Chapter 3 Quiz
Which of the following statements is TRUE?
***A. Just because one firm receives a 3.20 overall rating and another receives a 2.80 in a CPM, it does not necessarily follow that the first firm is precisely 14.3% better than the second, but it does suggest that the first firm is better in some areas.*** B. Just because one firm receives a 3.20 overall rating and another receives a 2.80 in a CPM, it does not necessarily follow that the first firm is precisely 12.5% better than the second, but it does suggest that the first firm is better in some areas. C. When one firm receives a 3.20 overall rating and another receives a 2.80 in a CPM, it follows that the first firm is precisely 14.3% better than the second. D. Just because one firm receives a 3.20 overall rating and another receives a 2.80 in a CPM, it does not necessarily follow that the first firm is precisely 14.3% better than the second, but it does suggest that the first firm is much better in many areas. E. Just because one firm receives a 3.20 overall rating and another receives a 2.80 in a CPM, it follows that the first firm is precisely 12.5% better than the second, and that the first firm is better in some areas.
The weight column in an EFE Matrix must add up to what number?
1.0
The range of total weighted scores in a CPM Matrix is ______.
1.0 to 4.0
In an EFE Matrix, the average total weighted score is:
2.5
How many key external factors should be included in an EFE Matrix?
20
Regarding the AQCD criteria, strive to include all high quality factors in an external assessment for a firm. A high quality factor will meet ______ of the AQCD criteria; a low quality factor will meet ______ of the AQCD criteria.
3 or 4; 2 or fewer
COULD BE WRONG (17.) In an EFE Matrix, how much more important is a weight of 0.20 than a weight of 0.15?
33% .2/.15=1.33 .2 is 33% higher than .15
In an EFE Matrix, how much more important is a rating of 4 than a rating of 3?
33% 3/4=.75 4/4=1 1.0/.75=1.33 4 is 33% higher than 3
Which of the following statements is FALSE?
A. Avoid assigning the same rating to firms included in a CPM analysis. ***B. Regarding weights in a CPM or EFE Matrix, be mindful that 0.08 is mathematically 25 percent higher than 0.06, so even small differences can reveal important perceptions regarding the relative importance of various factors.*** C. Critical success factors in a CPM include both internal and external issues; therefore, the ratings refer to strengths and weaknesses, where 4 = major strength, 3 = minor strength, 2 = minor weakness, and 1 = major weakness. D. The ratings in a CPM refer to strengths and weaknesses, where 4 = major strength, 3 = minor strength, 2 = minor weakness, and 1 = major weakness. E. The weights and total weighted scores in both a CPM and an EFE have the same meaning.
External forces can be divided into five broad categories and ten subareas EXCEPT in which of the following?
A. Governmental B. Marketing C. Economic D. Demographic E. Technology
Which of the following statements is FALSE?
A. Regarding weights in a CPM or EFE Matrix, be mindful that 0.08 is mathematically 33 percent higher than 0.06, so even small differences can reveal important perceptions regarding the relative importance of various factors. ***B. You may assign the same rating to firms included in a CPM analysis if the firms are similar on the respective factor.*** C. The weights and total weighted scores in both a CPM and an EFE have the same meaning. D. The ratings in a CPM refer to strengths and weaknesses, where 4 = major strength, 3 = minor strength, 2 = minor weakness, and 1 = major weakness. E. Critical success factors in a CPM include both internal and external issues; therefore, the ratings refer to strengths and weaknesses, where 4 = major strength, 3 = minor strength, 2 = minor weakness, and 1 = major weakness.
Which of the following statements is TRUE?
A. Regardless of the number of key opportunities and threats included in an EFE Matrix, the highest possible total weighted score for an organization is 8.0 and the lowest possible total weighted score is 1.0. B. Regardless of the number of key opportunities and threats included in an EFE Matrix, the highest possible total weighted score for an organization is 10.0 and the lowest possible total weighted score is 0.0. C. Regardless of the number of key opportunities and threats included in an EFE Matrix, the highest possible total weighted score for an organization is 4.0 and the lowest possible total weighted score is 0.0. ***D. Regardless of the number of key opportunities and threats included in an EFE Matrix, the highest possible total weighted score for an organization is 4.0 and the lowest possible total weighted score is 1.0.*** E. Opportunities and threats can be external or internal.
Which of the following statements is TRUE?
A. Wild guesses oftentimes must be made in formulating strategies, but reasonable assumptions based on available information must always be made. B. Wild guesses should never be made in formulating strategies, but reasonable assumptions based on available information must always be made. C. Wild guesses should never be made in formulating strategies, but reasonable assumptions based on available information must oftentimes be made. D. Wild guesses should rarely be made in formulating strategies, but reasonable assumptions based on available information must usually be made. E. Wild guesses should sometimes be made in formulating strategies, and reasonable assumptions based on available information must sometimes be made.
In terms of growing globally by adding new customers, what company does the global Capsule 3 suggest may be the fastest growing company?
Amazon
An advantage of a strong dollar includes which of the following item(s)?
Companies importing goods have greater buying power because their dollars now go further overseas.
The bargaining power of consumers can be the most important force affecting competitive advantage. Consumers gain increasing bargaining power under the following circumstance:
If consumers are particularly important to the seller
The Industrial Organization view of strategic planning advocates that external (industry) factors are more important than internal ones for gaining and sustaining competitive advantage. Do the authors agree?
No. Matching key external opportunities and threats with key internal strengths and weaknesses provides the basis for successful strategy formulation.
According to Michael Porter, the nature of competitiveness in a given industry includes what force?
Potential development of substitute products and bargaining power of consumers
The AQCD test refers to the need for key external factors to exhibit what attributes?
Quantitative and divisional
According to Michael Porter, the nature of competitiveness in a given industry can be viewed as a composite of the forces. Which force is usually the most powerful?
Rivalry among competing firms
An example of an economic variable is "value of the dollar"long dash—which is currently highlong dash—compared with the Yen, Euro, and the Australian dollar. The high dollar results in what economic factor(s)?
The high dollar makes U.S. goods more expensive in overseas markets.
What source provides excellent online information and advice on approximately 1,700 stocks, more than 90 industries, the stock market, and the economy, including company income statements and balance sheets?
Value Line Investment Survey
In Step 1 of developing an EFE Matrix, how many opportunities and threats should be included in the full and narrow lists, respectively?
full 100 narrow 20
An excellent source of industry information, including industry profiles and trade statistics for many industries, is provided at what website?
http://globaledge.msu.edu/industries/
Are the interpretations of the weights in a CPM and EFE Matrix the same?
yes