Strategic Management Test 2
In the SPACE analysis, what does a (+6, +3) strategy profile portray? A) A strong industry position B) An unstable environment C) A stable environment D) A weak industry position E) A weak financial position
A) A strong industry position
The Boston Consulting Group (BCG) Matrix is designed specifically to enhance which type of firm's efforts to formulate strategies? A) Companies with more than one division B) Large companies C) Companies with annual sales greater than $1 million D) Companies with annual sales of less than $1 million E) All companies
A) Companies with more than one division
Today, boards of directors are composed mostly of A) outsiders. B) management. C) union members. D) company employees. E) past executives.
A) outsiders
Both the Internal-External (IE) and Boston Consulting Group (BCG) Matrices are called _________________ matrices. A) portfolio B) security C) strategy D) vector E) velocity
A) portfolio
All of the following are basic functions of marketing EXCEPT A) value chain analysis B) customer analysis C) product and service planning D) pricing E) distribution
A) value chain analysis
Life-directing attitudes that serve as behavioral guidelines are called A) values. B) rites. C) beliefs. D) metaphors. E) legends.
A) values
In the BCG Matrix, a division with a high relative market share position in a low-growth industry can be described as a A) Star B) Cash Cow C) Question Mark D) Dog E) Failure
B) Cash Cow
What type of strategies would you recommend when a firm's SPACE Matrix directional vector has the coordinates (-2, +3)? A) Aggressive B) Conservative C) Competitive D) Defensive E) Integrative
B) Conservative
______________ includes the set of shared values, beliefs, attitudes, customs, norms, rites, rituals, personalities, heroes, and heroines that describe a firm. A) Strategy B) Culture C) Mission D) Objectives E) QSPM
B) Culture
Strategy analysis and choice largely involves making ________ decisions based on ________ information. A) long-term; short-term B) subjective; objective C) short-term; long-term D) subjective; short-term E) objective; subjective
B) subjective; objective
Mergers and acquisitions are created for all of the following reasons EXCEPT to A) gain new technology B) reduce tax obligations C) gain economies of scale D) smooth out seasonal trends in sales E) shift company profits to the United States from countries with low corporate tax rates
E) shift company profits to the United States from countries with low corporate tax rates
Which ratio is calculated by dividing profits before interest and taxes by total interest charges? A) inventory turnover B) fixed assets turnover C) total assets turnover D) debt-to-equity ratio E) times-interest-earned ratio
E) times-interest-earned ratio
There were far more global mergers and acquisitions in 2014 than in any year since A) 2007. B) 1999. C) 1985. D) 1967. E) 1951.
A) 2007
Under which strategy would you offer products or services to a wide range of customers at the lowest price available on the market? A) Cost Leadership — Low Cost B) Cost Leadership — Best Value C) Focus — Low Cost D) Focus — Best Value E) Differentiation
A) Cost leadership - low cost
Which strategy seeks to increase market share for present products or services in present markets through greater marketing efforts? A) Market penetration B) Forward integration C) Market development D) Backward integration E) Product development
A) Market penetration
In which situation would horizontal integration be an especially effective strategy? A) When an organization can gain monopolistic characteristics in a particular area or region without being challenged by the federal government for "tending substantially" to reduce competition B) When an organization competes in a slowing industry C) When decreased economies of scale provide major competitive advantage D) When an organization has neither the capital nor human talent needed to successfully manage an expanded organization E) When competitors are succeeding due to managerial expertise or having particular resources an organization possesses
A) When an organization can gain monopolistic characteristics in a particular area or region without being challenged by the federal government for "tending substantially" to reduce competition
Amazon's start of rapid delivery services in some U.S. cities is an example of which type of strategy? A) Forward integration B) Backward integration C) Horizontal integration D) Related diversification E) Unrelated diversification
A) forward integration
The _____________ decision is the allocation and reallocation of capital and resources to projects, products, assets, and divisions of an organization. A) investment B) dividend C) financing D) restructuring E) benchmark
A) investment
