4490 chapter nine quiz

Which of the following is an example of explicit knowledge? 1) the creative ability of a manager to recognize potential business opportunities 2) the findings of a research published in a scientific journal 3) the decision-making capability that is intrinsic to an employee 4) the entrepreneurial skills of a manager

2) the findings of a research published in a scientific journal

A non-equity alliance is the most common type of strategic alliance because: 1) it is easy to initiate and terminate. 2) it produces the strongest ties between alliance partners. 3)it is based on partial ownership. 4) it is least flexible.

1) it is easy to initiate and terminate.

The management at Torque Autos Inc. and RedWing Automobiles Inc. realized that by combining the two entities the stakeholders of both the companies would benefit. Their core competencies would act as complementary assets to each other. Consequently, RedWing Automobiles joined together with Torque Autos to form a combined entity called TorqueWing Autos Inc. Which form of strategic alliance does this scenario best illustrate? 1) a hostile takeover 2) a merger 3) a franchisee arrangement 4) a cartel

2) a merger The scenario best illustrates a merger. A merger describes the joining of two independent companies to form a combined entity. Mergers tend to be friendly; in mergers, the target firm would like to be acquired.

Which of the following best illustrates horizontal integration? 1) Ignited Autos Inc. sets up its own component-part manufacturing units to have strong control over production. 2) Skin Love Inc. sets up its own retail stores to directly sell its products, rather than selling them through large departmental stores. 3) B9 Electronics Inc. acquires its competitor, Virtue Electronics Inc., to gain access to its core competencies. 4) Polka Couture Inc. outsources its production to contract manufacturers in labor-intensive countries.

3) B9 Electronics Inc. acquires its competitor, Virtue Electronics Inc., to gain access to its core competencies.

________ is best described as the process of merging with a competitor at the same stage of the value chain. 1) Backward integration 2) Forward integration 3) Horizontal integration 4) Taper integration

3) Horizontal integration

Which of the following best illustrates a strategic alliance? 1) PT Group Inc., a large conglomerate, taking over a startup company against its will 2) the electronics subsidiary unit of Westmans Inc. deploying a few of its human resources to the automobile subsidiary of the company 3) Jupiter Pharma Inc. teaming up with a research company to invent and market breakthrough vaccines 4)Saucy Apparel Inc. taking over one of its fabric suppliers in a less developed nation

3) Jupiter Pharma Inc. teaming up with a research company to invent and market breakthrough vaccines

Which of the following statements is true of the real-options perspective? 1) The approach obligates the incumbent firm to make continued investments when demanded by its partner. 2)The approach fails to provide the incumbent firm a hedge against uncertainty. 3) The approach involves making large investments at the end of a project, irrespective of whether the project is successful or not. 4) The approach allows the incumbent firm to obtain additional information at predetermined stages.

4) The approach allows the incumbent firm to obtain additional information at predetermined stages.

What happens in the third phase of alliance management? 1) the alliance partners choose an appropriate governance mechanism 2) the incumbent firm designs the alliance 3)the firm initiating the alliance selects its partner 4) the alliance partners make relation-specific investments

4) the alliance partners make relation-specific investments

Which of the following is one of the reasons that firms make acquisitions? 1) to shift the industry structure from oligopoly to perfect competition 2) to move up a learning curve 3) to standardize their product and service offerings and reduce the levels of differentiation 4)to gain access to a new capability or competency

4)to gain access to a new capability or competency Firms make acquisitions for two main reasons: to gain access to a new capability or competency, and to preempt rivals.

Which of the following is one of the primary reasons behind the merger between Adidas and Reebok? 1) to reduce the levels of differentiation 2) to gain competitive advantage 3) to gain the advantages of vertical integration 4)to overcome a competitive disadvantage

4)to overcome a competitive disadvantage Adidas acquired Reebok in order to compete more effectively with Nike. This acquisition allowed the now-larger Adidas group to benefit from economies of scale and scope that were unachievable when Adidas and Reebok operated independently.