The internal environment includes the variables that are within the short-run control of
top management.
Answer:
One way to adjust for inflation for global operations outside the United States is to use
the U.S. Consumer Price Index (CPI).
Answer:
When employees across the organization hold the same cultural values and norms, this
demonstrates a high level of cultural integration.
Answer:
The index of sustainable growth indicates how much of the growth rate of sales can be
sustained by internally generated funds.
Answer:
A strategic decision is rare, consequential, and directive.
Answer:
SO strategies attempt to take advantage of opportunities by overcoming weaknesses.
Answer:
Benchmarking has been decreasing in popularity as companies emphasize uniqueness.
Answer:
In case analysis, how the company actually dealt with the case problem is the most
important part of the solution.
Answer:
Logical incrementalism is a useful decision-making mode when the environment is
rapidly changing and when it is important to build consensus.
Answer:
Management contracts are common when a host government expropriates part or all of
a foreign-owned company’s holdings in its country.
Answer:
According to Hofstede’s dimensions of national culture, long-term orientation is the
extent to which society is oriented toward the long versus the short term.
Answer:
Corporate strategy occurs at the business unit or product level.
Answer:
IHOP’s CEO, Julia Stewart, built a reputation as a turnaround specialist.
Answer:
Based on the eight dimensions of quality discussed in the text, serviceability is defined
as the product’s ease of repair.
Answer:
The lowest degree of involvement for a board of directors is the catalyst level of
interaction.
Answer:
The purpose of a program or tactic is to make the strategy action-oriented.
Answer:
Rollups are not synonymous with traditional mergers and acquisitions.
Answer:
Key liquidity ratios include the current ratio, quick ratio, and cash ratio.
Answer:
Successful late movers tend to be large firms with considerable resources and related
experience.
Answer:
One of the obstacles to effective control is the difficulty in developing appropriate
measures of important activities and outputs.
Answer:
Performance results are monitored at the strategy formulation phase of the strategic
management process.
Answer:
New product development would be a core competency if it goes beyond one division.
Answer:
BP and Royal Dutch Shell are examples of fully integrated firms because they
internally make 100% of their key supplies and completely control their distributors.
Answer:
The debt to asset ratio measures the extent to which borrowed funds have been used to
finance the company’s assets.
Answer:
One of the benefits of strategic management is a clearer sense of strategic vision for the
firm.
Answer:
A minority percentage of large corporations in the Americas and Europe may keep the
firm’s recently retired CEO on the board after retirement since there is a greater
likelihood of a conflict of interest and less objectivity.
Answer:
Environmental scanning is the monitoring, evaluating, and disseminating of information
from the external environment to key people within the corporation.
Answer:
EVA may eventually replace ROI as the standard performance measure.
Answer:
A relatively quick way to move into an international area is through greenfield
development.
Answer:
Stickiness and eyeballs are two non-financial performance measures used by Internet
business ventures.
Answer:
Which of the following is NOT a goal of financial strategies?
A) Examine the financial implication of corporate and business level strategic options
and identify the best financial course of action.
B) Provide the corporation with the appropriate financial structure and funds to achieve
its overall objectives.
C) Institute a new product development plan to generate profit gain market share.
D) Provide competitive advantage through a lower cost of funds and a flexible ability to
raise capital to support a business strategy.
E) Attempt to maximize the financial value of the firm.
Answer:
Which type of structure enables a corporation to centralize decision making along
product lines and to reduce costs?
A) geographic-area structure
B) product-group structure
C) network structure
D) matrix structure
E) functional structure
Answer:
The “cell” chip created by IBM, Sony Electronics, and Toshiba was a result of pooling
their resources in a
A) joint venture.
B) licensing arrangement.
C) value-chain partnership.
D) mutual service consortium.
E) competitive advantage.
Answer:
The controversy surrounding external versus internal growth finds
A) external growth appears to be superior financially to internal growth.
B) internal growth appears to be superior financially to external growth.
C) there appears to be no financial advantage to either.
D) acquisitions have a lower survival rate than new internally generated business
ventures.
E) strategic alliances are superior to both.
Answer:
All of the following are technological breakthroughs already having a significant
impact on many industries EXCEPT
A) growing health consciousness.
B) alternative energy sources.
C) genetically altered organisms.
D) smart, mobile robots.
E) virtual personal assistants.
Answer:
According to Schilit, the search for hidden weaknesses in a company’s performance is
known as
A) a strategic audit.