What principle is based on the belief that the true measure of a really good strategist is the ability to solve problems? A) managing by crisis B) managing by objectives C) managing by extrapolation D) managing by exception E) managing by hope
A) managing by crisis
Pricing is one of the basic functions of _______________. A) marketing B) finance / accounting C) management information systems D) production / operations E) research and development
A) marketing
Which of the following does the text call an up-front investment in success? A) planning B) organizing C) motivating D) staffing E) controlling
A) planning
The Robinson-Patman Act affects a company's _______________. A) pricing B) product / service planning C) customer analysis D) marketing research E) distribution
A) pricing
What occurs when two or more companies for a temporary partnership or consortium for the purpose of capitalizing on some opportunity? A) Retrenchment B) A joint venture C) Liquidation D) Forward integration E) Divestiture
B) A joint venture
Which strategy should be implemented when a division is responsible for an organization's overall poor performance? A) Backward integration B) Divestiture C) Forward integration D) Cost leadership E) Related diversification
B) Divestiture
Which term refers to selling a division or part of an organization? A) Joint venture B) Divestiture C) Concentric diversification D) Liquidation E) Horizontal integration
B) Divestiture
Which of the following are NOT mentioned as an example of cultural products? A) Rites B) Emotions C) Rituals D) Sagas E) Symbols
B) Emotions
What category of ratios measures a firm's ability to meet its short-term obligations? A) Profitability B) Liquidity C) Leverage D) Activity E) Growth
B) Liquidity
When two organizations of about equal size unite to form one enterprise, which of these occurs? A) Hostile takeover B) Merger C) Acquisition D) Leveraged buyout E) Friendly takeover
B) Merger
Which strategy is appropriate when an organization competes in an industry characterized by rapid technological developments? A) Retrenchment B) Product development C) Backward integration D) Liquidation E) Market penetration
B) Product development
What is the term for a historical narrative describing the unique accomplishments of a group and its leaders? A) Rite B) Saga C) Story D) Myth E) Folktale
B) Saga
The process whereby a firm determines the costs associated with organizational activities from purchasing raw materials to manufacturing products to marketing those products is called A) The Resource-Based Approach B) Value Chain Analysis C) Strategic Cost Anlaysis D) The Internal Factor Evaluation Matrix E) Cost-Benefit Analysis
B) Value Chain Analysis
The times-interest-earned ratio would be classified as a(n) A) activity ratio B) leverage ratio C) profitability ratio D) liquidity ratio E) growth ratio
B) leverage ratio
Which of the following is the process of influencing people to accomplish specific objectives? A) staffing B) motivating C) planning D) controlling E) organizing
B) motivating
Which function of management includes areas such as job design, job specifications, job analysis, and unity of command? A) planning B) organizing C) motivating D) staffing E) controlling
B) organizing
If total fixed costs are $10,000, variable costs per unit are $5, and the price per unit is $15, what is the breakeven quantity? A) 500 B) 667 C) 1,000 D) 2,000 E) 5,000
C) 1,000
Which chapter of the bankruptcy code applies to municipalities? A) Chapter 7 B) Chapter 8 C) Chapter 9 D) Chapter 12 E) Chapter 13
C) Chapter 9
______________ exemplifies the complexity of relationships among the functional areas of business. A) Government auditing B) External auditing C) Financial ratio analysis D) Environmental scanning E) Distribution strategy
C) Financial ratio analysis
According to Porter, which strategy offers products or services to a niche group of customers at the lowest price available on the market? A) Cost Leadership - Low Cost B) Cost Leadership - Best Value C) Focus - Low Cost D) Focus - Best Value E) Differentiation
C) Focus - Low cost
Which strategy would be most appropriate when the distinctive competencies of two or more firms complement each other especially well? A) Conglomerate diversification B) Divestiture C) Joint venture D) Retrenchment E) Integration
C) Joint venture
What category of ratios includes return on total assets and return on stockholders' equity? A) Leverage B) Activity C) Profitability D) Growth E) Liquidity
C) Profitability
Who should perform an internal audit? A) A private auditing firm B) The organization's accounting department C) Representative managers and employees from throughout the firm D) A small team of top-level managers E) The chief executive officer
C) Representative managers and employees from throughout the firm
When the private equity (PE) firm Clayton, Dubilier & Rice bought David's Bridal from the PE firm Leonard Green and Partner LP this was an example of A) dividend recapitalization B) a joint venture C) a secondary buyout D) a leveraged buyout E) a merger
