Question 1

First mover advantages refers to the benefits a firm may achieve by entering a new market or developing a new product or service prior to rival firms.

Accepted Answer

A) True 
 B)False  True

Question 2

All of the following are important factors in the Balanced Scorecard except

Accepted Answer

A)  customer service.
B)  business ethics.
C)  employee morale.
D)  product quality.
E)  stockholder equity. E

Question 3

A chief executive officer is located in the divisional level of a large firm.

Accepted Answer

A) True 
 B)False  False

Question 4

Under which condition would a cost leadership strategy be especially effective?

Accepted Answer

A)  When few rival firms are following a similar approach.
B)  When the products of rival sellers are essentially identical and supplies are readily available from any of several eager sellers.
C)  When there are many ways to differentiate the product or service and many buyers perceive these differences as having value.
D)  When buyer needs and uses are diverse.
E)  When technological change is fast paced and competition revolves around rapidly evolving product features.

Question 5

Innovative strategy requires investing a small amount of capital in R&D and changing the company culture to one that supports creativity and talent.

Accepted Answer

A) True 
 B)False

Question 6

Adding new,unrelated products or services is called

Accepted Answer

A)  related diversification.
B)  conglomerate diversification.
C)  forward integration.
D)  unrelated diversification.
E)  backward integration.

Question 7

What are the characteristics of a firm that is successfully pursuing a cost leadership strategy?

Accepted Answer

The answer of What are the characteristics of a firm...

Question 8

When the correlation between dollar sales and dollar marketing expenditures has historically been low,market penetration is an appropriate strategy.

Accepted Answer

A) True 
 B)False

Question 9

What term refers to selling a division of an organization?

Accepted Answer

A)  Divestiture
B)  Joint venture
C)  Liquidation
D)  Horizontal integration
E)  Concentric diversification

Question 10

Product development is a strategy that seeks increased sales by improving or modifying present products or services.

Accepted Answer

A) True 
 B)False

Question 11

Which strategy generally entails large research and development expenditures?

Accepted Answer

A)  Retrenchment
B)  Divestiture
C)  Product development
D)  Forward integration
E)  Market penetration

Question 12

Innovation implies

Accepted Answer

A)  the recycling of unused product
B)  the modification of an existing product
C)  the duplication of a popular product
D)  the creation of a completely new product
E)  All of the above

Question 13

A leveraged buyout occurs when a firm's management and other private investors use borrowed funds to buy out the firm's shareholders.

Accepted Answer

A) True 
 B)False

Question 14

An acquisition occurs when a large organization purchases a smaller one or vice versa.

Accepted Answer

A) True 
 B)False

Question 15

Product development is an appropriate strategy when an organization has successful products that are in the maturity stage of their life cycle.

Accepted Answer

A) True 
 B)False

Question 16

Al Faisaliah Hotel would be a good example of a firm seeking the best- value focus strategy.

Accepted Answer

A) True 
 B)False

Question 17

According to Porter,strategies allow organizations to gain competitive advantage from three different bases: cost leadership,differentiation and integration.

Accepted Answer

A) True 
 B)False

Question 18

What principle is based on the belief that the true measure of a really good strategist is the ability to solve problems?

Accepted Answer

A)  Managing by subjectives
B)  Managing by hope
C)  Managing by extrapolation
D)  Managing by objectives
E)  Managing by crisis

Question 19

In which situation would horizontal integration be an especially effective strategy?

Accepted Answer

A)  When decreased economies of scale provide major competitive advantages.
B)  When an organization can gain monopolistic characteristics in a particular area or region without being challenged by the federal government for "tending substantially" to reduce competition.
C)  When an organization competes in a slowing industry.
D)  When an organization has neither the capital nor human talent needed to successfully manage an expanded organization.
E)  When competitors are succeeding due to managerial expertise or having particular resources an organization possesses.

Question 20

A differentiation strategy can be especially attractive when the industry has many different niches and segments,thereby allowing a focuser to pick a competitively attractive niche suited to its own resources.

Accepted Answer

A) True 
 B)False

Exam 6: Strategies in Action

First mover advantages refers to the benefits a firm may achieve by entering a new market or developing a new product or service prior to rival firms.

All of the following are important factors in the Balanced Scorecard except

A chief executive officer is located in the divisional level of a large firm.

Under which condition would a cost leadership strategy be especially effective?

Innovative strategy requires investing a small amount of capital in R&D and changing the company culture to one that supports creativity and talent.

Adding new,unrelated products or services is called

What are the characteristics of a firm that is successfully pursuing a cost leadership strategy?

When the correlation between dollar sales and dollar marketing expenditures has historically been low,market penetration is an appropriate strategy.

What term refers to selling a division of an organization?

Product development is a strategy that seeks increased sales by improving or modifying present products or services.

Which strategy generally entails large research and development expenditures?

Innovation implies

A leveraged buyout occurs when a firm's management and other private investors use borrowed funds to buy out the firm's shareholders.

An acquisition occurs when a large organization purchases a smaller one or vice versa.

Product development is an appropriate strategy when an organization has successful products that are in the maturity stage of their life cycle.

Al Faisaliah Hotel would be a good example of a firm seeking the best- value focus strategy.

According to Porter,strategies allow organizations to gain competitive advantage from three different bases: cost leadership,differentiation and integration.

What principle is based on the belief that the true measure of a really good strategist is the ability to solve problems?

In which situation would horizontal integration be an especially effective strategy?

A differentiation strategy can be especially attractive when the industry has many different niches and segments,thereby allowing a focuser to pick a competitively attractive niche suited to its own resources.