Deck 3: Understanding Market Opportunities

Question 1

Rivalry is greater when there is little product differentiation.

Answer 1

True

Question 2

Entry into a market is more difficult when economies of scale and learning effects are absent.

Answer 2

False

Question 3

In the emerging economies of Asia and Latin America,the pace of economic development in recent years has led to a rapid increase in the number of consumers deemed by demographers to be middle class.

Answer 3

True

Question 4

Economic trends are independent of the other macro trends.

Question 5

Demographic changes have no effect on public finances or society's costs of health care.

Question 6

An industry's long term attractiveness can best be judged by analyzing the five major competitive forces identified by Porter.

Question 7

Studies indicate that while entry barriers may deter innovative entries into a market,they are less likely to deter me-too entries.

Question 8

Assessing market attractiveness requires that important micro trends be analyzed and not the macrotrends.

Question 9

The micro-level analyses are based on environmental conditions that affect the market or industry,respectively,as a whole,without regard to a particular company's strategy,target market,or its role in its industry.

Question 10

The greater the bargaining power of the key suppliers in an industry,the greater will be the overall attractiveness of the industry.

Question 11

The greater the competitive rivalry in an industry,the less attractive it is to current players or would-be entrants.

Question 12

Developments in telecommunications and computing have led to the rapid convergence of the telecommunication,computing,and entertainment industries.

Question 13

Entry into a market is difficult when strong product differentiation exists among current players.

Question 14

Among the most far-reaching of the six macro trend components is the economic environment.

Question 15

The increasing imbalance between the economic prospects for those living in more developed versus less developed countries is leading to increased levels of immigration.

Question 16

Changes in the earth's resources and climate do not have any effect on marketing.

Question 17

Two sociocultural trends of particular relevance today are greater interest in ethical behavior by businesses and a greater consciousness regarding fitness and nutrition.

Question 18

Rivalry among present competitors is greater if the investment intensity is low.

Question 19

Markets are comprised of sellers and industries are comprised of buyers.

Question 20

Deregulation has typically changed the structure of the affected industries as well as increased prices creating slow growth in some markets.

Question 21

Opportunities are attractive at the micro level on the industry side when it possesses something proprietary that other companies cannot easily duplicate or imitate.

Question 22

Trendz Inc. ,a global enterprise surveys the aging of the rapidly growing middle class in emerging countries,increased levels of immigration,and the decline in married households in developed countries.Which of the following components of the macro trend is being surveyed in this case?

A)Demographic
B)Economic
C)Sociocultural
D)Regulatory

Question 23

The extent to which buyers succeed in their bargaining efforts depends on switching costs that reduce the buyer's bargaining power.

Question 24

A market that's stagnant or declining at the macro level can never be an attractive one.

Question 25

All of the following fall under the category of sociocultural trends,EXCEPT:

A)the increase in the world's older population.
B)the popularity of natural foods.
C)increase in the number of fitness clubs.
D)the lowering of fat and cholesterol in packaged fooD.

Question 26

In retailing,location is a crucial success factor.

Question 27

In the context of sociocultural trends,which of the following is true?

A)The interest in ethical behavior by businesses has not changed over the years.
B)The sociocultural changes have no effect on the market.
C)The society is moving toward healthy food habits.
D)The increasing rate of immigration falls under the category of sociocultural trends.

Question 28

Among the six macroenvironmental trend components that help in assessing market attractiveness,the most important is the:

A)economic environment.
B)sociocultural environment.
C)demographic environment.
D)technological environment.

Question 29

The macro-level analyses of markets and industries mainly focus upon:

A)individuals in a market or industry.
B)environmental conditions affecting the market.
C)specific target customers and companies.
D)channels of distribution related to a company.

Question 30

A(n)_____ is defined as being comprised of individuals or organizations that are interested and willing to buy a good or service to obtain benefits that will satisfy a particular need or want and who have the resources to engage in such a transaction.

A)industry
B)firm
C)market
D)marketing channel

Question 31

Increased interest in fitness and healthy food habits is an example of a(n)_____ trend.

A)regulatory
B)economic
C)demographic
D)sociocultural

Question 32

The seven domains provide a useful and integrative lens through which to examine the fundamental health of a business and the opportunities it has chosen to pursue at any stage in its products' life cycles

Question 33

To assess opportunities,one must identify the industry's few CSFs,that generally include money.

