Quiz 3
Horizontal integration through M&A can help firms strengthen their competitive position by increasing the differentiation of their product and service offerings.
TRUE
Susan owns a firm that is considered fully integrated. Which of the following statements below would best describe a firm that is fully integrated?
All of Susan's business activities are conducted within the boundaries of the firm.
Billy is the CEO of Billy kicks, a soccer ball retailer. He decides to purchase the synthetic rubber manufacturing firm so he can create his own soccer balls and sell them, nationally, in his retail stores. In order to do this, Billy will need to engage in_______, which is a corporate level strategy.
Backward vertical integration
Bob is the strategic business unit (SBU) CEO in charge of manufacturing cufflinks for men's clothing. While the market he competes in is low growth, Bob's SBU earnings and cash flow are both ranked at high and stable. When examining Bob's SBU through the Boston Consulting Group (BCG) matrix lens, We can conclude that his SBU would be classified as a
Cash Cow
John owns John's Trucking Corporation and is trying to determine if his firm should engage in vertical integration and diversify the range of services his business sells. Before John goes through these decisions, he'll need to consider what is his
Corporate level Strategy
Pete E' Gee sell's Big Dog Choppers, a special type of motorcycle. His business generates roughly 80 percent of his revenues from selling these motorcycles and about 20 percent on motorcycle repair and service. Pete E' Gee would be classified as a ________ firm.
Dominate Business
In general, it is short-sighted to acquire companies as a defensive move to prevent rival organizations from gaining access to certain patents, technology,or customer bases.
FALSE
Jill is the CEO of Note's Etc, a stationary manufacturer. She decides to open up a retail store to sell her products directly to consumers instead of just selling to retailers. In order to do this, Jill will need to engage in ________, which is a corporate level, strategy.
Forward Vertical Integration
There are many reasons why firms need to grow. Which of the following reasons is strongly influenced by economies of scale?
Lowering Costs
Decisions relating to "what stages of the industry value chain to participate in" determine a firm's
vertical integration