Chapter 7

A type of generic strategy aimed at clarifying how one product is unlike another in a mass market refers to _____ strategy. A. differentiation B. cost C. integration D. focus

A

A type of life cycle stage following a boom in which there is a rapid decrease in the number of firms in an industry is the A. shake-out. B. growth stage. C. maturity stage. D. decline stage.

A

A(n) _____ is the business term for the population of customers for your products or services. A. market B. industry C. strategy D. SIC

A

Changes in competitors, sales and profits in an industry over time is called A. industry dynamics. B. retrenchment. C. a shake-out. D. a transformational competency.

A

Cost benefits can come from all of the following EXCEPT A. credit. B. scale savings. C. learning. D. organizational practices.

A

Following the health trend, Amy Amorouso and her two friends have decided to open a laundromat with a workout facility. The concept of each of these exists separately and also there are laundromats with bars or game rooms that already exist. This would be a different variation. The main focus will be the laundromat with a small space allowed for a workout area, with a few machines to test the idea. The first thing that Amy and her friends need to do to pursue their strategy is to perform A. an industry analysis. B. a SWOT analysis. C. a VRIO analysis. D. a value chain analysis.

A

The amount of money left after operating expenses are deducted for the business refers to A. net profit. B. gross profit. C. operating profit. D. earnings before tax.

A

The second step of the small business strategy planning process is considering with _____ A. customers; benefits. B. competitive advantage; value chain analysis. C. prestrategy; VRIO analysis. D. benefits; industry analysis.

A

Which are the two major classification systems that code industries? A. NAICS and SIC B. SCALE and SCOPE C. SWOT and VRIO D. SIC and SWOT

A

Which of the following represent the five stages of industry life cycle? A. Introduction, growth, maturity, decline, and death. B. Introduction, pioneers, early adopters, decline, and death. C. Pioneers, growth, early adopters, decline, and death. D. Pioneers, early adaptors, late adopters, early majority, and death.

A

_____ is the idea and actions that explain how a firm will make its profits. A. Strategy B. Objective C. Mission D. Goal

A

In SWOT, strengths are A. chances to make greater sales or profits in the environment. B. characteristics of the business that give it an advantage over others in the industry. C. elements in the environment that could cause trouble for the business. D. characteristics that place the firm at a disadvantage relative to others.

B

Most small businesses are more _____ than _____. A. cost-directed; profit-directed B. imitative; innovative C. customer-driven; employee-driven D. innovative; imitative

B

The first step of the small business strategy planning process A. involves performing a SWOT. B. involves reviewing and confirming the prestrategy decisions that define your firm and your goal for it. C. is where you consider your customers and the benefits you want to offer them. D. is to study the dynamics and trends of your industry.

B

Using the degree of similarity, Amy's concept of laundromat with a workout space can be described as A. parallel competition. B. incremental innovation. C. cloning. D. mass differentiation.

B

Which of the following refers to funds left over after deducting the cost of goods sold? A. Profit before taxes B. Gross profit C. Net profit D. Rate of profit

B

Which of the following refers to the particular way a firm implements customer benefits that keeps the firm ahead of other firms in the market? A. Industry analysis B. Competitive advantage C. Resource distribution D. Value chain

B

An opportunity that makes it possible for a new business to gain a foothold in a market refers to A. parallel competition. B. incremental innovation. C. entry wedge. D. altruism.

C

The fourth step of the small business strategy planning process A. is where you consider your customers and the benefits you want to offer them. B. aims to refine your firm's capabilities in order to maintain a competitive advantage. C. involves determining the best strategic direction and strategy for the firm. D. is to study the dynamics and trends of your industry.

C

What types of customers are likely to generate more potential customers than any other type? A. Loyal customers B. Local customers C. Passionate customers D. Corporate customers

C

When performing a SWOT analysis, where Amy's business threats meet her business weaknesses, what should her strategy option be? A. Fix B. Fight C. Flee D. Flaunt

C

_____ refers to the size of the market whereas _____ refers to its geographic range. A. Scope; scale B. Mass; niche C. Scale; scope D. Niche; mass

C

A research process that provides the entrepreneur with key information about the industry, such as its current situation and trends is called A. SWOT analysis. B. VRIO analysis. C. value chain analysis. D. industry analysis.

D

An overall strategic approach in which a firm seeks to do something that is very different from that of what others in the industry are doing is called a(n) A. cost-leadership strategy. B. imitative strategy. C. grand strategy. D. innovative strategy.

D

Identify the two market decisions that Amy and her friends need to make. A. Imitation and innovation B. Local or global C. Mass or niche D. Scale and scope

D

The tool appropriate for the third step of the small business strategy process to study the dynamics and trends of your industry is the A. value chain analysis. B. SWOT analysis. C. VRIO analysis. D. industry analysis.

D

Value benefits can include all of the following EXCEPT A. quality. B. style. C. delivery. D. learning.

D