B) a SWOT analysis.
C) forensic accounting.
D) activity based accounting.
E) competitive analysis.
Answer:
Regression analysis is an example of which quantitative forecasting technique?
A) the delphi technique
B) statistical modeling
C) brainstorming
D) trend-impact analysis
E) morphological analysis
Answer:
Downsizing is often used to implement a(n) ________ strategy.
A) retrenchment
B) growth
C) stability
D) hold
E) integration
Answer:
According to Porter, the collective strength of the interaction of potential entrants,
buyers, substitutes, suppliers, firm rivalry, and other stakeholders determine
A) the level of government action in an industry.
B) the probable industry attractiveness and business strength position.
C) the ultimate profit potential in the industry measured in terms of long-run return on
invested capital.
D) the aggregate level of demand for a product line.
E) the amount of pressure from the societal environment.
Answer:
Which of the following regions is the most globalized region of the world in terms of
boards of directors with most companies having one or more non-national directors?
A) Asia
B) Middle East
C) North American
D) Pacific Rim
E) Europe
Answer:
Being socially responsible
A) provides a company with a more positive overall reputation.
B) has opened doors in local communities.
C) has enhanced the company’s reputation with consumers.
D) may have a positive effect on the firm’s financial performance.
E) all of the above
Answer:
In the EFAS Table, the indicator of how well a particular company is responding to
current and expected factors in its external environment is characterized by the
A) IFAS score.
B) industry matrix.
C) total weighted score.
D) SWOT score.
E) SFAS score.
Answer:
According to the BCG Growth Share Matrix, market leaders that typically are at the
peak of their product life cycle and are usually able to generate enough cash to maintain
their high share of the market are called
A) cash cows.
B) lost leaders.
C) dogs.
D) question marks.
E) stars.
Answer:
The PRIMARY task of the manager of information systems is to
A) prevent unlawful usage of the information from the system.
B) make sure the information contained in the system is up-to-date and accurate.
C) monitor the input of information into the information system.
D) design and manage the flow of information in a corporation to improve productivity
and decision making.
E) ensure that only those who have authorized permission have access to the
information system.
Answer:
The job characteristics model is a good example of
A) job rotation.
B) job design.
C) job enrichment.
D) job enlargement.
E) all of the above
Answer:
Which of the following is NOT a trend in corporate governance expected to continue?
A) Institutional investors are becoming active on boards.
B) Boards are getting more involved in shaping company strategy.
C) Boards are getting larger.
D) Shareholders are demanding that directors and top managers own more than token
amounts of stock in the corporation.
E) Outside directors are taking charge of annual CEO evaluations.
Answer:
Blindly following orders reflects which type of moral relativism?
A) naive relativism
B) role relativism
C) principled relativism
D) cultural relativism
E) social group relativism
Answer:
A careless director or directors can be held personally liable for harm done to the
corporation if they failed to act with
A) codetermination.
B) figurehead role.
C) cumulative voting.
D) accountability.
E) due care.
Answer:
All of the following are true of overconfident CEOs EXCEPT
A) overconfident CEOs tend to charge ahead with mergers and acquisitions even
though they are aware that most acquisitions destroy shareholder value.
B) overconfident CEOs view their company as undervalued by outside investors.
C) overconfident CEOs are more likely to do deals that diversify their firm’s lines of
businesses.
D) the overconfidence of CEOs may lead to hubris.
E) overconfident CEOs were less likely to make an acquisition when they could avoid
selling new stock to finance them.
Answer:
Which of the following statements is true concerning a corporate reputation?
A) It is a widely held perception of a company by the general public.
B) A good corporate reputation can be a strategic resource.
C) There is a positive relationship between corporate reputation and financial
performance.
D) Reputation tends to be long-lasting and hard for others to duplicate.
E) all of the above
Answer:
According to the text, 75% of a company’s market value is derived from its
A) employees.
B) intangible assets.
C) plant assets.
D) joint ventures.
E) licensing agreements.
Answer:
A responsibility center which measures resources in dollars without consideration of
service or product costs is called a(n)
A) investment center.
B) revenue center.
C) expense center.
D) profit center.
E) standard cost center.
Answer:
Which of the following is NOT a guideline for proper control?
A) Control should involve only a minimum amount of information.
B) Long-term as well as short-term controls should be used.
C) Controls should be timely so that corrective actions can be taken before it is too late.
