Unlock document.
This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
Chapter 07 - Long-Term Objectives and Strategies
52. (p. 210) The grand strategy involving the acquisition of businesses that supply the firm with
inputs such as raw materials is termed:
53. (p. 210) If a donut corporation acquires a flour company, this strategy would be called:
54. (p. 210) If a shirt manufacturer acquired a chain of men's clothing outlets, this would be an
example of:
55. (p. 212) When the principal or sole consideration of the acquiring firm is the profit pattern of
the venture, the grand strategy is usually one of:
56. (p. 212) Conglomerate diversification is concerned primarily with:
57. (p. 212) If a firm plans to acquire a business because it represents the most promising
investment opportunity available, the grand strategy is:
58. (p. 211) When diversification involves additions of a business related to the firm in terms of
technology, markets or products, it involves:
59. (p. 211) With this type of grand strategy, the new businesses selected possess a high degree
of compatibility with the current business:
60. (p. 212) A spin-off usually indicates:
61. (p. 212) The motivations of acquiring firms using diversification strategy include:
62. (p. 212) Concentric diversification may be undertaken as a grand strategy because the
acquiring firm wishes to:
63. (p. 213) According to researchers, the grand strategies of retrenchment/turnaround are most
often accomplished in extreme circumstances through which of the following?
64. (p. 213) The type of strategy typically accomplished either by cost reduction and/or asset
reduction is known as:
65. (p. 213) Retrenchment is typically accomplished through:
66. (p. 217) When the grand strategy is liquidation, the business is:
67. (p. 216) The grand strategy that involves the sale of a business or major business component
is called:
68. (p. 217) If a business is sold for its tangible asset value, the strategy is one of:
69. (p. 214) The second phase of the turnaround process is called:
70. (p. 217) As a long-term strategy, this minimizes the loss to all stockholders of the firm:
71. (p. 218) When a firm attempts to persuade its creditors to temporarily freeze their claims
while it undertakes to reorganize and rebuild its operations more profitably, this form of
bankruptcy is called:
72. (p. 217) Which is considered the least attractive grand strategy?
73. (p. 218) When a firm agrees to a complete distribution of its assets to creditors, most of
whom will receive a small fraction of the amount that they are owed, this form of bankruptcy
is called a:
74. (p. 218) Which of the following types of bankruptcies provides the firm with a conditional
second chance?
75. (p. 218) More than 75 percent of financially desperate firms file for a:
76. (p. 220) Chapter 11 of the Bankruptcy Code deals with:
77. (p. 220) Which kind of bankruptcy provides time and protection to the debtor firm?
78. (p. 221) When companies lack a necessary component for success in a particular
environment, they may participate in types of joint ventures which include:
79. (p. 221) Occasionally, two or more capable companies lack a necessary component for
success in a particular competitive environment. The optimal strategy in such a case would
be:
80. (p. 224) _______ is partnerships that exist for a defined period during which partners
contribute their skills and expertise to a cooperative project.
81. (p. 224) Strategic alliances are distinguished from joint ventures because:
82. (p. 224) Consortia are:
83. (p. 225) Strategic choice decision making leads to the selection of long-term objectives and
grand strategies. This process is:
84. (p. 225) A chaebol:
85. (p. 225) A Japanese keiretsu:
Chapter 07 - Long-Term Objectives and Strategies
Essay Questions
86. To achieve long-term prosperity, strategic planners commonly establish long-term
objectives in which seven areas? Describe each briefly.
Learning Objective: 1
87. What seven criteria should be used in preparing long-term objectives? What is the purpose
of each?
Learning Objective: 2
88. Describe the balanced scorecard as a framework to translate a strategy into operational
Learning Objective: 2
89. How does low-cost leadership differ from a differentiation strategy and a focus strategy?
90. What is the premise behind the value disciplines proposed by Treacy and Wiersema?
Identify all three and discuss each briefly.
Learning Objective: 4
91. What is meant by "concentrated growth" strategy? What are the risks and rewards of this
strategy?
Learning Objective: 5
92. What conditions favor the use of a concentrated growth strategy?
Learning Objective: 5
93. Compare and contrast market development and product development, citing one example
of each.
Learning Objective: 5
94. What is the grand strategy of innovation? How is it different from product innovation?
Learning Objective: 5
95. Using an example, describe the grand strategy of horizontal acquisition.
96. What strategy is being used when the firm acquires other firms that supply it with inputs
or are customers for its outputs? Describe the reasons for choosing this strategy.
Learning Objective: 5
97. How is concentric diversification different from conglomerate diversification?
Learning Objective: 5
98. Describe some general motivations behind diversifying a firm.
Learning Objective: 5
99. Describe how the grand strategy of “turnaround” can help a firm that finds itself with
declining profits.
100. Differentiate between joint ventures and strategic alliances. Describe the comparative
benefits of each type of strategy.
224.
