Which of the following is a capability?
a) Patents and trademarks
b) Brand-name reputation
c) Installed base
d) Organizational culture
e) Sourcing skills
Which of the following statements best describes a characteristic of geographic
specialization focus strategies?
a) Offers a variety of products and/or sells to a variety of customer groups within a
narrow geography
b) Offers an array of product varieties to a limited class of customers
c) Caters to the particular needs of the customer group served
d) Offers a limited set of products to an array of different customer groups
e) Does an especially good job satisfying a subset of the needs of the consumer groups
being served
Why might a large firm actually be at an advantage over a smaller firm with respect to
labor?
a) Large generally pay a compensating differential to attract workers
b) Worker turnover is generally lower
c) Large firms enjoy better scale economies when negotiating with health insurance
companies for health benefits
d) Large firms are generally less attractive to qualified, upward mobile workers
e) Large firms often have to draw workers from a greater distance to fill their ranks
What situation occurs if an incumbent firm with increasing marginal costs or limited
capacity sets a price just below the entrants’ marginal costs even though the incumbent
may be unable to meet all market demand (or possibly may have to sacrifice its profits
to do so)?
a) Contestable limit pricing
b) Strategic limit pricing
c) Predatory pricing
d) Quality pricing
e) Capacity expansion
Which of the following terms best describes the ability of a firm to maintain and adapt
the capabilities that are the basis of its competitive advantage?
a) Riskiness of R&D
b) Correlated research strategies
c) Evolutionary economics
d) Dynamic efficiency
e) Dynamic capabilities
What is a key factor in determining how a firm resolves coordination problems?
a) Incentive based pay
b) Effective IT systems
c) Firm culture
d) Alignment of goals
e) Organizational structure
The Revenue Destruction Effect in oligopolies occurs when:
a) Firms individually reduce prices to gain more customers
b) Firms intentionally reduce output quantity to raise price
c) Firms independently maximize their own profits
d) Firms agree to all sell at the same price
e) Firms all agree to specific output quantities
Which term describes the situation where a smaller firm and potential entrant can use
the incumbent’s size to its own advantage?
a) Jujitsu economics
b) Karate economics
c) Boxing economics
d) Judo economics
e) David and Goliath economics
Which of the following is least likely a technique firms can use to mitigate the
free-rider problem?
a) Firms can reduce the repeated interactions among team members so that actions
depend less on what other members may have done in the past
b) Firms can keep teams small
c) Firms can allow employees to work together for long periods
d) Firms can structure teams so that their members can monitor one another’s actions
e) Firms can use future periods of interaction and let natural team dynamics of peer
pressure and social isolation take place as punishment for team members who have
failed to contribute in the past
What term describes a decision that has a long-term impact and is difficult to reverse?
a) Dedicated investment
b) Strategic commitment
c) Critical choice
d) Market investment
e) Firm commitment
The causal connection between firms is known as the:
a) Market structure formula
b) Structure, Conduct, Performance paradigm
c) Competition index
d) Herfindahl Iindex
e) Concentration, Profit connection