An appropriate reason to diversify is to pool the risk from several business ventures in
order to create a more stable income stream.
General managers bear responsibility for the overall performance of the company or for
one of its major self-contained subunits or divisions.
A cost leader must respond to the strategic moves of its differentiated competitors.
The great virtue of scenario planning is that managers must think outside the box to
anticipate what they might do in different situations.
Deregulation of the mortgage industry is an example of how political and legal forces
can impact an industry.
Once a focused differentiator gains competitive advantage in its market, the threat of
competitive rivalry is greatly reduced.
The law of diminishing returns states that marginal costs fall as a company tries to
expand output.
Organizational structure contributes to the strategy formulation by providing the
framework of tasks and roles that reduces transaction difficulties and allows employees
to think and behave in ways that allow a company to achieve superior performance.
The punctuated equilibrium view can also be described as a freezing but not unfreezing
process in an industry’s life cycle.
Unfortunately, values are personal and have little to do with organizational culture or
competitive advantage.
All stakeholders are in an exchange relationship with the company.
In the fashion industry, the time required to take a new product from design inception to
placement in a retail store is known as customer response time.
Which of the following companies exemplifies the trend toward national markets
merging into one large global marketplace?
A.McDonald’s
B.Starbucks
C.Coca-Cola
D.Nokia
E.All of these
Taj is employed at Global Tech, an organization that operates within the technology
industry. He is an experienced corporate manager who assumes the responsibility for
managing complex transfers between two or more divisions. Taj is in a(n) _____ role.
A.global
B.division
C.direct contact
D.iasion
E.integrating
All of the following considered high-technology industries except:
A.Computers
B.Telecommunications
C.Consumer electronics
D.Pharmaceuticals
E.Retail clothing
Which of the following is not a barrier to entry?
A.Economies of scale
B.Brand loyalty
C.Absolute cost advantages
D.High customer bargaining power
E.High customer switching costs
To create a successful business model, managers must choose a set of business-level
strategies that
A.allow the company to better compete with rivals within an industry.
B.help them decide what businesses to enter and exit.
C.help build an organizational structure that contains multiple businesses.
D.work together to give a company a competitive advantage over its rivals.
E.help it to diversify to better leverage distinctive competencies.
Self-managing work teams
A.increase per-unit costs of manufactured items.
B.perform all workplace tasks except the making of hiring decisions.
C.increase the cycle time of manufacturing items.
D.require greater task specialization by members of the team.
E.tend to increase productivity.
In joint venturing, two or more companies typically agree to
A.merge within twelve months.
B.divide their lists of customers.
C.pool specific resources and capabilities.
D.divide a specific market between the two companies.
E.pool the results of entrepreneurship at each company.
Which of the following statements about customer focus is false?
A.It must start at the top of the organization.
B.It is a central part of TQM.
C.It can be facilitated by soliciting feedback from the customer.
D.It requires that all employees see the customer as the focus of their activity.
E.It can be achieved by mass customization.
Which diversification strategy is based on the idea that the company creates value by
applying the distinctive competencies it developed in one line of business to another
business activity?
A.A technology acquisition strategy
B.Related diversification
C.A restructuring strategy
D.Total diversification
E.A taper diversification strategy
Leslie is the owner of Crafts and Things, a local craft store that sells homemade gifts
such as jewelry and quilts. Recently, there has been an increase in the price of the items
that Leslie uses to make her crafts, such as beads and yarn. The rising cost of these
items represent a(n) _____ to Leslie€s business.
A.opportunity
B.threat
C.cost advantage
D.rivalry
E.strength
A company that enters a foreign market by entering into a licensing agreement with a
local company
A.can realize location economies.
B.can engage in global strategic coordination.
C.can realize experience-curve effects.
D.risks losing control over its technology to the venture partner.
E.can engage in global strategic coordination and realize experience-curve effects.
In which of the following industry environments are new ventures most likely to be
favored over acquisitions as a means of entering a new business area?
A.An embryonic industry
B.An industry in its later stages of growth
C.An industry passing through the shakeout stage
D.A mature industry
E.A declining industry
Which of the following is not a risk of exporting?
A.Tariff barriers
B.Transportation costs
C.Location diseconomies
D.Prime interest rates
E.Delegation of marketing activities to a local agent
Host government demands generally
A.increase pressures for local responsiveness.
B.increase pressures for cost reductions.
C.discourage foreign companies from operating in the home country.
D.impede a company’s ability to minimize its transaction costs.
E.impede a company’s ability to differentiate its product offering across national
borders.