BADM Ch5

In order to ensure that a firm is implementing the triple-bottom-line approach successfully, managers must________________ -fill out a balance scorecard -audit the company's result in fulfilling its social and ecological

-audit the company's result in fulfilling its social and ecological

Variable costs of a computer manufacturer? -display screens -manuf facilities -hard drives -the administration assistant

-hard drives -display screens

Which are the standard performance dimensions for a company? -how much economic value a firm generates -how much shareholder value a firm creates -a firm's accounting profitability -the fixed and variable costs

-how much economic value a firm generates -how much shareholder value a firm creates -a firm's accounting profitability

Since about the year 2000, assets not captured in firm's accounting data have become _______ to a firm's competitive advantage. -much less important -much more important -unimportant

-much more important

Which are off-balance sheet items? -pension obligations -owned assets -operating leases -cash

-pension obligations -operating leases

In order to determine market capitalization, one multiplies which of the following together? -share price -number of outstanding shares -value of the dollar -total market value

-share price -number of outstanding shares

To find a product's producer surplus, which of the following need to be compared? (2 of them) -the price charged -the number of products sold -the cost of production -the overhead costs

-the price charged -the cost of production

In annual filing with the Securities and Exchange Commission, public companies in the United States must report which of the following? -expected share prices in the next fiscal year -the total return to shareholders -benchmarks

-the total return to shareholders -benchmarks

The most a consumer is willing to pay for a product is equivalent to the product's _____________________ -economic value created -total perceived consumer benefits

-total perceived consumer benefits

A corporation has a market capitalization of $100,000,000 and each share is worth $100. How many outstanding shares of the corporation are there?

100,000,000/ 100 = 1,000,000

A company's total return to shareholders consists of which of the following? A. Stock Price appreciation B. Dividends received C. Interest payments D. Wages

A and B

Standard dimensions for measuring competitive advantage? A. accounting profitability B. economice value C. shareholder value D. Consumer surplus

A,B,C

Which are true about Apple and Microsoft? -M leveraged its computer operating system to sell other software programs -Apple introduced a series of popular consumer electronic devices -apple became the most valuable company in the world

ALL

To determine a product's producer surplus, which of the following must be compared?

Cost to Product(C) - The price to be charged (P)

Questions for understanding balanced scorecard?

How do customers view us? What core competencies do we need? How do shareholders view us? How do we create value?

A strategic objective at 3M that is implemented is that 30% of revenues must be obtained from new product introduction. This objective would arise as an answer to which Balanced Scored questions? -What core competencies do we need? -How do we create value? -How do customers view us? -How do shareholders view us?

How do we create value?

What is another name for producer surplus?

Profit

What does ROIC stand for?

Return on invested capital

Money spent by a shareholder for an equity share in a company is ______capital

Risk Capital

A business strategy that can be pursued over time without harmful effects on people or the environment?

Sustainable strategy

Investors in a company are mostly concerned about the company's _____________. -return on invested assets -total return to shareholders

Total return to shareholders

Freemium business model is a variation of the razor-blade model? T or F

True

Is wholesaling considered a traditional model for retail? T or F

True

The freemium business model can be considered an evolutionary variation on the razor-razor blade model. T or F

True

BHAG stands for:

big hairy audacious goal

The ______________________ describes how they tun strategy into action.

business model

Netflix started producing and distributing original content (House of Cards). This is an example of the potential value of_______________. -consumer cost sharing -business model innovation

business model innovation

When a firm goes bankrupt, shareholders_________.

cannot recover their risk capital

Economic value creation is: the sum of ___________________ surplus and _____________surplus

consumer and producer

The firm's actual __________ of assets minus depreciation is called the book value.

costs

When a firm has more ________ value than competing firms, it has competitive advantage.

economic value

To measure firm-level competitive advantage, a company must_________.

estimate the economic value created for all products and services offered by the firm

Balanced scorecard approach helps managers balance ____________ goals. -advantaged and disadvantaged -financial and strategic -fixed and variable

financial and strategic

The balanced scorecard approach helps managers balance__________ goals.

financial and strategic goals

Money firm spends to set up sales website is ________ cost?

fixed

Balanced scorecard is a tool for strategy A. survival B. formulation C. metrics D. implementation

implementation

When the high market valuation of internet-based firms, such as FB or Google, is analyzed, the importance of ______ becomes clear.

intangibles

When a firm does favorably compared to similar firms, it is said to ____________.

outperform

In order to be considered a legal owner of a public company, a person or organization must________.

own at least one share of the company's stock

When you join the vehicle-sharing company ZoooooMM, you are allowed to use a motorized scooter whenever you like, though you do not have to own the machine. You have to pay by the hour of usage. Zoooooomm operates on a ______________model. -Triple bottom line -subscription-based -pay as you go -razor blade model

pay as you go model

Managers implement the blueprint of their business model through which of the following?

processes, structures, culture

What does SGA stand for? sales, general,

sales, general, administrative

Triple bottom line dimensions are:

social, ecological, economic

Economic value created is the ___________ the cost to produce a product/service and the amount the buyer is willing to pay for it.

the difference between

Economic value creation is calculated as:

the sum of consumer and producer surplus

To find the consumer surplus?

willing to pay (V) - what is paid (P)

According to _____________ theory, a firm exists within an interconnected network of constituencies, both within and outside the organization, the firm is responsible these constituencies. -shareholder value creation -stakeholder theory -the balanced-scorecard

-stakeholder theory

What are disadvantages of the shareholder value creation approach? -stock prices can be highly volatile -overall macroeconomic factors have a direct bearing on stock prices -the approach takes into account the past and present as well as future exceptions -stock prices are influenced by the psychological mood of investors

-stock prices can be highly volatile -overall macroeconomic factors have a direct bearing on stock prices -stock prices are influenced by the psychological mood of investors

The business model used by telecommunication companies when they provide a basic cell phone at no charge when the customer signs a two-year contract is a combination of which of the following types of business models? -freemium -subscription -razor razor blade

-subscription -razor razor blade