
C) economies of demand. 
D) economies of supply. 
E) economies of scale. 
A) economies of distribution. 
B) economies of cost. 
C) economies of demand. 
D) economies of supply. 
E) economies of scale.

Question 5

What is a best-cost strategy? Why is it difficult to execute?

Accepted Answer

Firms that charge relatively low prices

Question 6

Customers, in many cases, may simply prefer a cheaper alternative to a unique product sold at a premium price.

Accepted Answer

A) True 
 B)False

Question 7

Focusing on generic strategies allows executives to concentrate on the core elements of firms' business-level strategies.

Accepted Answer

A) True 
 B)False

Question 8

A health drink company is known for launching drinks with flavors which are different from what are offered in the market.It regularly indulges in experimentation to come up with new and exotically flavored drinks.It also charges higher than the other health drink companies.What disadvantage would the company face because of the strategy it follows?

Accepted Answer

A) The firm needs to attract huge numbers of customers in order to have a good overall level of profit. 
B) Differentiation lacks an ability to obtain premium prices from customers. 
C) A differentiation strategy allows the entrance of new companies in the market. 
D) A differentiation strategy lacks the capacity to generate buyer loyalty. 
E) Competitors may be able to imitate the features well enough that they are no longer unique. 
A) The firm needs to attract huge numbers of customers in order to have a good overall level of profit. 
B) Differentiation lacks an ability to obtain premium prices from customers. 
C) A differentiation strategy allows the entrance of new companies in the market. 
D) A differentiation strategy lacks the capacity to generate buyer loyalty. 
E) Competitors may be able to imitate the features well enough that they are no longer unique.

Question 9

A(n) _____ strategy requires competing based on price to target a narrow market.

Accepted Answer

A) focused cost leadership 
B) pull leadership 
C) focused differentiation 
D) adaptive 
E) differentiation 
A) focused cost leadership 
B) pull leadership 
C) focused differentiation 
D) adaptive 
E) differentiation

Question 10

Which of the following is an advantage of a company following a focused strategy?

Accepted Answer

A) Companies following the focused differentiation strategy can charge very high prices. 
B) Damaging attacks never comes from larger firms 
C) The companies are protected from the damaging attacks of smaller firms that adopt an even narrower focus. 
D) Companies following the focused differentiation strategy never have their growth stymied irrespective of the fact that they serve a niche market. 
E) The niche that is an area of operation of one company cannot be made to disappear or be taken over by larger competitors. 
A) Companies following the focused differentiation strategy can charge very high prices. 
B) Damaging attacks never comes from larger firms 
C) The companies are protected from the damaging attacks of smaller firms that adopt an even narrower focus. 
D) Companies following the focused differentiation strategy never have their growth stymied irrespective of the fact that they serve a niche market. 
E) The niche that is an area of operation of one company cannot be made to disappear or be taken over by larger competitors.

Question 11

Which of the following is a disadvantage of cost leadership?

Accepted Answer

A) The presence of a cost leader in an industry tends to discourage new firms from entering the business. 
B) Low prices for goods and services always lead to low customer base. 
C) Downplaying research and development can slow cost leaders' ability to respond to changes once they are detected. 
D) Cost leadership strategy makes companies vulnerable to price competition from rivals. 
E) Cost leadership strategy breaks down barriers to entry that protect the firm from new competition. 
A) The presence of a cost leader in an industry tends to discourage new firms from entering the business. 
B) Low prices for goods and services always lead to low customer base. 
C) Downplaying research and development can slow cost leaders' ability to respond to changes once they are detected. 
D) Cost leadership strategy makes companies vulnerable to price competition from rivals. 
E) Cost leadership strategy breaks down barriers to entry that protect the firm from new competition.

Question 12

What are the advantages of a cost leadership strategy?

Accepted Answer

Each of the generic strategies offers ad

Question 13

What are the disadvantages of a focused differentiation strategy?

Accepted Answer

In terms of disadvantages, the limited d

Question 14

A sneaker manufacturing company targets teenagers.It sells the sneakers to these teenagers at a price which is lower than what is offered in the market.The fact that it offers low sneakers to teenagers is an example of a(n):

Accepted Answer

A) focused cost leadership strategy. 
B) pull strategy. 
C) focused differentiation strategy. 
D) adaptive strategy. 
E) differentiation strategy. 
A) focused cost leadership strategy. 
B) pull strategy. 
C) focused differentiation strategy. 
D) adaptive strategy. 
E) differentiation strategy.

Question 15

The best cost strategy is difficult to execute in part because creating unique features and communicating them generally raises a firm's costs of doing business.

Accepted Answer

A) True 
 B)False

Question 16

The big risk when using a differentiation strategy is that customers will not be willing to pay extra to obtain the unique features that a firm is trying to build its strategy.

Accepted Answer

A) True 
 B)False

Question 17

Healthie is a health drink company that is known for launching drinks with flavors which are different from what are offered in the market.It regularly indulges in experimentation to come up with new and exotically flavored drinks.It also charges higher than the other health drink companies.Another company offers the same drinks a lower price.Customers who were once loyal to Healthie immediately switch over to the new company which is charging a lower price for the same drinks.This is an example of _____.

Accepted Answer

A) price sensitivity 
B) affective conflict 
C) party selling 
D) palming off 
E) all-you-can-afford budgeting 
A) price sensitivity 
B) affective conflict 
C) party selling 
D) palming off 
E) all-you-can-afford budgeting

Question 18

Car manufacturers such as Lamborghini and Ferrari compete in the small super car category.These cars offer more than just transportation.They are known for their styling and state of art technology.This is an example of a(n):

Accepted Answer

A) adaptive strategy. 
B) pull strategy. 
C) focused cost leadership strategy. 
D) cost leadership strategy. 
E) focused differentiation strategy. 
A) adaptive strategy. 
B) pull strategy. 
C) focused cost leadership strategy. 
D) cost leadership strategy. 
E) focused differentiation strategy.

