MGMT 162 Quiz Study Guide

Which of the following statements is true of the social responsibilities of a business?

A firm's ethical responsibilities go beyond its legal responsibilities

Which of the following best describes a level 5 manager?

Aoska is the CEO of Green Machines inc, he has helped his company in gaining and sustaining a competitive advantage through ethical decision making

Pure Carat Inc. is a company that sells 24-carat gold biscuits to companies that manufacture jewelry. Since the company operates in an industry where many other suppliers sell standardized products, it can most likely A. easily achieve a temporary competitive advantage. B. easily achieve a sustainable competitive advantage. C. only achieve competitive parity. D. maintain its absolute advantage for long time.

C. only achieve competitive parity.

Underperformance relative to other firms in the same industry or the industry average results in a(n) for a firm

Competitive Disadvantage

What is an implication of low interest rates?

Consumer demand will increase

Which of the following summarizes the difference between corporate strategy and business strategy?

Corporate strategy deals with where to compete; business strategy deals with how to compete

Why is it better for firms to keep their vision statements customer-oriented rather than product-oriented?

Customer-oriented visions tend to have a more myopic view of changing environments

The first step to gain and sustain a competitive advantage is to

Define a firm's vision, mission, and values

Tesla hopes to benefit from ____ by going into a much less crowded niche and overall car industry

Economies of scale

T/F: A firm is required by society and its shareholders to meet its ethical and philanthropic responsibilities

False

T/F: Because they are a crucial component of a firm's success, customers are considered internal stakeholders

False

Cobalt Sodas has seen its market share erode in recent years, as consumers increasingly turn toward healthier beverage choices such as unsweetened sparkling water. Hoping to rekindle interest in sugary sodas, Cobalt decides to product a limited run of "throwback" cans using labeling first introduced in the 1980s. What is wrong with this strategy?

It fails to face the competitive challenge

The average cost of production for a bottle of vitamin water in the industry if $4 while its avg price is $7/ StoreAll Inc. manufactures the same product for $3 per bottle and sells it for $7 per bottle. Which of the following statements is most likely true of StoreAll inc in this scenario?

It has a competitive advantage in the industry.

Which of the following is typically an economic responsibility of a firm?

Paying adequate returns to the firm's stockholders on the capital invested by them

To reduce the amount of time it takes to apply packaging to its finished products, NorthStar Foods is implementing new equipment at its production plants. This would be a _____ in value chain analysis

Primary Activity

Dynamic capabilities are especially relevant for surviving and competing in markets that _______

Shift quickly

When rival companies don't understand the relationship between resources and capabilities controlled by the firm, the firm's competitive advantage is protected against imitation by ______

Social complexity

A firm's _____ relates to its ability to create value for customers (V) while containing the cost to do so (C).

Strategic Position

The Company's cost are substantially lower than competitors because of minimal investment in operation and administration. In this scenario, the company has most likely been able to provide superior value and cost control through

Strategic Positioning

When fashion magazines face competition from fashion blogs on the web, which of the following forces in Michael Porter's five forces model primarily gets stronger?

Threat of substitutes

According to the resource-based view, a firm that differentiates itself from its competitors through its personalized approach to customer service is likely to sustain its competitive advantages for a long time

True

T/F: A surprise event that leads to a change in strategic initiatives, such as the accidental discovery of a new use for an existing product, is known as serendipity

True

T/F: Core values provide ethical guidelines for how individual employees and one for themselves

True

When do employees fail to adopt the organizational values of a firm?

When the top managers in the firm are merely paying lip service to the firm's stated value

Which of the following statements is true of corporate strategy?

a corporate strategy must be able to create synergies across business units that are quite different

To be effective, firms need to

back up their visions with strategic commitments that are costly and difficult to reverse

According to valuation using the VRIO Framework, Crocs was unable to sustain its competitive advantage primarily bc its products were ________

easy to imitate

In the AFI strategy framework, strategy analysis primarily involves

evaluating the effects of internal resources and core competencies on a firm's potential to gain and sustain a competitive advantage

To implement specific business strategies, general managers of strategic business units rely on...

functional managers

The management of Toshi Manufacturing showed a commitment to ________ by increasing the salary of many female employees to meet its goal of having equal pay for the women and men who perform comparable work

organizational core values

Planning for specific unique events with responses if any of these situations occur are using

scenario planning

The former CEO of Sam's Club reported to the CEO of Walmart making Sam's Club a ....

strategic business unit

Corporate strategy decides _____ to do business

where

While implementing strategic group mapping for the U.S. domestic airline industry, two strategic groups become apparent: low-cost, point-to-point airlines (Virgin Atlantic, Alaska Airlines, JetBlue, and Southwest Airlines) versus differentiated airlines using a hub-and-spoke system (American, Delta, and United). Which of the following statements is true about these two strategic groups? A. Competitive rivalry between Virgin Atlantic and JetBlue is likely to be higher than that between American and Southwest airlines. B. American, United, and Delta airlines will be affected differently by Porter's five competitive forces. C. Alaska Airlines and Delta airlines will be affected by the external environment in very similar ways. D. Competitive rivalry between Virgin Atlantic and Delta airlines is likely to be higher than that between American, Delta, and United.

A. Competitive rivalry between Virgin Atlantic and JetBlue is likely to be higher than that between American and Southwest airlines.

To help a firm achieve a competitive advantage, each distinct activity performed in the value chain needs to A. contribute to the firm's strategic position as either low-cost leader or differentiator. B. reduce the immobility and the heterogeneity of the firm's resources. C. create a static fit between the company's internal resources and the external environment. D. reduce the causal ambiguity and the social complexity of the firm's source of success.

A. contribute to the firm's strategic position as either low-cost leader or differentiator.

In the context of the SWOT matrix, which of the following best exemplifies a firm's internal strength? A. increase in a firm's customer loyalty B. growth in the size of the market in which a firm operates C. rise in the income of the demographic segment to which a firm caters D. loss of a competitor's reputation

A. increase in a firm's customer loyalty

T/F: Firms within the same industry automatically belong to the same strategic group

False

T/F: High demand for online video streaming options is one of Netflix's core competencies

False

T/F: Managers should create two sets of core values, one for employees and one for themselves

False

T/F: Product-oriented vision statements are better suited than customer oriented vision statements for helping companies to adapt to changes in the external environment

False

T/F: Strategic leaders spend the majority of their time working alone to devise new strategies

False

T/F: a good strategy is a set of actions that enables a firm to achieve its own internal goals without regard to the external environment

False

Which of the following external forces is a part of a firm's task environment?

The composition of the strategic group to which the firm belongs

T/F: Questions asked during the strategy analysis stage of the AFI Framework include: "How does the firm make money?" and "What effects fo forces in the external environment have on the firm's potential to gain and sustain competitive advantage?"

True

T/F: The core competencies of a firm are determined by the interplay of its tangible resources and intangible capabilities

True

T/F: Under the strategy as a planned emergence model, even entry-level employees can help generate strategic initiatives

True

t/f: Because competitors in oligopolistic industries are so interdependent, it is especially important for managers in those firms to monitor and respond to changes their competitors make

True

The primary objective of Porter's five forces model is to ______

Understand the profit potential of industries