Chapter 5 Quiz

3) Which of the following statements is true of accounting data?

Accounting data are historical data and thus backward-looking.

1) In 2014, Apple had a return on revenue of 29.3 percent, and Microsoft had a return on revenue of 32 percent. Even so, Apple had a higher return on invested capital than Microsoft. Why did this happen?

Apple was able to charge a much higher margin for its products and services than Microsoft

10) The balanced scorecard can accommodate

Both short-and long-term metrics

4) Janet is CEO of Far Sight Inc., which uses a triple-bottom -line approach. As a result, Janet will tend to:

Expect her company to be socially responsible.

5) Which of the following expressions accurately describes market cap?

It is the product of the number of outstanding shares and the share price.

7) Which of the following is a disadvantage of the balanced-scorecard approach?

It provides limited guidance about which metrics to choose.

9) Airbnb rents spaces that previously would have been unused to generate revenue, while also dramatically increasing the potential amount of accommodation space in the 191 countries. This business uses a Blank technique.

Peer-to-peer

2) Economic value creation is best expressed as

Producer surplus minus consumer surplus

6) Which of the following approaches to assess competitive advantage is based on the view that noneconomic factors can have a significant impact on a firm's financial performance?

The triple-bottom -line approach

8) During the process of formulation an effective business model, a firm's managers should first,

Transform their strategy of how to compete into a blue print of actions and initiatives.