57) Jane has developed a special Italian sauce for pizza. The sauce cannot be easily copied. This is
a(n) ________.
A) orthodox practice
B) unorthodox practice
C) sustainable competitive advantage
D) tangible asset
58) According to the book, the greatest source of sustainable advantage is ________.
A) personal relationships with customers
B) location
C) staffing
D) relationships with vendors
59) All of these are steps in identifying a sustainable competitive advantage EXCEPT
A) develop a list of the business assets and capabilities.
B) develop a list of all potential customers.
C) break the list of capabilities into standard and unique.
D) evaluate the unique resources.
60) ________ are items that include equipment or location.
A) Critical assets
B) System assets
C) Tangible assets
D) Intangible assets
61) ________ are the capabilities and skills of the founder(s) or employees.
A) System assets
B) Critical assets
C) Tangible assets
D) Intangible assets
62) All of these are tangible assets EXCEPT
A) location.
B) industry experience.
C) computer systems.
D) business license.
63) All of these are intangible items EXCEPT
A) industry experience.
B) education.
C) initial financing.
D) name branding.
64) Which of the following is an example of tangible assets?
A) Industry experience
B) Contacts
C) Education
D) All of these
65) Which of the following is an example of intangible assets?
A) Previous start-up experience
B) Unique knowledge of the industry
C) Skill set of founder(s)
D) All of these
66) James has the benefit of gaining customer loyalty by being the first company to bring out a new
gourmet burger. This is a form of ________.
A) sustainable competitive advantage
B) first-mover advantage
C) leader advantage
D) tangible assets advantage
67) ________ are firms that enter a market after the first mover.
A) Second movers
B) Followers
C) Nonleaders
D) Market movers
68) Sally copies Jamie’s hamburger restaurant by starting her own hamburger restaurant on the
other side of town. This is an example of a ________.
A) second mover
B) follower
C) nonleader
D) market mover
69) Which of the following is an example of intangible assets?
A) Inventory
B) Name branding
C) Building location
D) Initial financing
70) Which of the following is an example of tangible assets?
A) Education
B) Previous start-up experience
C) Software and systems for business
D) Unique knowledge of the industry
71) Which of the following is NOT a characteristic of firms that are followers?
A) They do not get the loyalty of customers.
B) They can benefit by learning from the first movers.
C) They are the firms that enter the market after the first mover.
D) They are often more successful than the first-mover firms because they do not repeat their
predecessor’s mistakes.
72) Identify a true statement about competitive advantage.
A) Successful businesses generally have only one source of competitive advantage.
B) Businesses must develop an effective mission statement before developing a list of what might
constitute its competitive advantage.
C) An effective mission statement and sustainable advantage are mutually independent of each
other.
D) The predominant approach used by strategists to gain competitive advantage is the
resource-based perspective.
73) Keith is setting up a new bar in his locality. He knows that there are only a handful of bars in
the area where he wishes to conduct business. He locates his bar at one of the four corners at a busy
intersection. The other three corners are occupied by a clothing outlet, a restaurant, and a library,
respectively. Keith knows that his bar’s location gives him a competitive advantage. In the context
of the components of resource-based analysis, Keith is able to achieve competitive advantage
because his product or service is ________.
A) rare
B) nonsubstitutable
C) durable
D) valuable
74) In the context of the components of resource-based analysis, if a firm’s resource or capability
cannot be replaced easily by something else then it is said to be ________.
A) valuable
B) nonsubstitutable
C) durable
D) rare
75) Richard is the owner of a very popular burger joint in his locality. He knows that his burger
joint’s location and excellent customer service give him a competitive advantage over other burger
joints. He is conducting a research to understand if there are other burger joints that provide the
same sort of services that his joint does. He also intends to know if his competitors have the
financial means to do so and if they seem to care about what his joint offers. In the context of the
components of resource-based analysis, Richard is trying to understand if his product or service is
________.
A) valuable
B) rare
C) durable
D) nonsubstitutable
76) Gareth is the owner of a popular car wash facility. He has a small cafe set up beside the facility
where customers can have a quick snack while waiting for their vehicles. Also, he ensures that
each and every customer gets the best service in town. Customers do not mind paying extra
because of these reasons. In fact, Gareth noticed that in the last 6 months, he has received several
new customers who were previously engaged with his competitors. In the context of the
components of resource-based analysis, Gareth’s product or service is ________.
A) rare
B) nonsubstitutable
C) durable
D) valuable
77) Jamie’s hamburger restaurant had financial gains from an asset or capability that are in excess
of the ordinary returns in that industry. This is called a(n) ________.
A) extraordinary asset
B) venture capability
C) good business decision
D) economic rent
78) All of these are criteria in deciding extraordinary resources in a company EXCEPT:
A) elastic.
B) rare.
C) valuable.
D) durable.