Question 1

Which one of the following is not a risk associated with the cost leadership strategy?

Accepted Answer

A) Customer perceptions of the value of the product 
B) Efficient processes becoming obsolete 
C) Ignorance of the competitive levels of differentiation 
D) Imitation by competitors

Question 2

Which one of the following is not a business-level strategy?

Accepted Answer

A) Diversification 
B) Focus 
C) Differentiation 
D) Cost leadership

Question 3

A focus strategy seeks to exploit core competencies:

Accepted Answer

A) by serving the needs of a certain industry segment 
B) on an industry-wide basis 
C) by servicing several professions 
D) by servicing one particular corporation within a given industry

Question 4

The probability of successful competition increases when a firm carefully integrates internet technology with its strategy, rather than using internet technology on a 'stand-alone basis'.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following questions is not a customer consideration when a firm is selecting a business-level strategy?

Accepted Answer

A) How can customer needs be satisfied? 
B) Who will be served? 
C) What needs do target customers have? 
D) When do customers make purchases or switch suppliers?

Question 6

A cost leadership strategy can be summarised as:

Accepted Answer

A) providing products with features acceptable to customers at the lowest competitive price 
B) offering products with very inexpensive features so that the price of the product is very low 
C) providing unique products so that customers are willing to pay a premium 
D) focusing on a few unique features for which customers are willing to pay a premium

Question 7

The differentiation strategy can be effective in controlling the power of rivalry in an industry because:

Accepted Answer

A) customers will seek out the lowest-cost product 
B) customers have no loyalty 
C) customers are loyal to brands that satisfy their differentiated needs 
D) the differentiation strategy benefits from rivalry

Question 8

Compared to firms implementing an integrated cost leadership/differentiation strategy, a company that successfully uses one dominant business-level strategy should be in a better position to learn new skills and technologies more quickly and to effectively leverage its core competencies while competing against its rivals.

Accepted Answer

A) True 
 B)False

Question 9

The affiliation dimension of relationships with customers is concerned with developing relationships with third-party affiliates who can best serve customers.

Accepted Answer

A) True 
 B)False

Question 10

The risks of a cost leadership strategy include:

Accepted Answer

A) becoming 'stuck in the middle' 
B) not increasing the value of a good or service in the face of successful imitations 
C) the ability of competing firms to provide similar features in a product 
D) customers deciding the product is not worth what the firm must charge for it

Question 11

The risks of a focus strategy include:

Accepted Answer

A) a competitor's ability to use its core competencies to 'out-focus' the focuser by serving a more narrowly defined segment 
B) a competitor's ability to use its core competencies to 'out-focus' the focuser by serving a more broadly defined segment 
C) decisions by industry-wide competitors to use their resources to serve a wider range of customers' specialised needs than the focuser has been serving 
D) decisions by focused competitors to use their resources to serve a wider range of customers' needs

Question 12

The five business-level strategies can be defined along the dimensions of:

Accepted Answer

A) competitive positioning and competitive advantage 
B) competitive scope and competitive landscape 
C) competitive landscape and competitive positioning 
D) competitive advantage and competitive scope

Question 13

Research suggests that having a competitive advantage in terms of logistics creates more value when using the cost leadership strategy than when using the differentiation strategy.

Accepted Answer

A) True 
 B)False

Question 14

A firm is 'stuck in the middle' when its industry is in the middle of a rapid technological change.

Accepted Answer

A) True 
 B)False

Question 15

Describe the risks of a differentiation strategy.

Accepted Answer

The answer of Describe the risks of a differentiation strategy....

Question 16

A cost leadership strategy provides goods or services with features that are:

Accepted Answer

A) unique to the customer 
B) not valued by the customer 
C) acceptable to customers 
D) able to meet unique needs of the customer

Exam 4: Business-Level Strategy

Which one of the following is not a risk associated with the cost leadership strategy?

Which one of the following is not a business-level strategy?

A focus strategy seeks to exploit core competencies:

The probability of successful competition increases when a firm carefully integrates internet technology with its strategy, rather than using internet technology on a 'stand-alone basis'.

Which of the following questions is not a customer consideration when a firm is selecting a business-level strategy?

A cost leadership strategy can be summarised as:

The differentiation strategy can be effective in controlling the power of rivalry in an industry because:

The affiliation dimension of relationships with customers is concerned with developing relationships with third-party affiliates who can best serve customers.

The risks of a cost leadership strategy include:

The risks of a focus strategy include:

The five business-level strategies can be defined along the dimensions of:

Research suggests that having a competitive advantage in terms of logistics creates more value when using the cost leadership strategy than when using the differentiation strategy.

A firm is 'stuck in the middle' when its industry is in the middle of a rapid technological change.

Describe the risks of a differentiation strategy.

A cost leadership strategy provides goods or services with features that are: