J402 Quiz #2

Which of the following statements regarding the price sensitivity of buyers is NOT true? A. The price of a product is the only determining factor of whether or not a buyer is price sensitive B. Price sensitivity among buyers in an industry raises competitive pressures for competing firms in the industry C. Price is a more critical factor in the purchase decisions of low-income consumers D. When buyers are price sensitive, sellers are limited in their ability to charge high prices E. Buyers are more sensitive to the price of a product or service when the purchase represents a significant percent of their budget

A

Key Success Factors for an industry are factors essential for a company to survive and thrive in a given industry. Which of the following are NOT considered types of key success factors? A. operational approaches B. strategic sourcing C. competitive capabilities D. elements of strategy E. product and service attributes

B

The balance between industry supply and buyer demand in an industry, as well as, the growth in buyer demand, have an impact on three of the five forces. Select the answer below that indicates which three. (This answer can be found from reading the list of pressures for each force in figures 3.4, 3.5, 3.6, 3.7 and 3.8.) A. Substitutes, Buyer Power, and Switching Costs B. Competitor Rivalry, Buyer Power, and Supplier Power C. Buyer Power, Threat of Entry, and Competitor Rivalry D. Threat of Entry, Substitutes, and Competitor Rivalry E. Competitor Rivalry, Substitutes, and Buyer Power

B

Which of the following is NOT considered a cost or factor that could impact the threat of entry? A. Economies of scale B. Office supplies C. Patents D. Working capital E. Regulation

B

Which of the following best describes substitute products? A. Products that are priced exactly the same as the industry products B. Products that are better quality C. Products in different industries that address the same basic customer needs D. The same basic products produced by two companies within the same industry E. Alternative products sold by one company

C

Which of the following is NOT a component of strategy one should identify in order to assess the strategy of a company, including how well the strategy is working. A. Sustainable competitive advantage B. Superior company performance and shareholder value vs. competitors C. Company vision, mission and core values D. Superior customer value E. Attractive customers, markets, and segments

C

Which of the following is NOT an appropriate conclusion one can draw from an assessment of an industry's Five Forces? A. The degree of profitability in the industry relative to other industries B. Factors that contribute to competitive pressures in an industry C. Strategies and strategic approaches of rival companies in an industry D. Actions a company can take to shift the competitive dynamics in the company's favor E. Avenues a company can take to protect itself from competitive pressures.

C

Which of the following is NOT true of driving forces? A. One of the most important aspects of analyzing driving forces is to determine their collective impact on industry supply and demand. B. Of all the forces impacting a company, only 3 or 4 are likely to be true driving forces. C. Product life cycle changes within the industry are one kind of driving force. D. Changes in product production costs among competitors qualify as a driving force. E. The real payoff for strategy comes in drawing conclusions about strategic changes that should be made as a result of those driving forces.

C

The five forces framework is a powerful tool used to evaluate industry dynamics and competitive pressures. Select the answer below that does NOT represent one of the five forces. A. The threat of entry of new competitors B. Competitor rivalry C. The power of substitutes D. Price sensitivity of buyers E. The power of suppliers in negotiating with industry competitors

D

Which is NOT considered a common driving force with the capability to produce major, lasting changes in an industry and competitive conditions? A. Diffusion of technical know-how across companies and countries B. Increasing globalization C. Advances in technology and manufacturing process innovation D. Movement in the economy and in interest rates E. Changing societal concerns, attitudes, and lifestyles

D

Which of the following is NOT TRUE regarding the PESTEL tool? A. PESTEL is a tool used to evaluate the external and uncontrollable factors that impact different companies in different industries in different ways B. The most strategically-relevant macro factors (often referred to as "disruptive" forces or long-term trends) include those that are very large in scale, span multiple industries, represent changes in scope or scale from what has been for an extended period of time, have an impact that is sustained over a long period of time, have the potential to significantly, impact a company's long-term direction and strategy C. PESTEL is an acronym representing the following macro factors: Political, Economic, Sociocultural, Technological, Environmental, Legal/Regulatory D. The following are all examples of macro factors that can be identified using the PESTEL tool: lifestyles that impact demand for particular goods and services, water shortages, labor laws, tariffs, competitor actions to gain market share, and the pace of technological change and technological developments that have the potential for wide-ranging effects on society.

D

To determine the best course of strategic action for a company (whether or not a company's strategy should change and how), the two considerations include an assessment of macro factors followed by an analysis of five forces. True False

False

Rarely are there more than five key success factors in an industry; and among them, two or three stand out as most important. True False

True