Which of the following is a characteristic of an implicit contract?
a) It is an understanding between parties in a business relationship
b) It is generally enforceable in court
c) The threat of losing future business makes implicit contracts not viable
d) They are typically used in firms that have little relationship with one another
e) It is an alternative agreement method to the Keiretsu understandings between
members
How does carrying inventories contribute to economies of scale?
a) Increases the interest on the expenses to produce the inventory
b) Inventory depreciates in value while waiting to be used or sold
c) Increases the storage facilities necessary
d) Increases competition with rivals for customers
e) Minimizes the chance of stock-out
What term refers to the costs incurred by buyers when they change to a different
supplier?
a) Switching costs
b) Buyer costs
c) Reputation costs
d) Learning costs
e) Customer costs
At what point can a firm achieve a profit maximizing quantity?
a) MR>MC
b) MC=D
c) MR<MC
d) MR=D
e) MR=MC
Which of the following benefits of diversification explains the idea that corporate
diversification can provide situations where an acquiring firm determines the stock
price for firm they intend to acquire is too low?
a) Use of internal capital markets
b) Economies of scale and scope
c) Economizing on transaction costs
d) Diversifying shareholder portfolios
e) Identifying undervalued firms
Based on Bresnahan and Reiss- study of the relationship between concentration and
prices, how many firms did they determine generally need to be in a market for price
competition to be as intense as it would likely get?
a) 1
b) 2
c) 3
d) 4
e) 5
Which of the following is true about hospital industry profits from 1980 to 2000 and a
five forces analysis?
a) Virtually every factor caused profits to increase
b) Virtually every factor caused profits to decrease
c) Most factors are not applicable to the industry
d) The Value Net cannot be used to evaluate the industry
e) None of t he above
What concept developed by Brandenburger and Nalebuff as a counterpart to Porter’s
five-forces consists of suppliers, customers, competitors and complementors?
a) McKinsey 7-S Framework
b) Value net
c) BCG Market Share Matrix
d) 6 C’s of Marketing
e) 4 P’s of Marketing
Motivation bias and survivor bias are most common in which of the following?
a) Input based scorecards
b) Process based scorecards
c) Scorecards on horizontally differentiated products
d) Scorecards on vertically differentiated products
e) Low cost products
Which of the following is not a product specific fixed cost?
a) The cost to manufacture a special die to make an aircraft fuselage
b) The cost of developing graphics software to facilitate video game development
c) The cost of a one-week training program preceding the implementation of a specific
management initiative
d) The time and expense required to set up a textbook before printing it
e) The cost of administrative expenses