D) Controls should measure all activities in order to be comprehensive.
E) Controls should emphasize the reward of meeting or exceeding standards rather than
punishment for failing to meet standards.
Answer:
When P&G (the maker of Folgers and Millstone coffee) worked with Mr. Coffee,
Krups, and Hamilton Beach to market Home Caf, they engaged in a
A) joint venture.
B) licensing arrangement.
C) value-chain partnership.
D) mutual service consortium.
E) competitive advantage.
Answer:
The ________ boards typically never initiate or determine strategy unless a crisis
occurs.
A) rubber stamp
B) active participation
C) catalyst
D) nominal participation
E) minimal review
Answer:
Treating people in the same way who are similar on relevant dimensions such as job
seniority, is an example of
A) compensatory justice.
B) retributive justice.
C) relevant justice.
D) distributive justice.
E) punitive justice.
Answer:
Which of the following is NOT one of the risks of the focus strategy?
A) The target segment’s structure erodes.
B) The segment’s differences from other segments narrow.
C) The advantages of a broad line increase.
D) Focusers exit the industry.
E) Demand disappears for the product in the target segment.
Answer:
Which financial indicator is calculated as the ratio of annual credit sales to accounts
receivable?
A) days of cash
B) average collection period
C) accounts receivable turnover
D) inventory turnover
E) net working capital turnover
Answer:
The evaluation of alternative strategies and selection of the best alternative is referred to
as
A) alternative generation.
B) strategic implementation.
C) strategic choice.
D) strategic selection.
E) evaluation.
Answer:
If a company wishes to be a technological follower and also pursue a differentiation
strategy, the appropriate R&D strategy would be to
A) adapt the product or delivery system more closely to buyer needs by learning from
the leader’s experience.
B) value activities by learning from the leader’s experience.
C) avoid R&D costs through imitation.
D) create low-cost ways of performing value activities.
E) innovate in other activities to increase buyer value.
Answer:
Which financial indicator is calculated by the ratio of annual dividends per share to
current market price per share?
A) return on equity
B) dividend payout ratio
C) dividend yield on common stock
D) price/earnings ratio
E) debt to equity ratio
Answer:
Managers who want to improve ethical behavior should take actions such as
A) communicate the code of ethics in training programs.
B) emphasize the code of ethics in performance appraisal systems.
C) follow a code of ethical behavior themselves.
D) communicate the code of ethics in policies and procedures.
E) all of the above
Answer:
Which of the following statements is true concerning secondary stakeholders?
A) Secondary stakeholders are those who have only an indirect stake in the corporation,
but who are affected by corporate activities.
B) Secondary stakeholders may include non-governmental organizations (like
Greenpeace) and trade associations.
C) Because the corporation’s relationship with each of these stakeholders is usually not
covered by any written or verbal agreement, there is room for misunderstanding.
D) Aside from competitors, secondary stakeholders are not usually monitored by the
corporation in any systematic fashion.
E) all of the above
Answer:
Of the six values measured by the Allpot-Vernon-Lindzey Study of Values test, both
U.S. and British executives consistently score highest on ________ values and lowest
on ________ values.
A) religious and theoretical; economic and social
B) religious and economic; political and social
C) economic and political; social and religious
D) social and religious; aesthetic and political
E) religious; economic
Answer:
What is the Z-value?
Answer:
What is TQM and what are its essential ingredients?
Answer:
List the guidelines proposed for successful downsizing.
Answer:
What are cooperative strategies?
Answer:
Distinguish between behavior and output controls. Provide examples of each.
Answer:
Contrast agency theory and stewardship theory.
Answer:
What is a corporate scenario? What are the three steps in their construction?
Answer:
What is R&D intensity?
Answer:
Discuss the two basic growth strategies.
Answer:
What is the most commonly used measure of corporate performance (in terms of
profits)? Discuss the limitations of using this measure.
Answer:
Briefly describe the four basic elements of strategic management.
Answer:
Describe Barney’s VRIO framework.
Answer:
What are constant dollars and why are they important?
Answer:
What is corporate culture and what are the two distinct attributes of culture?
Answer:
Discuss the three basic approaches to ethical behavior.
Answer:
Define competitive intelligence.
Answer:
Explain the difference between Milton Friedman’s and Archie Carroll’s approaches to
the responsibilities of business.
Answer:
What is a strategic decision and what are its three characteristics?
Answer:
What are the three key issues that corporate strategy deals with?
Answer: