MGT 445

Due to its large sales volume and low cost structure, Quick Serve Mini-Marts enjoys a cost leadership position. Which of the following scenarios might threaten Quick Serve's competitive advantage? A) A new competitor is perceived to provide similar value, but in addition offers innovative self-checkout. B) Competitors engage in an all-out price war. C) Industry suppliers raise their prices. D) Existing competitors in the mini-mart industry lower their prices to match those of Quick Serve.

A) A new competitor is perceived to provide similar value, but in addition offers innovative self-checkout.

A blue ocean strategy differs from a low-cost strategy in that A) the intent of a blue ocean strategy is not to be the absolute lowest-cost provider because a blue ocean must also increase perceived value. B) a blue ocean's research and development focus is on process technologies, and a cost-leader's focus is on product technologies. C) economies of scale are more important to a blue ocean strategy, while economies of scope are more important to a cost-leader. D) the focus of a blue ocean strategy is on lowering the economic value created, whereas a cost-leader focuses on increasing the economic value created.

A) the intent of a blue ocean strategy is not to be the absolute lowest-cost provider because a blue ocean must also increase perceived value.

Which of the following best describes how Trader Joe's maintain its strategy? A) Cutting labor costs through low wages B) Offering unique products under Trader Joe's company name C) Holding a large volume of inventory D) Opening stores in prime locations

B) Offering unique products under Trader Joe's company name

Tangles Costume Jewelry offers slightly lower quality merchandise than competitors at a much lower price. What strategy is Tangles using? A) differentiation B) cost-leadership C) product diversification D) niche marketing

B) cost-leadership

How is a cost-leader protected from threats from powerful suppliers? A) It is able to create a significant difference between perceived value and current market prices. B) It is more able to absorb price increases through generating higher profit margins. C) It is more able to absorb price increases through accepting lower profit margins. D) It is able to create a significant difference between actual value and future market prices

C) It is more able to absorb price increases through accepting lower profit margins.

Which of the following best explains why a blue ocean strategy is difficult to implement? A) It requires the combination of fundamentally similar strategic positions—differentiation and strategic innovation. B) It combines the benefits of similar strategic positions—differentiation and low cost. C) It requires the reconciliation of fundamentally different strategic positions—differentiation and low cost. D) It requires the reconciliation of fundamentally different strategic positions—differentiation and strategic innovation.

C) It requires the reconciliation of fundamentally different strategic positions—differentiation and low cost.

What must a cost-leadership strategy accomplish to be successful? A) It must increase the firm's cost above that of its competitors while offering superior value. B) It must reduce the firm's cost below that of its competitors while offering superior value. C) It must increase the firm's cost above that of its competitors while offering adequate value. D) It must reduce the firm's cost below that of its competitors while offering adequate value

D) It must reduce the firm's cost below that of its competitors while offering adequate value

Starfish Sodas has successfully achieved a competitive advantage in the soft drink industry as a differentiator. Which of the following scenarios would undermine Starfish's position? A) Starfish introduces a new biodegradable bottle that raises cost and perceived value. B) Starfish improves the recipe for its most popular soda without increasing the price. C) Starfish's product has not established an acceptable standard of quality. D) Starfish's customers start to consider soda a commodity

D) Starfish's customers start to consider soda a commodity

Which of the following is False about the history of Trader Joe's? A) Aldi acquired Trader Joe's in 1979. B) Joe Coulombe was influenced by the environmental movement and offered organic products in Trader Joe's. C) Joe Coulombe aimed to address the needs of educated people who looked for something different. D) Trader Joe's stores were very big spaces and stocked as many products as typical supermarkets.

D) Trader Joe's stores were very big spaces and stocked as many products as typical supermarkets.

A differentiation strategy works best when a A) firm's differentiated products are commoditized, and costs of providing uniqueness do not rise above the customer's willingness to pay. B) the firm has tangible resources, its focus of competition shifts to price, and equivalent substitutes are readily available. C) firm's focus of competition shifts to price, and when increasing differentiation of product features do not create additional value. D) the firm has intangible resources, is able to pass on increases in supplier cost to the customer, and its differentiation appeal creates customer loyalty

D) the firm has intangible resources, is able to pass on increases in supplier cost to the customer, and its differentiation appeal creates customer loyalty