Which of the following is NOT one of the steps followed in the benchmarking process?
A) Develop tactical programs for closing performance gaps.
B) Implement tactical programs, measure the results, and compare the results with those
of the best-in-class company.
C) Implement activity-based costing.
D) Identify the area or process to be examined.
E) Calculate the differences among the company’s performance measurements and
those of the best-in-class company.
Answer:
Economist Milton Friedman has argued that a business’s only responsibility is to
A) maximize profits and stay within the rules of the game.
B) sustain its market share.
C) promote the welfare of society.
D) satisfy its employees.
E) satisfy its customers.
Answer:
Which financial ratio shows the after-tax earnings generated for each share of common
stock?
A) return on investment
B) return on equity
C) gross profit margin
D) earnings per share
E) net profit margin
Answer:
The stability strategy is appropriate for all of the following circumstances EXCEPT
A) useful in the short-run but can be dangerous if followed too long.
B) most appropriate for reasonably successful corporations in a reasonably predictable
environment.
C) when a firm is continuing its current activities without a significant change in
direction.
D) appropriate when the industry is in decline.
E) popular with small business owners who have found a niche and are happy with their
success.
Answer:
Which financial ratio measures the utilization of all of the company’s assets?
A) days of inventory
B) asset turnover
C) inventory turnover
D) fixed asset turnover
E) average collection period
Answer:
According to the BCG Growth Share Matrix, those products with low market share in
an unattractive industry that do NOT have the potential to bring in much cash are called
A) cash cows.
B) lost leaders.
C) dogs.
D) question marks.
E) stars.
Answer:
According to the text, one of the primary responsibilities of top management in
strategic management is
A) ensuring that day-to-day operations are efficient and well run.
B) providing executive leadership.
C) balancing the budget.
D) managing the short-term planning process.
E) making all important decisions.
Answer:
When Renault purchased a controlling interest in Japan’s Nissan Motor Company to
form one successful auto group from two with particular sensitivity to Nissan’s culture,
which approach to managing culture was employed?
A) separation
B) integration
C) deculturation
D) assimilation
E) segmentation
Answer:
Members of the European Union (EU) include all of the following EXCEPT
A) Ireland.
B) Malaysia.
C) Belgium.
D) France.
E) Slovakia.
Answer:
When a company determines that a competency provides a competitive advantage,
Barney refers to this issue as
A) value.
B) rareness.
C) imitability.
D) organization.
E) durability.
Answer:
A company which imitates the products of competitors is referred to as a
A) technological follower.
B) technological opportunist.
C) technological leader.
D) technological manufacturer.
E) technological entrepreneur.
Answer:
The process by which strategies and policies are put into action through the
development of programs, budgets, and procedures is
A) strategy formulation.
B) strategy control.
C) strategy implementation.
D) strategy development.
E) strategy evaluation.
Answer:
Which of the following is NOT considered an adequate measure by itself of corporate
performance?
A) ROI
B) EPS
C) ROE
D) operating cash flow
E) all of the above
Answer:
Some takeover specialists look at the amount of money a new owner can take out of the
firm without harming the business. This is known as
A) leveraged buyout.
B) operating cash flow.
C) free cash flow.
D) dividends.
E) shareholder measure.
Answer:
When Dell Computer’s customers use the Internet to design their own computers, this
demonstrates which manufacturing strategy?
A) continuous improvement
B) mass production
C) job shop
D) mass customization
E) just-in-time
Answer:
When General Motors considers making its own automotive parts, Delphi Automotive
Supply Company would be concerned with the
A) bargaining power of suppliers.
B) bargaining power of buyers.
C) rivalry among existing competitors.
D) threat of substitutes.
E) threat of new entrants.
Answer:
According to the BCG Growth Share Matrix, products that typically bring in far more
money than is needed for maintenance of their market share are called
A) cash cows.
B) lost leaders.
C) dogs.
D) question marks.
E) stars.
Answer:
According to a 2011 National Business Ethics survey, what percent of respondents who
observed corporate misconduct rated their cultures as weak?
A) 90
B) 70
C) 50
D) 30
E) 10
Answer:
Flexible manufacturing emphasizes
A) high-volume output of mass produced products.
B) the cost advantages of an intermittent system with the customer-oriented advantages
of a continuous system.