C) a secondary buyout
Which is NOT one of the four common approaches to determine R&D budget allocations? A) finance as many project proposals as possible B) budget for R&D about what competitors spend C) use a percentage-of-costs method D) decide how many successful new products are needed and work backwards to estimate the required R&D investment E) Use a percentage-of-sales-method
C) use a percentage-of-costs method
Forward integration and backward integration are sometimes collectively referred to as A) horizontal integration B) diversification C) vertical integration D) stuck-in-the-middle E) hierarchical integration
C) vertical integration
Distribution includes ________________. A) customer analysis B) pricing C) warehousing D) advertising E) test marketing
C) warehousing
Which of the following is noted in the text as a serious obstacle for many small business owners? A) A lack of business ethics B) An excess of employees and managerial staff C) A lack of experience in networking D) A lack of strategic-management knowledge E) Having too many suppliers
D) A lack of strategic-management knowledge
Proctor & Gamble's (P&G) sale of many of its brands in order to focus on its core brands is an example of which type of strategy? A) Related diversification B) Unrelated diversification C) Retrenchment D) Divestiture E) Liquidation
D) Divestiture
Gap's opening of its first five stores in China is an example of which type of strategy? A) Forward integration B) Backward integration C) Horizontal integration D) Market development E) Product development
D) Market development
Which strategy generally entails large research and development expenditures? A) Market penetration B) Retrenchment C) Forward integration D) Product development E) Divestiture
D) Product development
Which of the following is NOT a reason joint ventures fail? A) Managers who must collaborate daily in operating the venture are not involved in forming or shaping the venture. B) The venture may not be supported equally by both partners C) The venture may benefit the partnering companies but may not benefit the customers who then complain about poorer service or criticize the companies in other ways D) Venture risk was minimized E) The venture may begin to compete more with one of the partners than the other
D) Venture risk was minimized
___________ management deals with inputs, transformations, and outputs that vary across industries and markets A) marketing B) financial C) research and development D) production and operations E) information systems
D) production and operations
Staples 170 store closings in North America in 2014 is an example of A) divestiture. B) backward integration. C) liquidation. D) retrenchment. E) forward integration.
D) retrenchment
A standardized set of behaviors used to manage anxieties is called a A) folktale B) rite C) metaphor D) ritual E) value
D) ritual
Any object, act, event, quality, or relation used to convey meaning is known as a A) myth. B) rite. C) value. D) symbol. E) metaphor.
D) symbol
A pasta manufacturer's purchase of some pet food brands is an example of A) backward integration B) divestiture C) retrenchment D) unrelated diversification E) forward integration
D) unrelated diversification
Backward integration is effective in all of these cases EXCEPT A) when an organization competes in an industry that is growing rapidly B) when an organization has both capital and human resources to manage the new business of supplying its own raw materials C) when an organization needs to acquire a needed resource quickly D) When the advantages of stable prices are not particularly important E) When present suppliers have high profit margins
D) when the advantages of stable prices are not particularly important
For many firms a key decision with great bearing on Research and Development (R&D) spending is whether to be a "first mover" or a A) "first activator" B) "second mover" C) "average player" D) "tech leader" E) "later follower"
E) "late follower"
_____________ is a commonly used approach to determine R&D budget allocations A) financing as many project proposals as possible B) using a percentage-of-sales method C) budgeting for R&D about what competitors spend D) deciding how many successful new products are needed and working backward to estimate the required R&D investment E) All of the above
E) All of the above
Which of the following is NOT a key question that can reveal internal strengths and weaknesses regarding a firm's marketing function? A) Does the firm have an effective sales organization? B) Has the firm's market share been increasing? C) Are markets segmented effectively? D) Are the firm's products and services priced appropriately? E) Does the firm have good liquidity?
E) Does the firm have good liquidity?
What category of ratios measures how effectively a firm can maintain its economic position in the growth of the economy and industry? A) Profitability B) Liquidity C) Leverage D) Revenue Growth E) Growth
E) Growth
Which strategy would be effective when the stockholders of a firm can minimize their losses by selling the organization's assets? A) Integration B) Differentiation C) Diversification D) Cost leadership E) Liquidation
E) Liquidation
Which of the following is NOT a guideline for when an organization should use an unrelated diversification strategy? A) When revenues derived from an organization's current products or services would increase significantly by adding the new unrelated products B) When an organization's present channels of distribution can be used to market the new products to current customers C) When the new products have countercyclical sales patterns compared to an organization's present products D) When an organization competes in a highly competitive and/or a no-growth industry E) When existing markets for an organization's present products are not yet saturated
E) When existing markets for an organization's present products are not yet saturated
An effective information management system _____________ information in such a way that it answers important operating and strategic questions. A) collects B) codes C) stores D) synthesizes E) All of the above
E) all of the above
Firms located in which quadrant of the Grand Strategy Matrix are in an excellent strategic position? A) I B) II C) III D) IV E) V
A) I
Which stage of the strategy-formulation framework includes an IFE Matrix and the Competitive Profile Matrix? A) Input B) Matching C) Decision D) Penetration E) Research
A) Input
Which stage of the strategy-formulation framework includes the IFE Matrix? A) Input stage B) Analysis stage C) Matching stage D) Decision stage E) Output stage
A) Input stage
According to the Grand Strategy Matrix, which strategy is recommended for a firm with rapid market growth and a strong competitive position? A) Market penetration B) Unrelated diversification C) Joint venture D) Retrenchment E) Liquidation
A) Market penetration
In the Boston Consulting Group (BCG) Matrix, how would a division with a low relative market share position in a high growth industry be described? A) Question Mark B) Cash Cow C) Star D) Stuck-in-the-middle E) Dog
A) Question Mark
What are the two external dimensions of the SPACE Matrix? A) Stability position and industry position B) Stability position and competitive position C) Industry position and competitive position D) Competitive position and financial position E) Financial position and industry position
A) Stability position and industry position
In the BCG Matrix, when a division of an organization has a high relative market share and is in a fast-growing industry, it is called a A) Star B) Cash Cow C) Cat D) Question Mark E) Dog
A) Star
What term is defined as the product of multiplying the weights by the Attractiveness Scores in each row of the QSPM? A) Total Attractiveness Scores B) Sum Total Scores C) Weighted Scores D) Total Weighted Scores E) Factors
A) Total Attractiveness Scores
What kind of strategy is retrenchment? A) a turnaround strategy B) an expansion strategy C) a diagonal strategy D) an intensive strategy E) an offensive strategy
A) a turnaround strategy
According to Roger Schroeder, which basic function within production and operations deals with aggregate planning and scheduling? A) capacity B) inventory C) workforce D) process E) quality
A) capacity
The IFE Matrix should be ____________ in multidivisional firms A) constructed for each autonomous division B) all-inclusive C) constructed only for the major divisions D) developed before the EFE Matrix E) revised monthly
A) constructed for each autonomous division
______________ can reveal the demographic characteristics of an organization's customers. A) customer profiling B) test marketing C) market development D) the vision statement E) telemarketing
A) customer profiling
Organizational resources include all of the following EXCEPT A) employee training B) firm structure C) planning processes D) informational systems E) copyrights
A) employee training
For companies located in Quadrant III of the Grand Strategy Matrix, the first strategy recommended is A) extensive cost and asset reduction. B) asset expansion. C) employee expansion. D) immediate liquidation of assets. E) divestiture.
