Question 1

In common with the Porter five forces framework, the Schumpeterian approach views competitive behavior as the outcome of industry structure.

Accepted Answer

A) True 
 B)False

Question 2

Game theory seeks to predict the outcome of competitive situations by modeling the interactive decisions by firms,

Accepted Answer

A) True 
 B)False

Question 3

Deterrence is a competitive action that is more attractive to firms that compete in multiple markets than in a single market because the resulting reputation can be transferred from one market to another.

Accepted Answer

A) True 
 B)False

Question 4

The relationship between competition and cooperation can be described as follows:

Accepted Answer

A) Industries either compete or cooperate; if they cooperate, they are likely to be in breach of competition law 
B) Cooperation and competition may exist in an industry, but not at the same time 
C) Both can co-exist simultaneously 
D) Both can co-exist at the same time, but not in the same industry segment or strategic group

Question 5

Joseph Schumpeter perceived competition among companies as:

Accepted Answer

A) Corresponding closely to economists' model of perfect competition where profits are competed away 
B) A process of oligopolistic rivalry 
C) A process of creative destruction 
D) A process of punctuated equilibrium in which periods of stability were interspersed by bouts of intense competition

Question 6

Video game consoles and video games are complementary products: the availability of one increases the value of the other.In the past the suppliers of consoles were able to appropriate most of the profits generated by video game systems because:

Accepted Answer

A) Video game consoles cost more to develop than video games 
B) The consoles were more powerful determinant of the consumer experience than the games 
C) The console suppliers controlled technology and distribution giving them more bargaining power than the suppliers of video games 
D) The console makers-Nintendo, Sony and Microsoft-were bigger companies than the suppliers of video games.

Question 7

Where different firms supply different products that link together to form a system, power typically resides with the form that supplies the platform-the interface between the different component products.

Accepted Answer

A) True 
 B)False

Question 8

Deterrence is effective when it imposes costs upon other players, but s costless for the initiating firm.

Accepted Answer

A) True 
 B)False

Question 9

The aim of competitive intelligence is to predict competitor behavior on the basis of verifiable facts.Attempts to "get inside the heads of your rivals" are inherently unreliable and should be avoided.

Accepted Answer

A) True 
 B)False

Question 10

If administering deterrence is costly or unpleasant for the threatening party, then:

Accepted Answer

A) It may lack credibility 
B) It will always lack effectiveness 
C) It will need to be supported by appropriate signaling 
D) It reinforces the power of the threatening party

Exam 4: Further Topics in Industry and Competitive Analysis

In common with the Porter five forces framework, the Schumpeterian approach views competitive behavior as the outcome of industry structure.

Game theory seeks to predict the outcome of competitive situations by modeling the interactive decisions by firms,

Deterrence is a competitive action that is more attractive to firms that compete in multiple markets than in a single market because the resulting reputation can be transferred from one market to another.

The relationship between competition and cooperation can be described as follows:

Joseph Schumpeter perceived competition among companies as:

Video game consoles and video games are complementary products: the availability of one increases the value of the other.In the past the suppliers of consoles were able to appropriate most of the profits generated by video game systems because:

Where different firms supply different products that link together to form a system, power typically resides with the form that supplies the platform-the interface between the different component products.

Deterrence is effective when it imposes costs upon other players, but s costless for the initiating firm.

The aim of competitive intelligence is to predict competitor behavior on the basis of verifiable facts.Attempts to "get inside the heads of your rivals" are inherently unreliable and should be avoided.

If administering deterrence is costly or unpleasant for the threatening party, then: