Management Exam 2

23. A multinational company that acts with _____ has offices, manufacturing plants, and distribution facilities in different countries that are run based on the same rules, guidelines, policies, and procedures. a. policy certainty b. global consistency c. global adaptation d. global certainty e. regiocentrism

b. global consistency

17. The purpose of a _____ strategy is to increase profits, revenues, market share, or the number of places (stores, offices, locations) in which the company does business. a. divestment b. growth c. niche d. retrenchment e. recovery

b. growth

83. A(n) _____ resource is a resource that is impossible or extremely costly or difficult for other firms to duplicate. a. accessible b. imperfectly imitable c. nonsubstitutable d. obsolete e. slack

b. imperfectly imitable

66. A company's purpose statement _____.​ a. ​changes from country to country b. ​contains all the rules of the company c. ​is enduring and inspirational d. ​is a short-term goal or subgoal e. ​deals with unique, one-time-only events

c. ​is enduring and inspirational

77. A(n) _____ is a brief, two-sentence statement of a company's purpose for existing.​ a. ​action plan b. ​budget c. ​organizational mission d. ​policy e. ​standing plan

c. ​organizational mission

47. An expatriate is someone who _____. a. claims dual citizenship b. lives and works outside his or her own country c. believes strongly in nationalization d. is unhappy with his or her present residence e. desires to be employed in a country other than his or her own country

b. lives and works outside his or her own country

78. According to the S.M.A.R.T. guidelines, goals should be ____. a. broad b. measurable c. rational d. nonspecific e. actionable

b. measurable

57. Formal project review points used to assess progress and performance are called _____. a. prototypes b. milestones c. dominant designs d. change forces e. change agents

b. milestones

35. The first step in the compression approach to innovation is _____. a. overlapping of the individual steps b. planning c. supplier involvement d. granting autonomy e. creating multifunctional teams

b. planning

98. _____ are the targets that managers use to measure whether their firm has developed the core competencies that it needs to achieve a sustainable competitive advantage. a. Strategic reference points b. Strategic design iterations c. Differentiation targets d. Imperfectly imitable resources e. Strategic monitors

a. Strategic reference points

56. Which of the following is NOT one of the characteristics of S.M.A.R.T. goals? a. Synergistic b. Measurable c. Timely d. Attainable e. Realistic

a. Synergistic

16. _____ occurs when customers purchase new technologies to replace older technologies. a. Technological substitution b. Entropy c. Incremental environmental change d. Organizational synergy e. Transition management

a. Technological substitution

39. The use of _____ in planning produces a false sense of certainty and is often cited as one of the major pitfalls of planning. a. assumptions b. commitment c. flexibility d. tactics e. benchmarking

a. assumptions

44. The most popular approach to increasing goal commitment is ____. a. encouraging workers' participation in goal setting b. assigning goals to workers c. getting top management's support d. assigning unattainable goals e. management by mentoring

a. encouraging workers' participation in goal setting

91. State-of-the-art companies with sales, employees, and financing in different countries that are found with an active global strategy are called _____. a. global new ventures b. strategic alliances c. wholly owned affiliates d. franchisees e. subsidized corporations

a. global new ventures

10. ​Management by objectives (MBO) is a management technique often used to develop and carry out. a. ​single-use plans b. ​standing plans c. ​operational plans d. ​tactical plans e. ​visionary plans

d. ​tactical plans

84. A(n) _____ strategy is a broad corporate-level strategic plan used to achieve strategic goals and guide the strategic alternatives that managers of individual businesses or subunits may use. a. grand b. regulation c. utilitarian d. distributive e. industry

a. grand

27. For options-based planning to work, the organization must _____. a. have slack resources b. use cross-functional teams c. have broad spans of management d. have tall organizational structures e. use centralization

a. have slack resources

54. A _____ is a strategic alliance in which two existing companies collaborate to form a third, independent company. a. joint venture b. franchise c. wholly owned affiliate d. global new venture e. cooperative contract

a. joint venture

46. The last step in effective planning is to _____. a. maintain flexibility in planning b. develop long-term action plans c. develop goal commitment d. acculturate the employees e. track progress toward goal achievement

a. maintain flexibility in planning

60. The basic purpose of _____ planning is to leave commitments open by maintaining slack resources. a. options-based b. learning-based c. traditional d. proximal e. single-use

a. options-based

43. A(n) ____ is a standing plan that indicates the general course of action that should be taken in response to a particular event or situation. a. policy b. procedure c. rule d. regulation e. heuristic

a. policy

82. The ____ is a type of operational plan that saves managers time because it is created once and then used repeatedly to handle frequently recurring events. a. standing plan b. budget c. single-use plan d. options-based plan e. forecast

a. standing plan

2. A(n) _____ is a direct tax on imported goods. a. tariff b. nontariff barrier c. trade roadblock d. boycott quota e. import subsidy

a. tariff

68. The _____ is a measure of the degree to which barriers to entry make it easy or difficult for new companies to get started in an industry. a. threat of new entrants b. scope of new SBUs c. character rivalry d. bargaining power of suppliers e. bargaining power of new buyers

a. threat of new entrants

7. One method of weighing decision criteria uses ____, which is a process where each decision is compared directly to every other criterion. a. absolute comparisons b. relative comparisons c. valences d. minimum threshold rule e. comparative ranking scales

b. relative comparisons

28. The General Electric workout is a special kind of ____. a. activity-oriented change b. results-driven change c. generational change d. coercion-driven change e. resources-driven change

b. results-driven change

90. According to Michael Porter, _____ is one of the five industry forces that determine an industry's overall attractiveness and potential for long-term profitability. a. threat of new entrants b. span of management c. organizational synergy d. bureaucratic management e. organizational stability

a. threat of new entrants

93. Which of the following is one of the three steps in the basic process of managing organizational change outlined by Kurt Lewin? a. unfreezing b. organizational dialogue c. change definition d. incremental change e. change mentoring

a. unfreezing

9. In the context of BCG matrix, ​_____ are companies that have a large share of a fast-growing market. a. ​Dogs b. ​Stars c. ​Cash cows d. ​Core firms e. ​Question marks

b. ​Stars

74. According to Hofstede's research on cultural dimensions, _____ cultures emphasize the importance of relationships, modesty, caring for the weak, and quality of life. a. economic-based b. feminine c. relationship-oriented d. individualistic e. masculine

b. feminine

36. ____ is the process of choosing a solution from available alternatives. a. Decision making b. Divesting c. Deskilling d. Environmental scanning e. Self-dealing

a. Decision making

92. When resistance to change is based on insufficient, incorrect, or misleading information, which of the following is the best approach that a manager can use to manage resistance to change? a. Education and communication b. Participation c. Negotiation d. Coercion e. Change manipulation

a. Education and communication

58. _____ strategies typically work in market niches that competitors have overlooked or have difficulty serving. a. Focus b. Mass production c. Deskilling d. Unrelated diversification e. Entropy

a. Focus

14. Who among the following is responsible for developing operational plans? a. Lower-level managers b. Middle managers c. Top managers d. Shareholders e. Board of directors

a. Lower-level managers

65. The _____ created a regional trading zone in Europe. a. Maastricht Treaty b. Free Trade Agreement c. Global Agreement for Transactional Trading d. Asia-Pacific Economic Cooperation e. Association of Southeast Asian Nations

a. Maastricht Treaty

52. What are the two types of political risk that affect companies conducting global business? a. Political uncertainty and policy uncertainty b. Policy uncertainty and expropriation potential c. Cultural strength and political risks d. Infrastructure dynamism and political uncertainty e. Nationalism and economic uncertainty

a. Political uncertainty and policy uncertainty

13. _____ refers to the risk associated with changes in laws and government schemes that directly affect the way foreign companies conduct business.​ a. ​Policy uncertainty b. ​Power distance c. ​Political uncertainty d. ​Cultural simulations e. Purchasing power

c. ​Political uncertainty

94. What type of planning would be used to create the festivities necessary to celebrate the 100-year anniversary of a furniture manufacturing company? a. A single-use plan b. An action plan c. A strategic plan d. A standing plan e. A policy

a. A single-use plan

76. _____ are defined as workplace cultures in which workers perceive that new ideas are welcomed, valued, and encouraged. a. Creative work environments b. Centralized work envvironments c. Homogeneous work environments d. Bureaucratic work teams e. Hierarchical work stations

a. Creative work environments

50. ​Global business: a. ​is the buying and selling of goods and services to people from different countries. b. ​includes any sale of goods and services. c. ​only involves companies with more than 50 employees. d. ​is the setting up of a factory in a country other than the parent country. e. ​is unregulated.

a. ​is the buying and selling of goods and services to people from different countries.