A) extensive cost and asset reduction
Successful strategies minimize their own political exposure on issues that are ____________ and in circumstances where opposition from major power centers is likely. A) highly controversial B) nominally controversial C) power centered D) strategy centered E) tactic optimized
A) highly controversial
All of the following situations are conducive to market development EXCEPT A) when new channels of distribution are expensive and unreliable B) when an organization is successful at what it does C) when new untapped or unsaturated markets exist D) when an organization has excess production capacity E) when an organization's basic industry is rapidly becoming global in scope
A) when new channels of distribution are expensive and unreliable
Although a firm positioned in Quadrant ________ of the Grand Strategy Matrix is in a growing industry, it is unable to compete effectively and needs to determine why the firm's current approach is ineffective and how to best change to improve competitiveness. A) I B) II C) III D) IV E) V
B) II
Which matrix is included in the decision stage of the strategy formulation framework? A) Internal Factor Evaluation Matrix B) Quantitative Strategic Planning Matrix C) Boston Consulting Group Matrix D) Grand Strategy Matrix E) Strategic Position and Action Evaluation Matrix
B) Quantitative Strategic Planning Matrix (QSPM)
Which strategies aim at improving internal weaknesses by taking advantage of external opportunities? A) SO B) WO C) SW D) ST E) WT
B) WO
Under which condition would a differentiation strategy be especially effective? A) When there are few ways to differentiate the product or service that buyers perceive as having value B) When technological change is fast paced and competition revolves around rapidly evolving product features C) When most buyers use the product in the same way D) When many rival firms are following a similar differentiation approach E) When the differentiation base is easy or inexpensive for rivals to duplicate
B) When technological change is fast paced and competition revolves around rapidly evolving product features
In the Boston Consulting Group (BCG) Matrix, which element represents the industry growth rate in sales, measured in percentage terms? A) X-axis B) Y-axis C) First quadrant D) Second quadrant E) Third quadrant
B) Y-axis
A firm's strengths that cannot be easily matched or imitated by competitors are called A) internal audits B) distinctive competencies C) external audits D) interrelated properties E) internal properties
B) distinctive competencies
An organization's present strategies, objectives, vision, and mission, coupled with the external and internal audit information, provide a basis for A) generating structural strategies, but not evaluating those strategies B) evaluating structural strategies, but not generating those strategies C) generating feasible alternative strategies, but not evaluating those strategies D) evaluating feasible alternative strategies, but not generating those strategies E) generating and evaluating feasible alternative strategies
B) evaluating structural strategies, but not generating those strategies
Financial objectives involve all of the following EXCEPT A) growth in revenues B) larger market share C) higher dividends D) greater return on investment E) a rising stock price
B) larger market share
Which function of management is concerned with span of control and chain of command? A) planning B) organizing C) controlling D) staffing E) motivating
B) organizing
When companies are hired by other companies to take over functional operations such as human resources, information systems, payroll, accounting, or customer service, this is called A) marketing B) outsourcing C) licensing D) franchising E) divestiture
B) outsourcing
What is the essential bridge between the present and the future that increases the likelihood of achieving desired results? A) motivating B) planning C) controlling D) staffing E) organizing
B) planning
Which strategy is effective when new, but related, products could be offered at highly competitive prices? A) forward integration B) related diversification C) related integration D) conglomerate diversification E) unrelated diversification
B) related diversification
Which strategy should an organization use when its products are currently in the declining stage of the product's life cycle? A) divestiture B) related diversification C) backward integration D) unrelated diversification E) retrenchment
B) related diversification
An effective way to gain commitment and achieve desired results is to A) emphasize that imposing a particular method is more important than achieving desired results B) shift from specific to general issues and concerns C) eliminate middle level managers from strategic decisions D) switch from long-term to short-term issues and concerns E) realize that it's better to achieve optimal results with an unpopular strategy than to achieve satisfactory results with a popular strategy
B) shift from specific to general issues and concerns
Metaphors are A) several rites connected together B) shorthand of words used to capture a vision or to reinforce old or new values C) narratives based on true events D) fictional stories E) any objects, acts, events, qualities, or relations used to convey meaning
B) shorthand of words used to capture a vision or to reinforce old or new values
All of the following are limitations of the Boston Consulting Group (BCG) Matrix EXCEPT A) viewing every business as a star, cash cow, dog or question mark can be an oversimplification B) the matrix requires at least three years worth of data C) the matrix does not reflect divisional or industry growth over time D) the matrix does not allow a company to be classified as somewhere in between two categories E) variables such as size of market and competitive advantages are not considered in the Matrix
