CH 1

The best example of a firm's external stakeholder is a(n) A) government agency that regulates the prices of products manufactured by the firm. B) board member from a wholly-owned foreign subsidiary of the firm. C) shareholder who has invested money in the firm but is not employed by the firm. D) employee of the firm who is responsible for a contract project.

A

In order to better achieve a competitive advantage, firms must now adopt a holistic approach towards satisfying multiple stakeholders opposed to focusing on the needs of their stockholders. This integrative approach is referred to as A) stakeholder strategy. B) internal shareholder strategy. C) integration strategy. D) exchange relationship strategy.

A

In the pyramid of corporate social responsibility, ________ responsibilities are the foundational building block. A) economic B) ethical C) philanthropic D) legal

A

Most consumers and investors today want the firms they do business with to look beyond just the profit motive. In fact, they want firms that behave legally and ethically while also giving back to their communities via philanthropic activities. The framework that attempts to reconcile these wants is known as A) corporate social responsibility. B) stakeholder impact analysis. C) business model analysis. D) value chain driven decision making.

A

The goal of a good strategy is focused primarily on A) creating superior value while containing costs. B) making as much money as possible. C) employing lean manufacturing and Six Sigma. D) encouraging investors to buy more shares of the firm.

A

Tommy wants to open his own food truck but doesn't know anything about business. He needs help determining who his competition is, how he should craft his strategy to compete and how he'll implement his strategy to achieve a competitive advantage. He's hired you to help him get started. As a result, you know that you will probably use the A) AFI strategy framework. B) business model analysis. C) Six Sigma tool. D) Stakeholder Impact analysis.

A

Which of the following stages of the strategic management process involves an evaluation of a firm's external and internal environments? A) strategy analysis B) strategy implementation C) strategy formulation D) strategy control

A

Which of the following tasks in the AFI strategy framework involves evaluating the internal and external environments in which a firm operates? A) analysis B) formulation C) implementation D) competitive advantage

A

A successful strategy details a set of goal-directed actions that managers make to gain and sustain a competitive advantage; in order to create this strategy, managers must focus on three pillars. Which of the following below is not one of these pillars? A) formulation B) execution C) implementation D) analysis

B

After a firm has identified its key stakeholders in stakeholder impact analysis, the immediate next step is to A) recognize the opportunities and threats the stakeholders present. B) identify stakeholders' interests and claims. C) formulate a stakeholder strategy. D) address the stakeholders' concerns.

B

Through ________, a firm puts its guiding policy into practice by employing a set of coherent actions. A) strategy control B) strategy implementation C) strategy formulation D) strategy analysis

B

Which of the following terms describes the guiding policy to address the competitive challenge, and uses corporate- and business-level strategy? A) analysis B) formulation C) implementation D) competitive advantage

B

Which of the following three important stakeholder attributes should managers pay special close attention to in order to better understand stakeholder impact analysis? A) competitive advantage, economic value, and time B) power, legitimacy, and urgency C) grace under pressure, financial control, and reward power D) shareholder rights plan, board representation and CEO influence

B

As the legal owners, ________ have the most legitimate claim on a company's profits. A) creditors B) employees C) shareholders D) board members

C

Bill's Auto & Airplane Repair shop is able to generate a positive net income of $10,000 a week; this is the industry average. We can conclude that since he has a positive net income, he also has a competitive parity in the industry. A) Correct—competitive advantage is achieved through profitability alone. B) Correct—competitive advantage is achieved since Bill's Auto & Airplane Repair shop has a positive net income. C) Correct—competitive parity is achieved by generating average returns, relative to competition in a given industry. D) Incorrect—Bill's Auto & Airplane Repair shop more than likely has a sustained competitive advantage since his business is diversified.

C

In ________, a firm frames a guiding policy to address the competitive challenge. A) strategy control B) strategy implementation C) strategy formulation D) strategy analysis

C

John is a bit confused about the difference between stakeholders and stockholders. You meet with John and inform him that the main difference is that A) stakeholders are both internal and external to the firm while stockholders are considered external to the firm. B) stakeholders are considered internal to the firm while stockholders are external to the firm. C) stakeholders can be both internal and external while stockholders own shares of a firm and are classified as internal to the firm. D) stakeholders are external to the firm while stockholders are considered internal to the firm.

C

Tony's Pizza Shop is able to net $10,000 a week; this makes his shop profitable. His number one competitor, Leo's Pies is also profitable, netting $12,000 a week. Lil Anthony's Pizza Palace nets $13,000 a week. Since Tony's Pizza Shop is profitable, we can conclude that he has a competitive advantage in the industry. A) True—competitive advantage is achieved through profitability alone. B) True—competitive advantage is achieved since Tony has a positive net income. C) False—competitive advantage is only achieved by generating above average returns, relative to competition. D) False—Tony more than likely has a sustained competitive advantage since he's been in business longer.

C

When the strong dictatorial rule in Arlington unexpectedly collapsed due to the shocking death of the royal family in an explosion, the nation's economy experienced drastic changes. The laws became more restrictive, the country lost many locally produced resources and products, and the distribution of wealth became inequitable. The unexpected event that led to these changes can best be described as a(n) ________ event. A) extinction B) wild card C) black swan D) miracle

C

Which of the following best qualifies as a firm's internal stakeholder? A) an auditor assigned to the firm by a federal government agency B) a labor union with whom the firm's employees can affiliate C) a manager taking care of the firm's operations in a foreign market D) a competitor manufacturing the same products as that of the firm

C

________ is best described as an integrative management field that combines analysis, formulation, and implementation in the quest for competitive advantage. A) Supply chain management B) Integrated technology management C) Strategic management D) Inventory management

C

All of the following are external stakeholders except which of the following? A) customers B) creditors C) alliance partners D) competitors

D

Due to several black swan events in the past, the A) shareholders of public companies have become more confident in investing their resources in businesses. B) need for corporate governance and transparency has decreased within various industries. C) nations around the globe have explicitly appreciated and accepted capitalism as an economic system. D) implicit trust relationship between the corporate world and society at large has deteriorated.

D

Green and Good Inc., a multinational company, relies on its media partner OmniSignal to regularly advertise its offers, sales, and new products. OmniSignal is invested in this relationship because it generates most of its revenue from advertising Green and Good's products. In this scenario, OmniSignal is Green and Good Inc.'s A) stockholder. B) workforce. C) internal stakeholder. D) external stakeholder.

D

In strategic management, strategists engage in three pillars. Which of the following is not one of these three pillars? A) the implementation of major goals and objectives B) the analysis of major goals and objectives C) the formulation of major goals and objectives D) the unification of major goals and objectives

D

Jill is interested in the concept of strategy and decides to create her own. As a result, Jill says that her strategy is to focus on growth and marketing to achieve competitive advantage. How would you evaluate Jill's statement? A) Jill's strategy makes sense and she should move forward with it. B) Jill's strategy reveals a clear strategic position and tradeoff, so she should proceed. C) Jill should reevaluate her statement because it fails to mention human resources and finance. D) Jill should reevaluate her statement because it fails to meet the principles of what a strategy should be.

D

The AFI framework (analysis, formulation, implementation) affects a firm at nearly every level. Which of the following would be classified as the top level of strategy within a firm? A) the functional level B) the business level C) the operational level D) the corporate level

D