Ch.11

Which of the following products and services depend on standards?

All of the above (cellular communications, internet, video gaming, high-definition television)

which of the following is not an example of a way a seller can increase switching costs?

creating a product line compatible with parts that are made by other manufacturers

what type of isolating mechanisms increase the economic power of a competitive advantage over time once a firm has acquired that advantage?

early-mover advantages

which of the following terms best describes the situation when sources of competition advantage in an industry are being created and eroded at an increasingly rapid rate?

hypercompetition

which of the following terms best describes a place in which a firm can sell its ideas for full value?

market for ideas

what term describes the situation where a firm does exceedingly well due to good luck or exceedingly poorly due to bad luck, but returns to normal performance following?

regression to the mean

what term describes a framework used in strategy based on resource heterogeneity which posits that for a competitive advantage to be sustainable, it must be underpinned by resource capabilities that are scarce and imperfectly mobile?

resource-based theory of the firm

what term best describes firm-specific assets such as patents and trademarks, brand-name reputation, installed base, and organizational culture?

resources

which of the following is not an impediment to imitation?

scale diseconomies

what term best refers to fundamental changes that lead to major shifts of competitive positions in a market?

shock

which of the following terms best describes a phenomenon whereby, despite equal innovative capabilities, an entrant is willing to spend more to develop on innovation?

the replacement effect

What term best describes clusters of activities that a firm does especially well in comparison with other firms?

Capabilities

Which of the following is the weakest example of a "shock"?

Contracting to use another firm's proprietary process

What term best describes assets that are more valuable when used together than when separated?

Cospecialized

Size, growth, and character of home demand for a firm's product are examples of what?

Demand conditions

Which of the following terms best describes the ability of a firm to maintain and adapt the capabilities that are the basis of its competitive advantage?

Dynamic capabilities

Which of the following is least likely a characteristic of profit persistence in an industry?

Economic profits should quickly converge to zero

Which of the following terms describes a nation's position with regard to the elements (e.g. human resources, infrastructure) of production that are necessary to compete in a particular industry?

Factor conditions

What term best describes a resource that cannot "sell itself" to the highest bidder?

Imperfectly mobile

Which of the following is not a Legal Restriction?

Intellectual property

What product characteristic refers to the situation where consumers place higher value on a product if other consumers also use it?

Network effect

What term best characterizes the battle between firms to innovate first?

Patent race

What term best describes the characteristic of a process if past circumstances could exclude certain evolutions in the future?

Path dependence

Which of the following terms best describes an idea, developed by Gary Hamel and C.K. Prahalad, which combines commitment to the firm's ambitions with the flexibility to change with circumstances?

Strategic stretch

Which of the following is not an isolating mechanism that falls under the heading of early-mover advantage?

Superior access to inputs or customers