Question 34

One way of measuring markets is in terms of the number of qualified potential customers.

Question 35

The greater the power of high-volume customers served by an industry,the more attractive will be that industry.

Question 36

The opportunity/threat matrix allows for the examination of only a small number of events.

Question 37

A(n)_____ consists of a group of firms that offer a product or class of products that are similar and are close substitutes for one another.

A)industry
B)marketing channel
C)market
D)distribution chain

Question 38

In the context of the present economic environment,which of the following is true?

A)The near-term future of the developed economies lies in the factories of exporters.
B)Economic trends work independent of the other macro trends.
C)It has the least far-reaching effect among the six macro trend components.
D)The changes in the economic environment have no effect on the market.

Question 39

The micro-level analyses of markets and industries mainly focus upon:

A)economic factors affecting the market.
B)demographic factors affecting the market.
C)sociocultural factors affecting the market.
D)individuals in a market or industry.

Question 40

The key outputs of a competent macro trend analysis for any market should include both quantitative and qualitative data.

Question 41

Which of the following statements is true in the context of the technological environment?

A)Technology has little bearing upon the operation of businesses.
B)The production of crop is not affected by technological developments.
C)Technological innovations are the result of changes in computing systems only.
D)Technology has changed how goods and services as well as ideas are exchangeD.

Question 42

In the context of rivalry among present competitors,which of the following is true?

A)Firms are mostly independent of one another.
B)Profitability increases as rivalry increases.
C)Rivalry is greater when the rate of investment intensity is low.
D)Rivalry occurs among firms producing goods that are substitutes for each other.

Question 43

Which of the following is an example of green products?

A)Diesel engines
B)Low-fat foods
C)Detergents
D)Organic fertilizers

Question 44

Global warming and increased attention to sustainability are trends in our _____ environment.

A)cultural
B)technological
C)natural
D)demographic

Question 45

Which of the following macro trend components that result in regulation or deregulation,have the most powerful impact on market attractiveness?

A)Fitness and nutrition
B)Increased immigration
C)Political and legal
D)Rising interest rates

Question 46

Which of the following factors has had the biggest impact on the way people communicate with each other?

A)Reduced costs of voice and data communication
B)Increased data storage capabilities of devices
C)Increased restrictions on the use of the Internet
D)Stagnation of technological development

Question 47

Porter's five competitive forces include all of the following EXCEPT:

A)rivalry among present competitors.
B)threat of complementary products.
C)bargaining power of buyers.
D)the bargaining power of suppliers.

Question 48

Entry of new competitors into a particular market is more difficult:

A)in the absence of strong economies of scale.
B)in the absence of learning effects.
C)if the industry has low capital requirements at the outset.
D)if strong product differentiation exists in the market.

Question 49

The rise or fall of people's incomes,fluctuations in interest rates,the changes in fiscal policy of governments that results in increased or decreased government spending are all elements that come under the category of _____ trend.

A)regulatory
B)economic
C)demographic
D)sociocultural

Question 50

In the context of regulatory environment,overregulation would result in the:

A)increase in entry of new competitors.
B)decrease of inflationary pressures.
C)increase in market attractiveness.
D)protection of inefficiencies.

Question 51

Which of the following is true of the world's natural environment?

A)The quality and quantity of groundwater is increasing.
B)There is a build-up of carbon dioxide resulting from the use of fossil fuels.
C)The rate of global warming has come down due to the increase in greenhouse gases.
D)The area of forest land has always been constant.

Question 52

Under which condition will rivalry among present competitors be greater?

A)There is a low investment intensity.
B)The industry consists of one dominant firm and other minor ones.
C)There is significant product differentiation.
D)It is easy for customers to switch between competing products.

Question 53

In the context of rivalry among firms,the similarity of passenger car tires between different producers has resulted in:

A)high switching costs.
B)establishment of a monopoly.
C)little product differentiation.
D)little need for working capital.

Question 54

Which of the following purchases is most likely to be affected by changes in interest rates?

A)Alcohol
B)Food
C)House
D)Cosmetics

Question 55

The rise of Internet retailing and Internet telephony has policy makers arguing over the degree to which these Internet activities should be subject to state and federal tax in the United States.Such a trend is related to the:

A)sociocultural environment.
B)regulatory environment.
C)transitory environment.
D)demographic environment.