71. _____ are companies that have a small share of a slow-growing market. a. Stars b. Dogs c. Cash cows d. Question marks e. Core firms

b. Dogs

5. Which of the following is a commonly used method for increasing goal commitment? a. Creating unattainable goals b. Making goals public c. Getting the union's support d. Using the equity theory e. Creating less challenging goals

b. Making goals public

51. _____ planning allows companies to maintain flexibility by making small simultaneous investments in many alternative plans. a. Strategic b. Options-based c. Action-based d. Functional e. Operational

b. Options-based

100. ____ are standing plans that indicate the specific steps that should be taken in response to a particular event. a. Policies b. Procedures c. Actionable plans d. Options-based plans e. Single-use plans

b. Procedures

96. Which of the following factors helps a company determine the growth potential of a foreign market? a. Political uncertainty b. Purchasing power c. Type of infrastructure d. Land availability e. Policy uncertainty

b. Purchasing power

64. ____ is a systematic process of defining problems, evaluating alternatives, and choosing optimal solutions. a. Problem identification b. Rational decision making c. Benchmarking d. Multivariable selection e. Keystoning

b. Rational decision making

99. _____ plans specify how a company will use resources, budgets, and people to accomplish specific goals within its mission. a. Strategic b. Tactical c. Operational d. Single-use e. Visionary

b. Tactical

12. In the typical S-curve pattern of innovation, small amounts of effort will result in significant increases in performance _____. a. during the lockout stage of the cycle b. at the midpoint of the cycle c. only at the end of the cycle d. throughout the cycle e. only at the beginning of the cycle

b. at the midpoint of the cycle

75. Refer to Coca-Cola. The need for Coke to create a promotional strategy specifically targeted to the Indian market reflects a(n) _____. a. diversification strategy b. awareness of cultural differences c. desire to maintain a high contribution margin d. insular approach to strategy e. desire to maintain global consistency

b. awareness of cultural differences

25. It is appropriate to use a(n) _____ approach to manage innovation in more certain environments, in which the goals are lower costs and incremental improvements in the performance and function of an existing technological design. a. experiential b. compression c. prototypical d. milestones e. reinforcement

b. compression

18. A(n) _____ is an agreement in which a foreign business owner pays a company a fee for the right to conduct that business in his or her country. a. exporting agreement b. cooperative contract c. joint venture d. strategic alliance e. free-trade agreement

b. cooperative contract

87. The term _____ refers to the overall organizational strategy that addresses the question "What business or businesses are we in or should we be in?" a. firm-level strategy b. corporate-level strategy c. industry-level strategy d. portfolio strategy e. operations strategy

b. corporate-level strategy

95. The _____ approach to innovation assumes that innovation is occurring within a highly uncertain environment. a. compression b. experiential c. technological substitution d. generational change e. technological disruption

b. experiential

62. Documentary training focuses on _____.​ a. ​identifying the similarities between cultures b. ​identifying specific critical differences between cultures c. ​determining the number of expatriates who will be able to adjust to a culture d. ​grouping countries with cultural similarities together e. ​testing how quickly expatriates adjust to a culture

b. ​identifying specific critical differences between cultures

15. The _____ is a portfolio strategy that managers use to categorize their corporation's businesses by growth rate and relative market share. This strategy helps them to decide how to invest corporate funds. a. investment matrix b. SWOT matrix c. BCG matrix d. portfolio management matrix e. Maslow grid

c. BCG matrix

24. _____ is the measure of the intensity of competitive behavior between companies in an industry. a. Character of culture b. Competitive barrier c. Character of the rivalry d. Anti-competitiveness e. Process gain

c. Character of the rivalry

38. The ____ is a decision-making method in which a panel of experts responds to questions and to each other until an agreement is reached on how a specific issue should be handled. a. dialectical inquiry technique b. nominal group technique c. Delphi technique d. electronic brainstorming technique e. feedback method

c. Delphi technique

33. At which stage of organizational decline does the decline become irreversible? a. Crisis stage b. Faulty action stage c. Dissolution stage d. ​Inaction stage e. Blinded stage

c. Dissolution stage

63. _____ is defined as a philosophy and collection of planned change interventions designed to improve an organization's long-term health and performance. a. S-curve pattern of innovation b. Incremental change c. Organizational development d. Experiential approach to innovation e. Compression approach to innovation

c. Organizational development

59. _____ strategy is a corporate-level strategy that minimizes risk by diversifying investment among various businesses or product lines. a. Industry b. Grand c. Portfolio d. Divesting e. Deskilling

c. Portfolio

89. In the context of managing change, _____ forces support the status quo. a. Dialectical b. Generational c. Resistance d. Experiential e. Autonomous

c. Resistance

41. Which of the following is the most specific type of standing plan? a. Policies b. Procedures c. Rules and regulations d. Budgets e. MBO plans

c. Rules and regulations

22. The trade agreement that represented the most significant change to the regulations governing global trade during the 1990s was the _____. a. Maastricht Treaty of Europe b. North American Free Trade Agreement c. World Trade Organization d. Asia-Pacific Economic Cooperation e. Asian Free Trade Arrangement

c. World Trade Organization

67. In the _____ stage of organizational decline, cutbacks and layoffs will have reduced the level of talent among employees. a. faulty action b. inaction c. crisis d. dissolution e. blinded

c. crisis

37. A technology _____ begins with the birth of a new technology and ends when that technology reaches its limits and dies as it is replaced by a newer, substantially better technology. a. process b. lockout c. cycle d. hierarchy e. continuum

c. cycle

26. In _____, the old technology and several different new technologies fight to establish a new technological standard or dominant design. a. design substitution b. modular management c. design competition d. technological lockout e. incremental change

c. design competition

86. The ____ approach to decision-making is a method in which an individual or a subgroup is assigned the role of a critic. a. dialectical inquiry b. groupthink c. devil's advocacy d. Delphi e. dyadic communications

c. devil's advocacy

3. When incremental improvements are made to a dominant technological design such that the improved version of the technology is fully backward compatible with the older version, _____ is said to have occurred. a. a milestone b. intuitive change c. generational change d. coercive change e. discontinuous innovation

c. generational change

8. The purpose of a _____ strategy is to turn around very poor company performance by shrinking the size or scope of the business. a. growth b. stability c. retrenchment d. maturity e. repositioning

c. retrenchment

79. In the context of the strategic reference point theory, the _____ strategy aims to protect an existing competitive advantage. a. deskilling b. risk-seeking c. risk-avoiding d. divesting e. risk-extension

c. risk-avoiding

88. According to the S.M.A.R.T. guidelines, goals should be ____. a. aggregated b. broad c. timely d. motivated e. nonspecific

c. timely

81. ​_____ is defined as the purchase of a company by another company. a. ​Downsizing b. ​Recovery c. ​Acquisition d. ​Diversification e. ​Differentiation

c. ​Acquisition

48. ​_____ are the central companies in a strategic group. a. ​Dogs b. ​Cash cows c. ​Core firms d. ​Secondary firms e. ​Question marks

c. ​Core firms

1. _____ occurs when a company sells domestically produced products to customers in foreign countries. a. Direct foreign investment b. Franchising c. Licensing d. Exporting e. Cooperative contract

d. Exporting

11. The _____ has liberalized trade between countries so that business can plan for one market rather than for three separate markets. a. Maastricht Treaty of Europe b. Association of Southeast Asian Nations c. Asia-Pacific Economic Cooperation d. North American Free Trade Agreement e. General Agreement on Tariffs and Trade

d. North American Free Trade Agreement

21. _____ are companies that do not follow a consistent adaptive strategy but instead respond to changes in the external environment after they occur. a. Defenders b. Pioneers c. Analyzers d. Reactors e. Prospectors

d. Reactors

20. ______ are the assets, capabilities, processes, information, and knowledge that an organization uses to improve its effectiveness and efficiency, to create and sustain competitive advantage, and to fulfill a need or solve a problem. a. Grand strategies b. Distinctive competencies c. Competitive advantages d. Resources e. Strategic stances

d. Resources

31. Nearly all technology cycles follow the typical _____ pattern of innovation. a. W-curve b. contingency c. bell-shaped d. S-curve e. lockout

d. S-curve

97. An industry-level strategy that is best suited to changes in the organization's external environment is a(n)_____ strategy. a. positioning b. differentiation c. growth d. adaptive e. diversification

