Research finds that centralization of authority is never advantageous, not even in time
of crisis.
Strategic group analysis allows managers to focus only on what is happening in their
group.
Control through culture is so powerful because once values have been internalized,
individuals follow them without thinking about them.
Effective strategy implementation is very important for cost leaders, but it is of less
importance to differentiators.
One of the defining characteristics of the mature stage of the industry life cycle is that
growth is low or zero.
More people seem to fear a snake bite than a dog bite, and yet statistically one is more
likely to be bitten by a dog than by a snake. This represents which of the following
cognitive biases?
A.Escalating commitment
B.Hypothesis bias
C.Availability error
D.Representativeness
E.Illusion of control
Devil’s advocacy
A.is simpler than the expert approach.
B.is an example of ivory tower planning.
C.results in unproductive conflict.
D.involves one group member being responsible for questioning the assumptions of a
plan.
E.results in a final plan that is a combination of a plan and a counterplan.
The term used to describe how people learn an organization’s culture and way of
behaving in the organization is
A.organizational structure.
B.organizational development.
C.organizational design.
D.organizational behavior.
E.organizational socialization.
A typical board of directors is composed of
A.inside directors.
B.external directors.
C.inside directors and consumer advocates.
D.outside directors and union representatives.
E.inside and outside directors.
Economies of scope typically involve
A.sharing resources by business units.
B.acquiring resources from outside a company.
C.limited utilization of resources by specific business units.
D.all of these choices.
E.none of these choices.
Why should satisfying stockholder demands receive so much attention in many
corporate mission statements?
A.Stockholders are the most powerful stakeholder group that a company has to satisfy.
B.Stockholders are the legal owners of the company and are the providers of risk
capital.
C.Stockholders have been successful in blackmailing companies to get their interest
satisfied before those of other claimants.
D.Typically, stockholders have the most invested in the company’s continued survival.
E.Managers feel obliged to pay lip service to stockholder demands.
The concept of quality applies to
A.all products.
B.the products consumers believe to be high-quality products.
C.products with a high per-unit cost.
D.custom-made products only.
E.only those products that have been redesigned.
Which of the following stakeholders might not want a company to maximize its
long-run profitability and profit growth?
A.Suppliers
B.Creditors
C.Customers
D.Suppliers and customers
E.Suppliers and creditors
The U.S. firm Hewlett-Packard (HP) built twelve worldwide manufacturing facilities in
several different countries, but its research and development (R&D) and marketing are
centralized in the United States. Based on this information, which entry mode is HP
using in its various locations?
A.Acquisition
B.Internal new venture
C.Joint venture
D.Divestiture
E.Merger
Profit growth is best measured
A.by the increase in share price.
B.by the return on investment.
C.by the increase in net sales.
D.over time.
E.by increases in liquidity.
The threat from new entrants is greatest in the ____ stage of the industry life cycle.
A.embryonic
B.growth
C.shakeout
D.maturity
E.decline
In its U.S. operations, Japanese-based Sony has decentralized almost all of its tasks to
an independent firm that it created and which it owns. Based on this information, which
entry mode is Sony using in the United States?
A.Internal new venture
B.Acquisition
C.Joint venture
D.Divestiture
E.Merger
For its South American operations, Caterpillar performs most functions at its U.S.
headquarters but markets through cooperative relationships with local distributors.
Based on this information, which entry mode is Caterpillar using in South America?
A.Internal new venture
B.Joint venture
C.Merger
D.Acquisition
E.Intrapreneurship
Which of the following is not a determinant of the extent of rivalry among established
companies?
A.Industry competitive structure
B.Demand conditions
C.The cost structure of firms in an industry
D.Exit barriers
E.The power of buyers
Which of the following statements concerning stock-based compensation schemes for
executives is incorrect?
A.They are the most objective and unambiguous way to compensate executives.
B.They can align the interests of management and stockholders.
C.They can dilute the equity of stockholders.
D.The option strike price is typically the price that the stock was trading at when the
option was granted.
E.None of these choices are correct.
Consumers will bear the costs of switching technologies when
A.the benefits of adopting the new technology outweigh the costs of switching.
B.switching costs are substantial.
C.switching costs are reimbursed by makers of a product.
D.all of these choices.
E.none of these choices.