B) the matrix requires at least three years worth of data
_______________ is the unique way an organization does business. A) Attitude B) Belief System C) Culture D) Demographics E) Strategy
C) Culture
The two positive-rated dimensions on the SPACE Matrix are A) FP and CP B) CP and SP C) FP and IP D) IP and SP E) FP and SP
C) FP and IP
Which of the following is a limitation associated with a SWOT Matrix? A) Viewing every business as a Star, Cash Cow, Dog, or Question Mark is an oversimplification B) Many businesses fall right in the middle of the matrix C) It is a static assessment in time D) Other variables besides relative market share position and industry growth rate in sales need to be considered E) The matrix does not reflect whether or not divisions or their industry are growing over time
C) It is a static assessment in time
Which of these is a limitation of QSPM? A) Only a few strategies can be evaluated at once. B) It is prohibitively expensive C) It requires intuitive informed judgments D) Strategies cannot be examined sequentially E) It makes it more likely that key factors will be overlooked or weighted inappropriately
C) It requires intuitive informed judgments
Which strategy-formulation technique reveals the relative attractiveness of alternative strategies and thus provides an objective basis for selecting specific strategies? A) Strengths-Weaknesses-Opportunities-Threats (SWOT) Matrix B) Strategic Position and Action Evaluation (SPACE) Matrix C) Quantitative Strategic Planning Matrix (QSPM) D) Internal-External (IE) Matrix E) Grand Strategy Matrix
C) Quantitative Strategic Planning Matrix (QSPM)
Which board of director's duty falls under the category of control and oversight over management? A) Select new directors B) Pass bylaws and related resolutions C) Select the CEO D) Maintain good public image E) Ensure equitable stockholder representation
C) Select the CEO
Which stage of the strategy-formulation framework involves the Quantitative Strategic Planning Matrix? A) Stage 1 B) Stage 2 C) Stage 3 D) Stage 4 E) Stage 5
C) Stage 3
Staffing involves all of these activities EXCEPT A) recruiting employees B) rewarding employees C) analyzing customers D) managing union relations E) training and developing employees
C) analyzing customers
Which ratio would be considered an activity ratio? A) debt-to-equity B) net profit margin C) average collection period D) earnings per share E) current ratio
C) average collection period
Bankruptcy A) should never be used as a strategy. B) should be used only when one is legally forced to do so. C) can be an effective type of retrenchment strategy. D) should only be used for large firms. E) should only be used for small, private firms.
C) can be an effective type of retrenchment strategy
All of the following are basic activities of management EXCEPT A) staffing B) planning C) consolidating D) organizing E) motivating
C) consolidating
Selling includes all of these marketing activities EXCEPT A) advertising. B) dealer relations. C) customer analysis. D) publicity. E) sales promotion.
C) customer analysis
Which level of strategy is most likely NOT present in small firms? A) company B) functional C) divisional D) operational E) all of the above are present in small firms
C) divisional
Which of the three finance and accounting decisions involves determining the best capital structure for the firm? A) Investment B) Dividend C) Financing D) Capital budgeting E) Implementation
C) financing
Websites that sell products directly to consumers are examples of which type of strategy? A) Backward integration B) Product development C) Forward integration D) Horizontal integration E) Conglomerate diversification
C) forward integration
_____________ ties all business functions together and provides the basis for all managerial decisions. A) management B) marketing C) information D) technology E) workforce
C) information
Retrenchment would be an effective strategy when an organization A) has shrunk so quickly that major internal reorganization is needed. B) is one of the stronger competitors in a given industry. C) is plagued by inefficiency, low profitability, poor employee morale and pressure from stockholders to improve performance. D) has decided to capitalize on opportunities, maximize threats, take advantage of strengths and overcome weaknesses. E) does not have a clearly distinctive competence and has failed to meet its objectives and goals consistently over time.
C) is plagued by inefficiency, low profitability, poor employee morale and pressure from stockholders to improve performance
Which of the following is the first step in developing an IFE matrix? A) determining the organization's structure B) summing the weighted scores for each variable C) listing key internal strengths and weaknesses D) identifying the organization's functions of business E) assigning a weight to each factor
C) listing key internal strengths and weaknesses
The three all-encompassing internal resource categories used in the resource-based view are physical resources, human resources and _______. A) financial resources B) shareholder resources C) organizational resources D) non-renewable resources E) technological resources
C) organizational resources
Which management function includes breaking tasks into jobs, combining jobs to form departments, and delegating authority? A) motivating B) staffing C) organizing D) controlling E) planning
C) organizing
The match an organization makes between its internal resources and skills and the opportunities and risks created by its external factors can be defined as A) input. B) concept formulation. C) strategy. D) SWOT. E) weakness.
