1. Growing profit is the ultimate goal of any company.
a. True
b. False
4. To increase profitability, we have to increase sales volume or raise prices.
a. True
b. False
5. Low prices and low margins necessitate the hassle of having to deal in large volume.
a. True
b. False
6. Customers usually believe that high prices are a cue to higher quality.
a. True
b. False
7. Product development is the riskiest strategy in Ansoff’s product-market growth matrix.
a. True
b. False
8. It is a good idea to try new products and new customer bases at the same time.
a. True
b. False
9. Arlin owns a firm that specializes in producing and marketing cosmetics and hair care products. Arlin wants
to examine his portfolio. The BCG matrix is the strategic framework you should recommend to Arlin to
evaluate his portfolio.
a. True
b. False
10. The four classes in the BCG matrix are a star, a dog, a question mark, and a cash cow. All of the classes are
essentially equal.
a. True
b. False
11. Using the BCG matrix, a company’s brands or products are classified solely according to whether each has a
strong or weak market share.
a. True
b. False
12. A brand with small share in a market that is NOT growing is called a “dog.”
a. True
b. False
13. A brand with a relatively large share in a growing market is called a “star.”
a. True
b. False
14. In the spirit of a product’s life cycle, withdrawing marketing support can propel a brand into faster decline.
a. True
b. False
15. Cash cows don’t need much marketing attention.
a. True
16. Brands referred to as “dogs” should be moved “north” to become cash cows.
a. True
b. False
17. In the General Electric model, judgments about the brand’s performance are implicit, not explicit.
a. True
b. False
18. In the General Electric model, the dimensions that are measured are market strength and business
attractiveness.
a. True
b. False
19. Whereas the cost leadership and differentiation approaches are said to be broad, the focused strategy is
narrower.
a. True
b. False
20. Cost leadership means distinguishing one’s products as unique in the industry.
a. True
b. False
21. If a company’s mantra is “We’re efficient,” it is probably pursuing a focus strategy.
a. True
b. False
22. The Treacy and Wiersema strategies are operational leadership, product excellence, and customer intimacy.
a. True
b. False
23. Operational excellence involves knowing your customers’ needs and tailoring your product to meet those
needs.
a. True
b. False
24. Reasons to revisit strategic planning questions are easily discoverable by SWOT analyses.
a. True
b. False
25. Strategic planning involves a reflection on our corporate identity.
a. True
b. False
26. Some companies revisit strategic assumptions from time to time just because they are thoughtful and
reflective.
a. True
b. False
27. A company’s tendency toward offensive or defensive actions correlates with its size.
a. True
b. False
28. All firms assume either a leader or follower status in the marketplace.
a. True
b. False
29. The first company to market a new product or idea is in a good position because truly new products always
capture the attention of customers.
a. True
b. False
30. Many companies want to be considered quick-followers because it is a safer route to success than being the
first to market with an innovative product.
a. True
b. False
31. It’s completely possible for a company to be a leader for some of its brands and more of a follower for its
other brands.
a. True
b. False
32. An important assessment in strategic thinking is to know your company’s strengths and weaknesses.
a. True
b. False
33. Sales goals should be stated in terms of profits.
a. True
b. False
34. Customer satisfaction is a major goal classification.
a. True
b. False
35. Goals regarding better promotional communications can include spending advertising dollars more wisely
and figuring out which media make the most sense to customer segments.
a. True
b. False
36. Jacques is contemplating the possible moves his camping equipment firm can make to become more
competitive in the marketplace. At the highest level of analysis, there are really three strategies available for
Jacques’s firm to achieve its goals: (1) do nothing, (2) do nothing different from the status quo, and (3) do
something different.
a. True
b. False
37. When business drops or competitors step up, a status quo strategy will yield good results.
a. True
b. False
38. Strategic goals must integrate all 4Ps.
a. True
b. False
39. Typically, we have control over all the 5Cs.
a. True
b. False
40. When the gauges on a company dashboard head to the center or to the left, it means it’s time to panic.
a. True
b. False
41. What is a company’s ultimate goal?
a. growing profit
b. expanding into as many segments as possible
c. being a leader
d. pleasing customers
42. Which of the following is the correct formula for sales revenue?
a. Sales volume – Cost
b. Sales volume × Price
c. Sales volume + Price
d. Sales volume/Cost
a. (Sales volume + Price) / (Variable costs × Fixed costs)
b. (Sales volume + Price) – (Variable costs × Fixed costs)
c. (Sales volume × Price) / (Variable costs + Fixed costs)
d. (Sales volume × Price) – (Variable costs + Fixed costs)
44. If a company wants to increase its profitability, it needs to __________ sales volume, __________ prices, or
__________ costs.
a. increase, change, decrease
b. decrease, change, increase
c. change, decrease, increase
d. decrease, increase, change
45. Which of the following is the correct formula for Variable Costs?
a. Variable unit cost + Sales volume (in units)
b. Variable unit costs × Sales volume (in units)
c. Variable unit costs/Sales volume (in units)
d. Variable unit costs – Sales volume (in units)
46. Looking for suppliers who are cheaper than our current ones but still high quality is an example of a way to
a. increase sales volume.
b. change our prices.
c. decrease variable costs.
d. decrease fixed costs.
47. The CEO of Winchester Inc. always says, “It’s all about sales growth!” Which marketing strategy
framework is he most likely to use?
a. Ansoff’s product-market growth matrix
b. BCG matrix
c. General Electric model
d. Porter strategies
48. Which strategy in Ansoff’s product-market growth matrix combines current markets and current products?
b. product development
c. market penetration
d. diversify
49. Which strategy in the Ansoff’s product-market growth matrix combines current markets and new products?
a. market penetration
b. product development
c. diversify
d. market development
50. Which strategy in the Ansoff’s product-market growth matrix combines new markets and current products?
a. market development
b. diversify
c. market penetration
d. product development