management chapter 4

The balance of power between a firm and its customers affects its ability to compete effectively and earn above-average returns. True False

True

The ________ of a product or service is a function of how many customers are willing to purchase the product or service and how much they are willing to pay for it. market value relative value absolute value intrinsic value

absolute value

Products of a company would ________ when no other firms can have the capabilities needed to provide the same quality and quantity of products and services. have no market value be a rarity be difficult to imitate be substituted easily

be a rarity

The ________ strategy determines how a firm will compete in each of these markets. functional corporate-level unit-level business-level

business-level

Aliva, a bottled water company, places a premium on the marketing and sales of its products by offering purified water from the natural streams of the Himalayas. This way, compared to other companies, it provides superior value. This is an example of ________. open source advantage absolute advantage first-mover advantage comparative advantage

comparative advantage

Nobelle, a chocolatier based in France, produces candy containing exotic ingredients from the rain forests of Brazil. The ingredients are provided by a single supplier who has an exclusive contract with Nobelle. The chocolate manufacturer thus has a great deal of power over the market. This is an example of ________. strategic management distinctive competence competitive advantage strategic vision

competitive advantage

Federal spending pushes the federal deficit up, causing an increase in interest rates. What is the LEAST likely result of this occurrence? unemployment increases it becomes more expensive to borrow money businesses expand at a slower rate consumer spending increases

consumer spending increases

In the process of strategic management, the ________ strategy determines what business or businesses the firm wishes to operate. functional business-level corporate-level unit-level

corporate-level

Which of the following typically helps achieve cost leadership? investing in research and development employing economies of scale offering superior products and services targeting a niche segment

employing economies of scale

Service activities are designed to ________. inform potential customers about the products and services the firm has available ensure that the product satisfies the customer after the purchase move the product or service from the firm to the customers transform inputs into the products and services of the firm

ensure that the product satisfies the customer after the purchase

Campacola is a soda company that is seeking to enter the market by introducing an unusual line of sodas that contain granules that pop in the mouth. It intends to sell these sodas at no greater cost than normal sodas. What strategy is the company using in entering the soda market? cost leadership strategy multipoint differentiation strategy focused differentiation strategy integrated differentiation-cost leadership strategy

integrated differentiation-cost leadership strategy

Which of the following would lead to lower profits for an industry? low entry barriers many suppliers few substitutes quality-based competition

low entry barriers

In the cut-flower industry, fresh flowers must be available to customers as soon as possible after they have been harvested. On which of the following activities in the value chain does this places a premium? service procurement operations outbound logistics

outbound logistics

In Albany, Georgia, the bars and restaurants built outdoor seating areas after the city passed laws banning indoor smoking to accommodate customers who smoked. To what dimension of the general environment were the bar and restaurant owners reacting? political-legal forces economic forces institutional forces sociocultural forces

political-legal forces

Which of following is a requirement for a product to have competitive advantage over others? durability responsiveness rarity assurance

rarity

In the value chain, ________ facilitate the creation of the product or service and its transfer to the customer. primary activities tertiary activities support activities procurement activities

support activities

Corporate-level strategy is the most important for achieving a competitive advantage. True False

False

Process technological changes are those that lead to completely new products as well as new features and capabilities for existing products. True False

False

The general environment's effects on a business are very direct. True False

False

________ involve a country's infrastructure, such as roads, telecommunications, air links, arable land, deep water harbors, mineral resources, forests, and climate. Physical forces Institutional forces Sociocultural forces Geopolitical forces

Physical forces