C) the learning curve is longer since technology is automated.
D) economies of scope over economies of scale.
E) economies of scale over economies of scope.
Answer:
Which one of the following is NOT a characteristic of a firm that has chosen a captive
company strategy?
A) It is most appropriate for a company with a strong competitive position in a growing
industry.
B) The firm reduces its functional activities to reduce costs.
C) The firm gains a certainty of sales and production in return for becoming heavily
dependent upon another firm for at least 75% of its sales.
D) One of its customers makes up a large percentage of the company’s sales and wants
the company to keep operating as its supplier.
E) Management desperately seeks an “angel” to guarantee the company’s continued
existence.
Answer:
When Kimberly-Clark introduced Huggies disposable diapers against Procter &
Gamble’s market leading Pampers, they were using the offensive tactic known as a(n)
A) flanking maneuver.
B) frontal assault.
C) encirclement.
D) bypass attack.
E) guerilla attack.
Answer:
What is the activity that occurs in Stage I of international development?
A) The company invests in production facilities in key countries.
B) The company exports, but trade is minor and handled by an export department.
C) The company establishes its own export division with sales offices in other
countries.
D) The company operates in a global industry and establishes worldwide personnel,
R&D, and financing strategies.
E) The company establishes local operating divisions in host countries to better serve
individual country markets.
Answer:
One research study of TQM successes and failures concluded that a key ingredient in
TQM programs is
A) effective communication in all levels of management.
B) excellent customer satisfaction.
C) top management.
D) formidable manufacturing practices.
E) respected lower level employees.
Answer:
Ford Motor Company’s use of company resources to build its River Rouge Plant outside
of Detroit so that iron ore could enter into one end of the plant and a finished
automobile could exit out of the other end is called
A) vertical growth.
B) tapered integration.
C) horizontal integration.
D) external vertical integration.
E) quasi-integration.
Answer:
Which one of the following is NOT one of the questions that management should raise
in their attempt to assess the importance to the corporation of stakeholders’ concerns?
A) Which stakeholder group should be represented on the board of directors?
B) How will this decision affect each stakeholder?
C) How much of what the stakeholders want are they likely to get under a certain
alternative?
D) What are the stakeholders likely to do if they don’t get what they want?
E) What is the probability that the stakeholders will follow through on their demand?
Answer:
Product engineering, creative flair, and strong cooperation from channels are commonly
required skills and resources for which of Porter’s generic strategies?
A) cost leadership
B) differentiation
C) cost leadership focus
D) differentiation focus
E) collusion
Answer:
One of the big common mistakes by corporations sending executives on global
assignments is NOT
A) raising their salaries.
B) educating executives about customs and values in other countries.
C) providing training for the regulatory environment.
D) providing excellent health care.
E) giving executives the opportunity to visit home.
Answer:
The movement of workers through several jobs to increase variety is referred to as
A) job combination.
B) job rotation.
C) job enrichment.
D) job enlargement.
E) job motivation.
Answer:
A corporation’s ability to exploit its resources is referred to as its
A) resources.
B) capabilities.
C) core competencies.
D) critical success factors.
E) key performance factors.
Answer:
Evaluation and control information consists only of performance data.
Answer:
Among the most useful and important documents that can be used to understand why
actions were taken are
A) news releases.
B) product specification reports.
C) its corporate history.
D) annual reports.
E) 10-Q forms.
Answer:
The particular capabilities and resources a firm possesses and the superior way in which
they are used is called
A) differentiating capabilities.
B) distinctive competencies.
C) situational proficiency.
D) core competencies.
E) distinctive characteristics.
Answer:
A highly developed international company with a deep involvement throughout the
world, plus a worldwide perspective in its management and decision making is called
a(n)
A) international corporation.
B) multidomestic corporation.
C) multinational corporation.
D) global corporation.
E) Stage IV corporation.
Answer:
“Days of inventory” is an example of a(n)
A) leverage ratio.
B) liquidity ratio
C) activity ratio.
D) asset management ratio.
E) profitability ratio.
Answer:
Which of the following companies was cited by the text as an example of a company
which does its best to consider its responsibilities to its primary and secondary
stakeholders when making strategic decisions?
A) McDonald’s
B) Maytag
C) Johnson & Johnson
D) Microsoft
E) Enron
Answer: