Question 1

Corporate retreats do not

Accepted Answer

A)  permit companies to discuss larger marketplace trends. 
B)  guarantee positive consumer response to new products. 
C)  give companies an opportunity to look beyond their own industries. 
D)  oblige management to automatically change strategy.

Question 2

Two non-competing global firms meet quarterly to discuss multiple perspectives on world trends.This is an example of how to improve

Accepted Answer

A)  stakeholder management. 
B)  perceptual acuity. 
C)  internal scanning. 
D)  financial returns.

Question 3

It is important to question the reliability of forecasts because

Accepted Answer

A)  if predictions are too low, a company like Motel 6 might build too many units and thus have a surplus of capacity. 
B)  uncertainty is black and white, and therefore the gray areas are unimportant. 
C)  underestimating uncertainty can lead to good competitive strategies. 
D)  the growth new industries, such as that of telecommunications, cannot be predicted.

Question 4

Referring to the textbook Exhibit 2.7 The World Automobile Industry: Strategic Groups,which strategic group is the largest in terms of breadth of product line?

Accepted Answer

A)  Ferrari, Lamborghini, Porsche 
B)  Toyota, Ford, General Motors, Chrysler, Honda, Nissan 
C)  Chery, Geely, Tata Motors 
D)  Mercedes, BMW, Audi

Question 5

Strategic groups consist of firms that are more ________ to each other than firms that are not.

Accepted Answer

A)  familiar 
B)  similar 
C)  friendly 
D)  useful

Question 6

Elements of the five forces can be quantified.This is important for analyzing industry structure.Which of the following is not an example of an element that can be quantified?

Accepted Answer

A)  the percentage of the buyer total cost accounted for by the industry product 
B)  the percentage of industry sales required to fill a plant or operate a logistical network to efficient scale 
C)  the buyer switching cost 
D)  the governmental regulatory policy

Question 7

Which of the following firms would likely pose the least competitive threat?

Accepted Answer

A)  a firm in the same industry and in the same strategic group 
B)  a competitor to your product where a high switching cost exists 
C)  a firm that produces substitute goods to your product line 
D)  a firm in the same industry and in the nearest strategic group looking to join your group

Question 8

The Porter five-forces model is designed to help us understand how social attitudes and cultural values impact U.S.businesses.

Accepted Answer

A) True 
 B)False

Question 9

Referring to the textbook Exhibit 2.7 The World Automobile Industry: Strategic Groups,which strategic group is the smallest in terms of breadth of product line?

Accepted Answer

A)  Hyundai, Kia 
B)  Toyota, Ford, General Motors, Chrysler, Honda, Nissan 
C)  Chery, Geely, Tata Motors 
D)  Mercedes, BMW, Audi

Question 10

The threat of new entrants is high when there are

Accepted Answer

A)  high capital requirements. 
B)  low economies of scale. 
C)  high switching costs. 
D)  high differentiation among competitor products and services.

Question 11

The bargaining power of the buyer is greater than that of the supplier when

Accepted Answer

A)  volume of purchase is low. 
B)  the buyer profit margin is low. 
C)  cost savings from the supplier's product are minimal. 
D)  threat of backward integration by buyers is low.

Question 12

Environmental scanning and competitor intelligence provide important inputs for forecasting activities.

Accepted Answer