WPC 470 Chapter 4 Quiz

Which of the following explains how dynamic capabilities are different from the resource-based view?

Dynamic capabilities deal with applying resources over time.

FL Systems Inc. and Oryxo Systems Inc. are two competing firms. FL Systems Inc. has $300,000 in tangible assets and $200,000 in intangible assets. Oryxo Systems Inc. has $150,000 in tangible assets and $347,000 in intangible assets. In the context of the resource-based view, which of the following is the most likely implication of the asset values of the two companies?

FL Systems Inc. will find it harder than Oryxo Systems Inc. to attain competitive advantage.

When asked to explore the strengths and weaknesses of a firm, which of the following would be the best framework to employ?

None of these answers are correct.

Onivo Auto Inc. has been the leader in low-cost and fuel-efficient engine technology for many years. It has been able to sustain its competitive advantage primarily because of its highly efficient automobile engines, which competitors have been unable to develop or buy at a reasonable price. In the context of the VRIO framework, which of the following resource attributes most likely underpins Onivo's competitive advantage?

The resource is costly to imitate.

Which of the following statements accurately brings out the distinction between a firm's resources and capabilities?

While resources reinforce core competencies, capabilities allow managers to orchestrate their core competencies.

If a firm is not effectively organized to exploit the competitive potential of a valuable, rare, and costly to imitate (VRI) resource, the best case scenario is

a temporary competitive advantage.

A firm's _______ are best described as distinct and fine-grained business processes such as order taking, physical delivery of products, or invoicing customers.

activities

In the context of the VRIO framework, a resource is said to be valuable if it

allows a firm to take advantage of an external opportunity.

In a perfectly competitive industry structure

any competitive advantage that one firm has will be short-lived.

In the dynamic capabilities perspective, for an asset or a capability to be included in a firm's resource stock, it should be

built through investments over time.

In the context of the SWOT matrix, which of the following best exemplifies an external opportunity for a firm?

decreasing government interference in the target market

For a firm to sustain its competitive advantage, any fit between its internal strengths and the external environment must be

dynamic.

In the context of SWOT analysis, a firm can develop a defensive strategic option primarily by

eliminating an internal weakness to mitigate an external threat.

Patents, designs, copyrights, trademarks, and trade secrets are five forms of

intellectual property.

According to the value chain analysis, which of the following is a support activity?

research and development

A firm decides to retain $20,000 from its annual earnings and invest it in developing an advanced manufacturing system. According to the dynamic capabilities perspective, the $20,000 would most likely be referred to as the firm's

resource flow.

Even though Easy Speak Inc. and KM Com Inc. operate in the same industry—telecommunications—each firm has a different and loyal customer base. While Easy Speak Inc. attracts young students and professionals through its efficient network coverage and pricing, KM Com Inc. attracts elderly customers solely due to its excellent customer service. Thus, both firms draw their strengths from distinct resource bundles. Which of the following assumptions of the resource-based model of competitive advantage does this scenario best illustrate?

resource heterogeneity

Which of the following is an example of a firm's capabilities?

skills involved in training and managing a workforce

Which of the following SWOT factors are internal to the firm?

strengths and weaknesses

According to the resource-based view, a firm's competitive advantage often stems from its ___________ opposed to its ___________.

tangible resources, intangible resources

The auditor of a public company is assessing the value of all the intangible assets owned by the company. Which of the following would most likely be included in this assessment?

the company's brand equity

While most of Savvy Inc.'s competitors were moving toward developing and emerging markets, Savvy Inc. decided to keep its operations limited to its home country so that it could gain some advantage. A few years later, however, Savvy Inc. lost its footing in the home market due to a sharp fall in demand. It then decided to invest in large-scale operations in the same developing nations as its competitors, within a short period of six months. However, its costs kept increasing, so it could not compete against the already established brands. In this scenario, the failure of Savvy Inc. can be best attributed to

time compression diseconomies.

Using the _______, managers can see how competitive advantage flows from a firm's distinct set of activities.

value chain analysis

The _______ describes the internal activities a firm engages in when transforming inputs into outputs.

value chain view

Which of the following is not one of the VRIO characteristics of competitive advantage?

variable