It is okay for firms to create expectations that exceed the service the firm can or will
offer if it will attract customers.
Stakeholders of an organization include stockholders, customers and creditors, but not
competitors.
While vision and mission statements are part of numerous internal reports, they should
never be displayed in a firm’s premises.
Companies are avoiding outsourcing more and more because it is more expensive than
traditional methods and it does not allow a firm to concentrate on core competencies.
Jiffy Lube International would be a good example of a firm seeking the best-value focus
strategy.
The utility statement, “Do not offer me attractive looks; offer me clothes,” is relevant in
developing a mission statement.
Organizations that conduct business operations across national borders are called
international firms or multinational corporations.
Having a clear mission and vision can provide a basis for a company’s internal and
external assessment.
The BCG Matrix requires more information about the divisions than the IE Matrix.
A firm’s concern for employees in a mission statement addresses the question, “Is the
firm responsive to social, community, and environmental concerns?”
Step 1 of a QSPM assigns weights to each key external and internal factor.
The first step in performing projected financial analysis is to
A) prepare the projected balance sheet.
B) take an inventory of goods.
C) estimate increases in debt.
D) prepare the projected income statement.
E) calculate the projected net income.
What is NOT a guideline given for effective strategic planning?
A) Continually strengthen the “good ethics is good business” policy.
B) It should not include jargon or arcane planning language.
C) It should not be too formal, predictable, or rigid.
D) It should welcome bad news.
E) It should be controlled by “technicians.”
What corrective actions might a firm take during strategy evaluation?
A) Revise the business mission
B) Issue stock
C) Revise objectives
D) Sell a division
E) All of the above
________ exemplifies the complexity of relationships among the functional areas of
business.
A) Government auditing
B) External auditing
C) Financial ratio analysis
D) Environmental scanning
E) Distribution strategy
In general, U.S. managers feel the day has been productive if it is spent
A) rushing to meetings and conferences.
B) resting.
C) listening.
D) meditating.
E) thinking.
Which of the following U.S. industries is NOT yet greatly challenged by foreign
competitors?
A) Aircraft manufacturing
B) Auto manufacturing
C) Heavy equipment manufacturing
D) Tire manufacturing
E) Furniture manufacturing
In most industries, the major costs of producing a product or service are incurred within
A) marketing.
B) management.
C) research and development.
D) operations.
E) management information systems.
Mass communication and high technology have ________ in diverse cultures
worldwide.
A) created similar patterns of consumption
B) resulted in highly individualized patterns of consumption
C) rendered patterns of consumption identical
D) had little to no effect on patterns of consumption
E) ignored patterns of consumption
According to Drucker, which question is synonymous with asking “What is our
mission?”
A) What is our business?
B) How can we improve ourselves?
C) What do we want to become?
D) Who are our stakeholders?
E) How can we increase profitability?
If you discover during the course of strategy evaluation that major changes have
occurred in the firm’s internal strategic position, you should
A) continue on the present strategic course.
B) wait until the next quarter to see if things revert.
C) take corrective actions.
D) follow the original strategic plan.
E) none of the above
Marketing managers in Japan see making a sale ________ the selling process.
A) as the beginning of
B) as the end of
C) as the midpoint of
D) as unrelated to
E) None of the above
A divisional structure by product is most effective when
A) special emphasis needs to be placed on specific products.
B) an organization offers few products.
C) an organization’s products or services differ substantially.
D) special emphasis needs to be placed on specific services.
E) all of the above
Establishing objectives is a
A) executive-only activity.
B) centralized activity.
C) decentralized activity.
D) centralized-decentralized activity.
E) command-and-control activity.
Which organizational structure has the disadvantage of ambiguous roles for senior
executives?
A) Functional
B) Divisional
C) Strategic business unit
D) Matrix
E) Process
What is NOT one of Michael Porter’s five competitive forces?
A) New entrants
B) Rivalry among existing firms
C) Bargaining power of unions
D) Bargaining power of suppliers
E) Bargaining power of buyers
If an initial stock issuance is $800,000, what would be the expected cost paid to
lawyers, accountants, and underwriters, based on the average for IPOs in this range?
A) $20,000
B) $40,000
C) $80,000
D) $200,000
E) $400,000