Question 19

A bike manufacturing company targets college going kids.The price of the bikes offered by this company is lower than what the other companies offer in the market.The fact that it offers low priced bikes to college going kids is an example of a(n):

Accepted Answer

A) adaptive strategy. 
B) differentiation strategy. 
C) focused cost leadership strategy. 
D) pull strategy. 
E) focused differentiation strategy. 
A) adaptive strategy. 
B) differentiation strategy. 
C) focused cost leadership strategy. 
D) pull strategy. 
E) focused differentiation strategy.

Question 20

A health drink company is known for launching drinks with flavors which are different from what are offered in the market.It regularly indulges in experimentation to come up with new and exotic flavored drinks.It also charges higher than what other health drink companies charge.What advantage would the company enjoy because of the strategy it follows?

Accepted Answer

A) It can depend on its ability to reduce the price to drive competition out of the market. 
B) Customers always prefer a product with features rather than a cheaper alternative. 
C) It has an ability to obtain premium prices from customers. 
D) It does not need to spend significant funds on advertising. 
E) Customers are always eager to pay extra to obtain the unique features that a firm is trying to build its strategy around. 
A) It can depend on its ability to reduce the price to drive competition out of the market. 
B) Customers always prefer a product with features rather than a cheaper alternative. 
C) It has an ability to obtain premium prices from customers. 
D) It does not need to spend significant funds on advertising. 
E) Customers are always eager to pay extra to obtain the unique features that a firm is trying to build its strategy around.

A(n) _____ means that a firm is competing based on uniqueness rather than price and is seeking to attract a broad market.

A company introduces a new helmet for bikers.The company prices the helmets much lower than others offered in the market.This enables the company to attract a lot of customers.This is an example of a(n) _____ strategy.

What is a best-cost strategy? Why is it difficult to execute?

Customers, in many cases, may simply prefer a cheaper alternative to a unique product sold at a premium price.

Focusing on generic strategies allows executives to concentrate on the core elements of firms' business-level strategies.

A(n) _____ strategy requires competing based on price to target a narrow market.

Which of the following is an advantage of a company following a focused strategy?

Which of the following is a disadvantage of cost leadership?

What are the advantages of a cost leadership strategy?

What are the disadvantages of a focused differentiation strategy?

A sneaker manufacturing company targets teenagers.It sells the sneakers to these teenagers at a price which is lower than what is offered in the market.The fact that it offers low sneakers to teenagers is an example of a(n):

The best cost strategy is difficult to execute in part because creating unique features and communicating them generally raises a firm's costs of doing business.

The big risk when using a differentiation strategy is that customers will not be willing to pay extra to obtain the unique features that a firm is trying to build its strategy.

Car manufacturers such as Lamborghini and Ferrari compete in the small super car category.These cars offer more than just transportation.They are known for their styling and state of art technology.This is an example of a(n):

A bike manufacturing company targets college going kids.The price of the bikes offered by this company is lower than what the other companies offer in the market.The fact that it offers low priced bikes to college going kids is an example of a(n):

Mastering Strategy: Art and Science

Leading Strategically

Evaluating the External Environment

Managing Company Resources

Supporting the Business-Level Strategy: Competitive and Cooperative Moves

Competing in International Markets

Selecting Corporate-Level Strategies

Executing Strategy Through Organizational Design

Leading an Ethical Organization: Corporate Governance, Corporate Ethics, and Social Responsibility

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Exam 5: Selecting Business-Level Strategies

A(n) _____ means that a firm is competing based on uniqueness rather than price and is seeking to attract a broad market.

A company introduces a new helmet for bikers.The company prices the helmets much lower than others offered in the market.This enables the company to attract a lot of customers.This is an example of a(n) _____ strategy.

What is a best-cost strategy? Why is it difficult to execute?

Customers, in many cases, may simply prefer a cheaper alternative to a unique product sold at a premium price.

Focusing on generic strategies allows executives to concentrate on the core elements of firms' business-level strategies.

A(n) _____ strategy requires competing based on price to target a narrow market.

Which of the following is an advantage of a company following a focused strategy?

Which of the following is a disadvantage of cost leadership?

What are the advantages of a cost leadership strategy?

What are the disadvantages of a focused differentiation strategy?

A sneaker manufacturing company targets teenagers.It sells the sneakers to these teenagers at a price which is lower than what is offered in the market.The fact that it offers low sneakers to teenagers is an example of a(n):

The best cost strategy is difficult to execute in part because creating unique features and communicating them generally raises a firm's costs of doing business.

The big risk when using a differentiation strategy is that customers will not be willing to pay extra to obtain the unique features that a firm is trying to build its strategy.

Car manufacturers such as Lamborghini and Ferrari compete in the small super car category.These cars offer more than just transportation.They are known for their styling and state of art technology.This is an example of a(n):

A bike manufacturing company targets college going kids.The price of the bikes offered by this company is lower than what the other companies offer in the market.The fact that it offers low priced bikes to college going kids is an example of a(n):

Mastering Strategy: Art and Science

Leading Strategically

Evaluating the External Environment

Managing Company Resources

Supporting the Business-Level Strategy: Competitive and Cooperative Moves

Competing in International Markets

Selecting Corporate-Level Strategies

Executing Strategy Through Organizational Design

Leading an Ethical Organization: Corporate Governance, Corporate Ethics, and Social Responsibility

Filters