Question 1

To create a successful business model,managers must choose a set of business-level strategies that

Accepted Answer

A)   allow the company to better compete with rivals within an industry.
B)   help them decide what businesses to enter and exit.
C)   help build an organizational structure that contains multiple businesses.
D)   work together to give a company a competitive advantage over its rivals.
E)   help it to diversify to better leverage distinctive competencies. D

Question 2

A market segment consists of a group of

Accepted Answer

A)   similar products.
B)   customers who have similar needs.
C)   companies who produce similar products.
D)   diverse products produced by one manufacturer.
E)   customers who have diverse needs. B

Question 3

Jordan's ice cream stand offers different combinations of premium flavors,cones,and toppings to create hundreds of extravagant,customized products.Which generic strategy is Jordan following in the restaurant industry?

Accepted Answer

A)   Cost leadership
B)   Differentiation
C)   Focused cost leadership
D)   Focused differentiation
E)   Both cost leadership and differentiation simultaneously D

Question 4

Market segmentation is best described as what type of process?

Accepted Answer

A)   Static
B)   Regressive
C)   Evolving
D)   Normative
E)   Revolving

Question 5

For each of the generic strategies-cost leadership,differentiation,and focus-describe one advantage and one disadvantage.

Accepted Answer

The answer of For each of the generic strategies-cost leadership,differentiation,and...

Question 6

When technological change is low and customer needs are well established and standardized,the most appropriate generic strategy to pursue is

Accepted Answer

A)   market concentration.
B)   differentiation.
C)   focus.
D)   asset reduction.
E)   cost leadership.

Question 7

Companies that successfully pursue a cost leadership strategy generally have a distinctive competency in research and development.

Accepted Answer

A) True 
 B)False

Question 8

Mercedes-Benz automobiles are a good example of

Accepted Answer

A)   moderately priced products.
B)   imitative products.
C)   differentiated products.
D)   products that are struggling to differentiate.
E)   highly competitive products.

Question 9

Within the funiture market,Jacob and Edward are both consumers who want to buy furniture for its looks rather than its functionality.Jacob and Edward are both members of the same customer group.

Accepted Answer

A) True 
 B)False

Question 10

Lucy's Swimwear Boutique offers swimwear that is targeted at affluent people who can afford to buy expensive,handmade swimsuits.Which of the following approaches to market segmentation is Lucy's Swimwear Boutique using?

Accepted Answer

A)   No market segmentation
B)   Low market segmentation
C)   Medium market segmentation
D)   High market segmentation
E)   Focused market segmentation

Question 11

A company pursuing a cost-leadership strategy does which of the following?

Accepted Answer

A)   Includes substandard components in the product to keep costs low
B)   Chooses strategies that keep costs as low as feasible and are effective
C)   Keeps advertising expenses at a maximum
D)   Relies on patent protections to keep costs low
E)   None of these

Question 12

Lilly's Beauty Company sells haircare products such as shampoo,conditioner,and hairspray.These products are targeted at the average or typical customer and prices are typically low in comparison to other haircare products.Which of the following approaches to market segmentation is Lilly's Beauty Company using?

Accepted Answer

A)   No market segmentation
B)   Low market segmentation
C)   Medium market segmenation
D)   High market segmentation
E)   Focused market segmentation

Question 13

A firm's business model should contain three components: what is to be satisfied,who is to be satisfied,and how they will be satisfied.

Accepted Answer

A) True 
 B)False

Question 14

Yankee Candle Company offers customers candles that burn for 50-60 hours,much longer than most department store candle brands.Therefore,customers are willing to pay a higher price for these candles.Yankee Candle Company is utilizing which of the following?

Accepted Answer

A)   Cost leadership
B)   Focused cost leadership
C)   Market segmentation
D)   Product differentiation
E)   A strategic group

Question 15

Differentiation leads to high brand loyalty,which in turn significantly increases the threat of new firms entering the industry.

Accepted Answer

A) True 
 B)False

Question 16

Fortunately,focusers are not vulnerable to shifting consumer tastes,because of brand loyalty that comes with focused strategy.

Accepted Answer

A) True 
 B)False

Question 17

Once a focused differentiator gains competitive advantage in its market,the threat of competitive rivalry is greatly reduced.

Accepted Answer

A) True 
 B)False

Question 18

Ryanair,based in Dublin,Ireland,used the cost-leadership business model pioneered by Southwest Airlines in the United States to become a leading player in the European air travel market.

Accepted Answer

A) True 
 B)False

Question 19

The main difference between companies following a cost leadership strategy and those following a focused cost leadership strategy is

Accepted Answer

A)   standardized market price.
B)   industry life cycle stage.
C)   degree of market segmentation.
D)   age of the market.
E)   market trajectory.

Question 20

A shrinking market segment poses the greatest threat to a company pursuing which of the following strategies?

Accepted Answer

A)   Cost leadership
B)   Differentiation
C)   Focused differentiation
D)   Growth
E)   Both cost leadership and differentiation simultaneously

Exam 5: Building Competitive Advantage Through Business-Level Strategy

To create a successful business model,managers must choose a set of business-level strategies that

A market segment consists of a group of

Jordan's ice cream stand offers different combinations of premium flavors,cones,and toppings to create hundreds of extravagant,customized products.Which generic strategy is Jordan following in the restaurant industry?

Market segmentation is best described as what type of process?

For each of the generic strategies-cost leadership,differentiation,and focus-describe one advantage and one disadvantage.

When technological change is low and customer needs are well established and standardized,the most appropriate generic strategy to pursue is

Companies that successfully pursue a cost leadership strategy generally have a distinctive competency in research and development.

Mercedes-Benz automobiles are a good example of

Within the funiture market,Jacob and Edward are both consumers who want to buy furniture for its looks rather than its functionality.Jacob and Edward are both members of the same customer group.

Lucy's Swimwear Boutique offers swimwear that is targeted at affluent people who can afford to buy expensive,handmade swimsuits.Which of the following approaches to market segmentation is Lucy's Swimwear Boutique using?

A company pursuing a cost-leadership strategy does which of the following?

A firm's business model should contain three components: what is to be satisfied,who is to be satisfied,and how they will be satisfied.

Yankee Candle Company offers customers candles that burn for 50-60 hours,much longer than most department store candle brands.Therefore,customers are willing to pay a higher price for these candles.Yankee Candle Company is utilizing which of the following?

Differentiation leads to high brand loyalty,which in turn significantly increases the threat of new firms entering the industry.

Fortunately,focusers are not vulnerable to shifting consumer tastes,because of brand loyalty that comes with focused strategy.

Once a focused differentiator gains competitive advantage in its market,the threat of competitive rivalry is greatly reduced.

Ryanair,based in Dublin,Ireland,used the cost-leadership business model pioneered by Southwest Airlines in the United States to become a leading player in the European air travel market.

The main difference between companies following a cost leadership strategy and those following a focused cost leadership strategy is

A shrinking market segment poses the greatest threat to a company pursuing which of the following strategies?