C) strategy
The top row of a Quantitative Strategic Planning Matrix (QSPM) consists of alternative strategies derived from all of the following EXCEPT A) Grand Strategy Matrix B) Boston Consulting Group (BCG) Matrix C) Strategic Position and Action Evaluation (SPACE) Matrix D) Competitive Profile Matrix (CPM) E) Internal-External (IE) Matrix
D) Competitive Profile Matrix (CPM)
What analytical tool has four quadrants based on two dimensions: competitive position and market growth? A) Competitive Profile Matrix (CPM) B) Internal-External (IE) Matrix C) Strategic Position and Action Evaluation (SPACE) Matrix D) Grand Strategy Matrix E) Quantitative Strategic Planning Matrix (QSPM)
D) Grand Strategy Matrix
According to the Grand Strategy Matrix, organizations in which quadrant have a strong competitive position but are in a slow-growth industry? A) I B) II C) III D) IV E) V
D) IV
Which of the following is NOT one of the steps involved in constructing a SWOT Matrix? A) List the firm's key external threats B) Match internal strengths with external opportunities, and record the resultant SO strategies in the appropriate cell C) Match internal strengths with external threats, and record the resultant ST strategies D) List the firm's external weaknesses E) List the firm's external opportunities
D) List the firm's external weaknesses
Which of these is NOT a SPACE Matrix quadrant? A) Aggressive B) Defensive C) Competitive D) Offensive E) Conservative
D) Offensive
In the Boston Consulting Group (BCG) Matrix, which strategy would be most appropriate for a division classified as a Dog? A) Market penetration B) Market development C) Product development D) Retrenchment E) Forward integration
D) Retrenchment
Long-term objectives are needed at which level(s) in an organization? A) Corporate B) Divisional C) Functional D) All of the above E) Corporate & divisional levels, but not functional level
D) all of the above
All of the following are principles of good organizational governance, as established by BusinessWeek EXCEPT A) each director attends at least 75 percent of all meetings B) the audit, compensation and nominating committees are made up solely of outside directors C) each director owns a large equity stake in the company D) at least three directors are current or former company executives E) the CEO is not also the Chairperson of the Board
D) at least three directors are current or former company executives
Which of these strategies is effective when the number of suppliers is small and the number of competitors is large? A) Conglomerate diversification B) Forward integration C) Concentric diversification D) Backward integration E) Horizontal diversification
D) backward integration
The two internal dimensions represented on the axes of the SPACE Matrix are A) stability position and industry position. B) industry position and internationalization. C) internationalization and competitive position. D) competitive position and financial position. E) financial position and stability position.
D) competitive position and financial position
The controversial practice of a company borrowing money simply to fund dividend payouts to itself is known as A) a leveraged buyout B) retrenchment C) first mover advantage D) dividend recapitalization E) dividend divestiture
D) dividend recapitalization
What refers to a strategy of seeking ownership of, or increased control over a firm's competitors? A) Forward integration B) Conglomerate diversification C) Backward integration D) Horizontal integration E) Concentric diversification
D) horizontal integration
Selling all of a company's assets, in parts, for their tangible worth is called A) joint venture. B) divestiture. C) concentric diversification. D) liquidation. E) unrelated integration.