d. adaptive

85. In the typical S-curve pattern of innovation, increased effort (i.e., money, research and development) brings only small improvements in technological performance _____. a. early in the cycle b. throughout the cycle c. halfway through the cycle d. at both the beginning and end of the cycle e. in the maturity stage of the cycle

d. at both the beginning and end of the cycle

70. The nominal group technique improves group decision making by ____. a. requiring the selection of co-leaders to prevent member dominance b. providing predetermined group norms c. eliminating group cohesiveness d. decreasing a-type conflict e. encouraging all members to have an equal voice in the decision making process

d. decreasing a-type conflict

73. Over the long run, the best way for a company to sustain competitive advantage is to create _____ year after year. a. innovation maps b. entropies c. slack resources d. innovation streams e. cognitive dissonances

d. innovation streams

45. A technology cycle occurs whenever there are major advances or changes in the _____ in a field or discipline. a. human, technical, and conceptual skills needed b. structure or personnel requirements c. internal resource environment d. knowledge, tools, and techniques e. way information is retrieved

d. knowledge, tools, and techniques

29. When companies don't anticipate, recognize, neutralize, or adapt to the internal or external pressures that threaten their survival, it results in _____. a. design competition b. resistance to change c. discontinuous change d. organizational decline e. generational change

d. organizational decline

55. Top management is responsible for developing ____. a. appraisal reports b. tactical plans c. operational plans d. strategic plans e. worker schedules

d. strategic plans

34. The phases of a technology cycle within an innovation stream begins with: a. incremental change. b. discontinuous change. c. dominant design. d. technological discontinuity. e. design iteration.

d. technological discontinuity.

30. ​_____ is the degree to which two companies have overlapping products, services, or customers in multiple ventures. a. ​Differentiation b. ​Direct competition c. ​Resource similarity d. ​Market commonality e. ​Character of the rivalry

d. ​Market commonality

4. ​_____ are companies that have a small share of a fast-growing market. a. ​Dogs b. ​Stars c. ​Cash cows d. ​Question marks e. ​Secondary firms

d. ​Question marks

53. ​Organizations can achieve a _____ by using their resources to provide greater value for customers than competitors can. a. ​distinctive competence b. ​strategic dissonance c. ​competitive inertia d. ​competitive advantage e. ​strategic reference point

d. ​competitive advantage

32. What are the strategies that can be used to minimize or adapt to the political risk inherent in global business? a. Protectionist, avoidance, and offensive strategies b. Creative, cooperative, and defensive strategies c. Cooperative, customary, and nationalistic strategies d. Avoidance, protectionist, and guerrilla strategies e. Control, avoidance, and cooperation strategies

e. Control, avoidance, and cooperation strategies

80. ____ occurs when managers choose an alternative that is good enough, rather than the best possible alternative. a. Maximizing b. Optimizing c. Alternating d. Budgeting e. Satisficing

e. Satisficing

69. According to social psychologist Kurt Lewin, _____ lead to differences in the form, quality, or condition of an organization over time. a. freezing forces b. resistance forces c. generational changes d. inertia forces e. change forces

e. change forces

61. In the _____ stage of organizational decline, a new CEO may be brought in to oversee the closing of stores, offices, and manufacturing facilities, the final layoff of managers and employees, and the sale of assets. a. crisis b. blinded c. inaction d. faulty action e. dissolution

e. dissolution

40. A ____ exists when there is a gap between a desired state (what managers want) and an existing state (the situation that the managers are facing). a. service gap b. benchmark c. condition of certainty d. minimum threshold e. problem

e. problem

49. The two general kinds of trade barriers are _____. a. government import standards and industry import standards b. qualitative and quantitative barriers c. voluntary and involuntary barriers d. nationalistic and geocentric barriers e. tariff barriers and nontariff barriers

e. tariff barriers and nontariff barriers

6. ​_____ occurs when you have an idea but have to wait to share it because someone else is already presenting an idea to the group. a. ​Dialectal inquiry b. ​Evaluation apprehension c. ​Brainstorming d. ​Maximizing e. ​Production blocking

e. ​Production blocking

72. A(n) ​_____ is a committee within a company that analyzes the company's own weaknesses to determine how competitors could exploit them for competitive advantage. a. ​core firm b. ​analyzer c. ​prospector d. ​strategic group e. ​shadow-strategy task force

e. ​shadow-strategy task force