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Chapter 02 The External and Internal Environments Answer Key
True / False Questions
1.
Organizations are open systems that affect and are affected by their external
environments.
2.
Raw materials are an example of inputs.
3.
When investors bid up stock prices, companies have less capital to fuel their strategies.
4.
A more diverse workforce presents managers with challenges as well as opportunities.
5.
According to Michael Porter's model, the competitive environment includes rivalry among
current competitors and the impact of new entrants, substitute and complementary
products, suppliers, and customers.
6.
Organizations are at an advantage if they depend on a single powerful supplier because
such dependency ensures consistency.
7.
Environmental uncertainty refers to the lack of information needed to understand or
predict the future.
8.
Enrico has used environmental scanning to gather information that will help him make his
company more competitive. This is an example of cognitive intelligence.
9.
April, a manager in a call center, encourages her employees to solve customers' problems
without her approval of the particular situation. In this case, April is trying to empower her
employees.
10.
A strong organization culture is one in which lower-level employees do not concern
themselves with the firm's goals, priorities, and practices because management deals with
those issues.
Multiple Choice Questions
11.
What term is used to describe all the relevant forces outside an organization's
boundaries?
12.
A firm's _____ includes its rivals, suppliers, customers, new entrants, substitutes, and
complementary products.
13.
Stylin' Footwear buys leather and lesser quantities of cork, elastic, metal buckles, and
other materials to manufacture shoes. Which of the following is Stylin's Footwear's
output?
14.
Although a top executive team may have unique _____ strengths and ideas about its goals,
it must consider _____ factors before taking action.
15.
Which of the following statements about the impact of the stock market is true?
16.
A failure to develop a strategy that incorporates _____ may doom a firm to obsolescence.
17.
Which of the following is a U.S. government policy or action that is most likely to provide
an opportunity for businesses?
18.
What are demographics?
19.
How is immigration affecting U.S. demographics?
20.
Which of the following was introduced as the result of an evolving societal trend?
21.
Which of the following was designed to help managers analyze the competitive
environment and adapt to or even influence the nature of competition?
22.
Which of the following is a barrier to entry?
23.
Klaus's office has always used Tangerine computers. His technical people have suggested
that he switch all his employees over to Vale computers. Klaus is reluctant because it will
mean not only replacing all the computers but also buying all new software and taking the
time to train everyone. Klaus is worried about
24.
Supply chain management refers to the
25.
The goal of _____ is having the right product in the right quantity at the right place at the
right cost.
26.
_____ means searching for and sorting through information about the environment.
27.
A human resources manager is considering changing her company's vacation policy.
Before she makes a proposal to the senior executive team, she researches the vacation
policies of other leading companies in her industry. This is an example of _____.
28.
What is the purpose of benchmarking?
29.
Diversified Industries decides to use the expertise it has from its canned-pet-food division
and its health-food division to enter the fast-growing market for fresh, natural pet foods.
This is an example of
30.
Which of the following is said to occur when two or more firms combine?
31.
Which of the following is the best description of organizational culture?