D) liquidation
A resource is valuable if it is rare, hard to imitate, or __________. A) expensive B) inexpensive C) easily substitutable D) not easily substitutable E) inefficient
D) not easily substitutable
In most industries, the major costs of producing a product or service are incurred within A) marketing B) management C) research and development D) operations E) management information systems
D) operations
The pattern of behavior developed by an organization as it learns to cope with its problems of external adaptation and internal integration, that has worked well enough to be considered valid and to be taught to new members as the correct way to perceive, think, and feel is called A) dysfunctional behavior B) groupthink C) behavior modification D) organizational culture E) internal audit effect
D) organization culture
What marketing function includes test marketing? A) selling products and services B) pricing C) customer analysis D) product and service planning E) distribution
D) product and service planning
Which of the following analytical tools consists of a nine-cell matrix? A) Boston Consulting Group (BCG) Matrix B) Competitive Profile Matrix (CPM) C) Strategic Position and Action Evaluation (SPACE) Matrix D) Grand Strategy Matrix E) Internal-External (IE) Matrix
E) Internal-External (IE) Matrix
Which of the following is the first step in developing a QSPM? A) Compute the Total Attractiveness Scores B) Examine the Stage 2 matrices and identify alternative strategies the organization should consider implementing C) Assign weights to each key external and internal factor D) Determine the Attractiveness Scores E) Make a list of the firm's key external opportunities and threats and internal strengths and weaknesses in the left column of the QSPM
E) Make a list of the firm's key external opportunities and threats and internal strengths and weaknesses in the left column of the QSPM
All of the following are cooperative arrangements EXCEPT A) Research and Development (R&D) partnerships B) Joint-bidding consortia C) Cross-licensing agreements D) Cross-manufacturing agreements E) Marketing plans
E) Marketing plans
Which stage in the strategy-formulation framework focuses on generating feasible alternative strategies? A) Input B) Output C) Decision D) Throughput E) Matching
E) Matching
How many cells are in a SWOT Matrix? A) Two B) Four C) Six D) Eight E) Nine
E) Nine
Which analytical tool determines the relative attractiveness of various strategies based on the extent to which key external and internal critical success factors are capitalized upon or improved? A) Boston Consulting Group (BCG) Matrix B) Strategic Position Competitive Profile Matrix (CPM) C) Strengths-Weaknesses-Opportunities-Threats (SWOT) Matrix D) Internal-External (IE) Matrix E) Quantitative Strategic Planning Matrix (QSPM)
E) Quantitative Strategic Planning Matrix (QSPM)
Forward integration would be an appropriate strategy for which of the following types of divisions in the Boston Consulting Group (BCG) Matrix? A) Dogs B) Failures C) Question Marks D) Cat E) Star
E) Star
Which section of the SWOT Matrix involves matching internal strengths with external opportunities? A) The WT cell B) The SW cell C) The WO cell D) The ST cell E) The SO cell
E) The SO cell
What is the highest number of strategies that can be examined at one time with the QSPM? A) 1 B) 2 C) 5 D) 10 E) There is no limit.
E) There is no limit
Which strategies are defensive tactics directed at reducing internal weaknesses and avoiding external threats? A) SO B) WO C) SW D) ST E) WT
E) WT
Under which condition would a cost leadership strategy be especially effective? A) When there are many ways to achieve product differentiation that have value to buyers B) When most buyers use the product in different ways C) When buyers incur high costs in switching their purchases from one seller to another D) When buyers are small and have little power to bargain down prices E) When the products of rival sellers are essentially identical and supplies are readily available from any of several eager sellers
E) When the products of rival sellers are essentially identical and supplies are readily available from any of several eager sellers
Synergy A) is the 2+2 = 5 effect B) can result in powerful competitive advantages C) can be developed by an organization through planning D) exists when everyone pulls together as a team that knows what it wants to achieve E) all of the above
E) all of the above
Which function of management includes all of those activities undertaken to ensure actual operations conform to planned operations? A) planning B) organizing C) motivating D) staffing E) controlling
E) controlling
The initial step to implementing value chain analysis is A) attaching a cost to each discrete activity B) establishing costs in terms of time C) establishing costs in terms of money D) converting the cost data into information by looking for competitive cost strengths and weaknesses E) dividing a firm's operations into specific activities or business processes
E) dividing a firm's operations into specific activities or business processes
The act of oversight and direction for an organization is referred to as A) corporate lawmaking. B) centralized control. C) organizational direction. D) establishing norms. E) governance.
E) governance
What principle is built on the idea that there is no general plan for which way to go and what to do? A) managing by crisis B) managing by extrapolation C) managing by objectives D) managing by hope E) managing by subjectives
E) managing by subjectives
When a domestic company first begins to export to India, it is an example of A) horizontal integration B) backward integration C) forward integration D) concentric diversification E) market development
E) market development
Yum brand owns A) none of its outside-U.S. restaurants B) a small share of its outside-U.S. restaurants C) nearly half of its outside-U.S. restaurants D) a substantial majority of its outside-U.S. restaurants E) virtually all of its outside-U.S. restaurants
E) virtually all of its outside-U.S. restaurants