Question 1

Some possibilities for new startup ideas based on knowledge gleaned from a present or recent job are modifying an existing product, improving a service, or duplicating a business concept in a different location.

Accepted Answer

A) True 
 B)False

Question 2

In analyzing the industry environment of the particular field into which Charles was about to enter in business, he found that there existed a fierce rivalry between the competitors that were currently in the business. This would offset the desirability of entering the industry in which of the following ways?

Accepted Answer

A)  negatively 
B)  positively 
C)  no effect 
D)  cannot be determined

Question 3

Small firms are pursuing a focus strategy if they adapt their efforts to concentrating on a specific niche within the market.

Accepted Answer

A) True 
 B)False

Question 4

Substitute products

Accepted Answer

A)  reduce the attractiveness and profitability of an industry 
B)  represent those items manufactured by direct rivals within an industry. 
C)  are usually cheaper than the products they can replace. 
D)  are always a serious threat to rivals in an industry.

Question 5

Market segmentation and niche marketing are similar in that they both utilize a top-down approach that breaks the market into smaller, more manageable sub-markets.

Accepted Answer

A) True 
 B)False

Question 6

The two broad strategies for building a competitive advantage are the _____ strategies.

Accepted Answer

A)  cost-based and differentiation-based 
B)  price-advantage and cost-advantage 
C)  marketing-advantage and price-advantage 
D)  focus-advantage and marketing-advantage

Question 7

Which of the following is one of the factors that determines the nature and degree of competition in an industry, as identified by Michael Porter in his book Competitive Advantage?

Accepted Answer

A)  The interest of small businesses 
B)  Bargaining power of competitors 
C)  Threat of substitute products or services 
D)  The macroeconomy

Question 8

The industry environment can best be defined as the combined forces that directly impact a given firms and its competitors.

Accepted Answer

A) True 
 B)False

Question 9

Serendipity is the faculty for making desirable discoveries by accident.

Accepted Answer

A) True 
 B)False

Question 10

Generally speaking, a strategy is

Accepted Answer

A)  an action plan that guides resource investments. 
B)  a formal statement of what the firm intends to do. 
C)  an expanded description of the firm's mission statement. 
D)  most effective when it is designed to reflect the tactics that are common within an industry.

Question 11

A SWOT analysis encompasses both the inside-out and outside-in approaches in determining an overview of a venture's strategic situation.

Accepted Answer

A) True 
 B)False

Question 12

Following a cost-based strategy can give a small firm a competitive advantage.

Accepted Answer

A) True 
 B)False

Question 13

The general environment profiles a number of important trends, among which are economic trends including the rate of inflation, interest rates and even currency exchange rates, all of which promote or discourage business growth.

Accepted Answer

A) True 
 B)False

Question 14

All of the following are specified by Michael Porter as factors that determine the nature and degree of competition in an industry except

Accepted Answer

A)  threat of new competitors. 
B)  rivalry among existing competitors. 
C)  industry cost/price structure. 
D)  bargaining power of buyers and/or suppliers.

Question 15

An example of a Type B startup idea is

Accepted Answer

A)  a new microsponge technology allowing oils to be contained inside billions of microscopic sponges. 
B)  a baby stroller that pushes more easily and is more difficult to overturn than previous designs. 
C)  opening a new hamburger stand on the corner with no unique product differentiation. 
D)  a new mail-order business selling a foreign-produced item never sold domestically before.

Question 16

A(n) _____ exists when multiple resources are integrated and then deployed to the firm's advantage.

Accepted Answer

A)  networked resource 
B)  common intangible 
C)  capability 
D)  industry edge

Question 17

Marketplace Farms is a regional cooperative of apple and orange growers. In order to compete against larger regional growers, Marketplace Farms relies on low-cost migrant workers instead of machines and inexpensive packaging processes. (That is, it uses individual hand-packaging instead of assembly lines.) Marketplace Farms is relying on a

Accepted Answer

A)  price-based strategy. 
B)  marketing-based strategy. 
C)  efficiency-based strategy. 
D)  cost-based strategy.

Question 18

Focus strategies can be implemented in any of the following ways except

Accepted Answer

A)  emphasizing a single product or service 
B)  limiting the market to a single geographic area 
C)  restricting focus to a single subset of customers 
D)  ensuring that the venture is the lowest-cost provider in the market

Question 19

Resources are best described as

Accepted Answer

A)  those basic inputs that a firm uses to conduct its business. 
B)  only those features that are visible and easy to quantify. 
C)  the firm's lending capacity. 
D)  capabilities that can be exploited.

Question 20

An increase in the bargaining power of suppliers

Accepted Answer

A)  increases both the attractiveness and the profitability of the target market. 
B)  decreases both the attractiveness and the profitability of the target market. 
C)  decreases the attractiveness and increases the profitability of the target market. 
D)  increases the attractiveness and decreases the profitability of the target market.

Exam 3: Getting Started

Some possibilities for new startup ideas based on knowledge gleaned from a present or recent job are modifying an existing product, improving a service, or duplicating a business concept in a different location.

Small firms are pursuing a focus strategy if they adapt their efforts to concentrating on a specific niche within the market.

Substitute products

Market segmentation and niche marketing are similar in that they both utilize a top-down approach that breaks the market into smaller, more manageable sub-markets.

The two broad strategies for building a competitive advantage are the _____ strategies.

Which of the following is one of the factors that determines the nature and degree of competition in an industry, as identified by Michael Porter in his book Competitive Advantage?

The industry environment can best be defined as the combined forces that directly impact a given firms and its competitors.

Serendipity is the faculty for making desirable discoveries by accident.

Generally speaking, a strategy is

A SWOT analysis encompasses both the inside-out and outside-in approaches in determining an overview of a venture's strategic situation.

Following a cost-based strategy can give a small firm a competitive advantage.

The general environment profiles a number of important trends, among which are economic trends including the rate of inflation, interest rates and even currency exchange rates, all of which promote or discourage business growth.

All of the following are specified by Michael Porter as factors that determine the nature and degree of competition in an industry except

An example of a Type B startup idea is

A(n) _____ exists when multiple resources are integrated and then deployed to the firm's advantage.

Focus strategies can be implemented in any of the following ways except

Resources are best described as

An increase in the bargaining power of suppliers