Exam 8: Managing Global Competitive Dynamics

The three drivers of counterattacks do not include: a. Awareness. b. Motivation. c. Capability. d. B and C above. e. Vengeance.

Thrust makes use of military theory that the attacker needs to have at least a three-to-one advantage to overcome a well-defended position through a conventional frontal assault.

Bargaining can take place through signals and actions.

Barriers for entrants with similar products and with substitute products are involved in the other two of the five forces.

In some of the discussions of strategy. It was suggested that a firm might attempt to mislead a rival as to the firm's true objective - i.e. feint. Is that unethical? Explain.

Which of the following aspects of U.S. competition/antitrust policy has been opposed by the EU? a. Collusive price setting. b. Predatory pricing. c. Extraterritoriality. d. Court decisions. e. Changes in policy.

Can national policies that seek to promote the well being of its citizens by its attempts to maintain competition actually have the opposite effect? Why or why not?

Firm A may be more successful in imitating Firm B if Firm B: a. Is competitively aggressive. b. Carries out complex actions. c. Uses difficult to execute maneuvers. d. All of the above. e. None of the above.

In developing a strategy regarding competition or cooperation, it would be useful to not: a. Understand the nature of your industry. b. Strengthen capabilities that more effectively compete and/or cooperate. c. Understand the rules of the game governing competition. d. "Look ahead, reason back e. All of the above.

Under antitrust law a company can be in trouble for setting prices too high but not for setting them too low.

Dumping involves selling something below cost. Using what you have learned in accounting or economics or perhaps by talking to someone familiar with these courses) point out why it might sometimes be difficult to prove that a firm is selling below cost.

"The extent to which a given competitor possesses strategic endowment comparable, in terms of both type and amount, to those of the focal firm" refers to similarity of: a. Strategy. b. Resources. c. Markets. d. Industry. e. Economic environment.

Collusion survives because it does not have an incentive problem as is illustrated by the prisoner's dilemma.

Industry-based considerations regarding strategy: a. Focus on the nature of collusion. b. Deal with the relationship between industry structures and firms' propensity to collude. c. Deal with the relationship between industry structures and firms' propensity to collude to competing. d. All of the above. e. None of the above.

Multimarket competition destroys mutual forbearance.

The capability to attack in multiple markets throws the firm off balance leaving it vulnerable to rivals and thus reducing value.

Which of the following would not be considered an initial set of actions to gain competitive advantage: a. Price cuts. b. Advertising campaigns. c. Market entries. d. Counterattacks. e. New product introductions.

The text points out that modern ideas of strategy, pioneered by Michael Porter, have turned IO economics "on its head." While IO economics attempts to prevent any firm from gaining sustained competitive advantage, the very purpose of strategy is to gain a sustainable advantage. Is that good or bad?

If the attacked market is of marginal value, managers may decide not to counterattack.

Industry-based considerations are fundamentally concerned with the very first of the Porter five forces, interfirm rivalry.