MGMT 425 Exam 1 Practice Questions

A) subscription-based B) peer-to-peer C) crowdsourcing D) freemium Answer: A

AromaMax produces electric bathroom fragrance diffusers and sells the electric outer device at a market rate price. However, they lock their clients into a two-year agreement to purchase the perfume refills solely from them on a monthly basis. Which of the following business models does this best illustrate?

A) key strategic resources and a firm's capabilities. B) export barriers, trade barriers, and credit barriers faced recently by the company. C) tax policy changes driven by federal programs and R&D grants at the state level. D) knowledge brought in by new graduates and the mentoring they receive from existing employees. Answer: A

Core competencies are derived from the combination of...

A) satisficing. B) optimal decision making. C) the illusion of control. D) escalating commitment. Answer: A

Deshon is exploring multiple suppliers in order to find the best price. However, instead of calling all eight potential suppliers, he only reaches out to the first three and bases his selection on those instead of contacting all suppliers. Deshon's action best describes the concept of...

A) sociocultural B) healthy eating C) political D) legal Answer: A

In recent years a growing number of U.S. consumers have become more health-conscious about what they eat. According to the PESTEL Framework this trend could best be classified as a ________ trend.

A) subscription-based B) peer-to-peer C) crowdsourcing D) freemium Answer: D

LinkedIn, a professional social media website, allows its users to create their profiles for free, but charges a premium price for additional services. This is an example of a ________ business model.

A) AFI Strategy Framework. B) business model analysis. C) Six Sigma tool. D) Stakeholder Impact analysis. Answer: A

Martha wants to open her own bakery, but she doesn't know anything about business. She needs help determining who her competition is, how she should craft her strategy to compete and how she'll implement her strategy to achieve a competitive advantage. She's hired you to help her get started. As a result, you know that you will probably use the...

A) cognitive limitations. B) optimal decision making. C) the illusion of control. D) escalating commitment. Answer: A

Miguel is exploring multiple suppliers in order to find the best price. However, instead of calling all nine potential suppliers, he only reaches out to the first four and bases his selection on those instead of contacting all suppliers. Miguel's action best describes the concept of...

Answer: D A) Ming's strategy makes sense and he should move forward with it. B) Ming's strategy reveals a clear strategic position and tradeoff, so he should proceed. C) Ming should reevaluate his statement because it fails to mention human resources and finance. D) Ming should reevaluate his statement because it fails to meet the principles of what a strategy should be. Answer: D

Ming is interested in the concept of strategy and decides to create his own. As a result, Ming says that his strategy is to focus on growth and marketing to achieve competitive advantage. How would you evaluate Ming's statement?

A) ecological B) economic C) political D) technological Answer: A

Tesla is addressing environmental concerns regarding the carbon emissions of gasoline-powered cars by building zero-emission battery-powered vehicles. This best represents which of the following PESTEL categories?

A) Companies exist because they create value for customers in ways that customers are unable to replicate on their own. B) Companies exist because they provide a means of investment income for shareholders, who otherwise would be able to invest only in government securities. C) Companies exist because they provide a tax base for government to draw upon in creating and maintaining public works projects. D) Companies exist because they give college professors something to teach about. Answer: A

When performing internal analysis of firms, how would you answer the question, "Why do companies exist?"