Question 56

High investment intensity requires firms to:

A)operate at or near capacity.
B)decrease the rate of rivalry.
C)to increase profit margin.
D)to decrease production.

Question 57

In context of the present regulatory environment,which of the following holds true?

A)In the U.S. ,airlines,trucking,and railroads are yet to be deregulated.
B)It has no effect upon the market attractiveness.
C)Deregulation has typically changed the structure of the affected industries.
D)Overregulation encourages the entry of new competitors.

Question 58

Technological developments have a profound impact on all of the following EXCEPT:

A)distribution.
B)packaging.
C)deregulation.
D)marketing communication.

Question 59

The emergence of computers,smartphones,new lightweight materials,and genetically engineered drugs are related to the _____.

A)sociocultural environment.
B)technological environment.
C)transitory environment.
D)demographic environment.

Question 60

A reduction in the administrative and legal barriers to competition is called:

A)segmentation.
B)protectionism.
C)nationalization.
D)deregulation.

Question 61

The success of buyers in their bargaining efforts is more when:

A)the switching cost is high.
B)the threat of backward integration is absent.
C)the extent of buyer concentration is high.
D)the bargaining power of suppliers is high.

Question 62

What is the difference between a market and an industry?

Question 63

Generic category benefits:

A)are the basics that customers expect a good marketer to provide in a particular product category.
B)are the basic benefits pertaining to a particular product that are made available to lifetime consumers.
C)are visible to customers only in the growth stage of the product life cycle.
D)are benefits that accrue only from superior products in a particular product category.

Question 64

When is the bargaining power of suppliers high?

A)When the cost of switching suppliers is low
B)If prices of substitutes are low
C)If suppliers can realistically threaten forward integration
D)When the rate of investment is low

Question 65

What are critical success factors in the context of industries?

Question 66

Cite examples of how the technological,sociocultural,and demographic components of the marketing environment could affect the soft drink industry.

Question 67

Venus Inc.and Uranus Inc.deal in electronic goods.Both the companies produce portable audio cassette players.Venus Inc.introduces a new range of mp3 players which lead to the decrease in sales of the line of audio cassette players of both the companies.Which of Porter's competitive forces is in effect in this case?

A)Threat of new entrants
B)Threat of substitute products
C)Bargaining power of supplier
D)Lack of rivalry

Question 68

What are the ways in which a company can act ethically with regard to macro environmental trends?

Question 69

In context of the seven domains related to the pursuit of attractive opportunities,which of the following holds true?

A)The seven domains are additive and scoring well in each domain guarantees success.
B)A brilliant management can turn a business known for bad economics into a success with little effort.
C)When a company chooses unattractive opportunities to pursue,it will face tough sledding.
D)It is not important for opportunities to match up to a company's expectation.

Question 70

Opportunities are attractive at the micro level on the market side when:

A)scope for growth of the target segment is limited.
B)the offering provides the existing customer benefits.
C)the customer need is clearly established.
D)the bargaining power of suppliers is high.

Question 71

List two major trends related to the present world population.

Question 72

State the five competitive forces postulated by Porter that collectively determine an industry's long-term attractiveness.Is wireless phone service offered by a company a new entrant or substitute threat to wired phone service provided by the same company?

Question 73

_____ is the critical success factor in the retailing business.

A)Customer care
B)Location
C)Management
D)Technology

Question 74

Discuss the implications of a major sociocultural trend of particular relevance in the present times.

Question 75

Opportunities are attractive at the micro level on the industry side when:

A)the company employs organizational processes that have been successfully used by others.
B)the company possesses something proprietary that other companies cannot easily duplicate.
C)the scope for growth of the target segment is limited.
D)the products provide the existing customer benefits in the market.

Question 76

List the instances in which bargaining power of suppliers increases.

Question 77

Which of the following is most likely the critical success factor around which Apple has made a success out of its iPhone offering in the smartphone industry?

A)Technology
B)Customer service
C)Location
D)Pricing

Question 78

Give examples of important macro trends that a real estate investor,a high tech entrepreneur,and food company are most likely to consider.

Question 79

The cost of switching suppliers is high if:

A)bargaining power of suppliers increases.
B)bargaining power of suppliers decreases.
C)it leads to more deregulation.
D)it leads to less deregulation.

Question 80

Create an opportunity/threat matrix for a pharmaceutical firm.