BUS 450 5

hat strategy seeks to increase market share for present products or services in present markets through greater marketing​ efforts? A. Forward integration B. Reshoring C. Market saturation D. Market penetration E. Market development

Market penetration

Which of the following is a condition that leads firms to​ "borrow" capabilities through joint ventures or strategic​ alliances? A. The firm aims to grow organically. B. The costs and risks of merging are too high. C. There is little risk to merging. D. The firm wishes to grow by acquiring another firm. E. The firm can develop the necessary resources internally.

The costs and risks of merging are too high.

Amazon.com is planning to enter the​ $412 billion pharmacy business. Which type of diversification does this​ represent? A. Divestiture B. Market penetration C. Market development D. Related diversification E. Unrelated diversification

Unrelated diversification

The two general types of diversification strategies are related diversification and unrelated diversification. When are businesses said to be​ related? A. When their value chains possess competitively valuable​ cross-business strategic fits B. When they compete in about the same areas C. When they are about the same size D. When their objectives and strategies are about the same E. When they compete in the same SIC code industry

When their value chains possess competitively valuable​ cross-business strategic fits

Divestiture could be an effective strategy under which of the following​ conditions? A. The organization is not willing to try a retrenchment strategy first. B. The organization has a large amount of cash that is readily available. C. There is no threat of government antitrust actions. D. A division is responsible for an​ organization's overall poor performance. E. The organization has engaged in a successful retrenchment strategy.

A division is responsible for an​ organization's overall poor performance.

Secondary buyouts occur when what​ happens? A. A company buys a firm and then sells the firm within a year B. A private equity firm buys a privately held firm C. A private equity firm buys a publically held firm D. A private equity firm buys a firm from another private equity firm E. A company buys a firm and then itself is purchased by another company

A private equity firm buys a firm from another private equity firm

What are two major types of​ bankruptcy? A. Chapters 7 and 11 B. Chapters 3 and 11 C. Chapters 3 and 9 D. Chapters 2 and 4 E. Chapters 5 and 15

Chapters 7 and 11

Which of the following is NOT a benefit of establishing clear​ objectives? A. Clear objectives minimize conflict. B. Clear objectives aid in allocation of resources. C. Clear objectives reduce uncertainty. D. Clear objectives allow synergy. E. Clear objectives provide the basis for creativity.

Clear objectives provide the basis for creativity.

According to Michael​ Porter, strategies allow organizations to gain competitive advantage from two different bases. What are the​ bases? A. Cost leadership and differentiation B. Cost containment and price C. Value and procurement D. Price and Quality E. Differentiation and quality

Cost leadership and differentiation

According to​ Porter, strategies allow organizations to gain competitive advantage from two different bases. What are the​ bases? A. Cost leadership and differentiation B. Initiator and differentiation C. Being a​ first-mover, being a​ late-follower, and differentiation D. Cost leadership and initiator E. Differentiation and being a​ first-mover

Cost leadership and differentiation

The Global Capsule in Chapter 5 says perhaps the best variable to monitor and to use to decide where to begin doing business is what​ factor? A. Gross Domestic Product B. Interest rates C. Population growth D. Internet penetration E. National crime rate

Gross Domestic Product

The chapter lists six reasons why many mergers and acquisitions​ fail, including which of the​ following? A. Inability to achieve synergy B. Lack of diversitures C. Lack of reengineering D. Lack of reshoring E. Too small an acquisition

Inability to achieve synergy

______ is a popular strategy that occurs when two or more companies form a temporary partnership or consortium for the purpose of capitalizing on some opportunity. A. Alliancing B. Coordinating C. Joint alliance D. Joint venture E. Combining

Joint venture

When an organization has pursued both a retrenchment strategy and a divestiture strategy and neither has been​ successful, then perhaps the best strategy is​ ______. A. Chapter 8 bankruptcy B. Chapter 9 bankruptcy C. Liquidation D. Restructuring E. Discontinuation

Liquidation

The old​ adage, "If it​ ain't broke,​ don't fix​ it" pertains to which of the​ following? A. Managing by hope B. Managing by subjectives C. Managing by continuity D. Managing by crisis E. Managing by extrapolation

Managing by extrapolation

Which of the following is a good guideline for indicating when market development may be an especially effective​ strategy? A. New channels of distribution are available that are​ reliable, inexpensive, and of good quality. B. Unsaturated markets do not exist. C. The organization does not have the capital needed to manage expanded operations. D. The organization is not good at what it does. E. The organization does not have the human resources needed to manage expanded operations.

New channels of distribution are available that are​ reliable, inexpensive, and of good quality.

What is the name of the strategy that involves selling off land and buildings to raise needed​ cash, pruning product​ lines, closing marginal​ businesses, closing obsolete​ factories, automating​ processes, reducing the number of​ employees, and instituting expense control​ systems? A. Reshoring B. Bankruptcy C. Divestiture D. Reengineering E. Retrenchment

Retrenchment

Which of the following is NOT a benefit of being a first​ mover? A. Build customer loyalty B. Acquire new knowledge of critical success factors C. Secure access to widely available resources D. Obtain early patent protection E. Gain market share in the best locations

Secure access to widely available resources

Which of the following is NOT a risk of pursuing a cost leadership​ strategy? A. Competitors may imitate the strategy. B. Overall industry profits may be driven down. C. Buyer interest may swing to other differentiating features. D. Technological breakthroughs may make the strategy ineffective. E. The unique product may not be valued highly enough by customers to justify the higher price.

The unique product may not be valued highly enough by customers to justify the higher price.

What is the difference between the Type 3 and Type 4 levels of a differentiation​ strategy? A. Type 3 is used for domestic markets and Type 4 is used for global markets. B. Type 3 has a narrow target market and Type 4 has a broad target market. C. Type 3 has a broad target market and Type 4 has a narrow target market. D. Type 3 is a strategy unique to the firm while Type 4 copies​ competitor's strategies. E. Type 3 is an outdated strategy which has been replaced by Type 4.

Type 3 has a broad target market and Type 4 has a narrow target market.

What strategy may be best under the following​ conditions? bullet• The organization competes in a highly competitive or a​ no-growth industry, as indicated by low industry profit margins and returns. bullet• The​ organization's present channels of distribution can be used to market new products to current customers. bullet• New products have countercyclical sales patterns compared with an​ organization's present products. bullet• The​ organization's basic industry is experiencing declining annual sales and profits. A. Vertical integration B. Retrenchment C. Divestiture D. Unrelated diversification E. Related diversification

Unrelated diversification

Which of the following statements is​ FALSE? A. In a global market tied together by the​ Internet, joint​ ventures, and​ partnerships, alliances are proving to be a more effective way to enhance corporate growth than mergers and acquisitions. B. Partnering is not yet taught at most business schools and is often viewed within companies as a financial issue rather than a strategic issue C. Partnering has become a core​ competency, a strategic issue of high importance. D. Value chain analysis and benchmarking are opposite ways to address the management of resources. E. Although evidence is mounting that firms should use partnering as a means for achieving​ strategies, most U.S. firms in many industrieslong dash—such as financial​ services, forest​ products, metals, and retailinglong dash—still operate in a merge or acquire mode to obtain growth.

Value chain analysis and benchmarking are opposite ways to address the management of resources.

Related diversification may be an effective strategy when​ ______. A. new but related products do not counterbalance an​ organization's existing peaks and valleys B. an organization competes in a​ no-growth or​ slow-growth industry C. new but related products could not be offered at competitive prices D. an organization has a weak management team E. an​ organization's products are in a growth stage

an organization competes in a​ no-growth or​ slow-growth industry

An effective means of implementing forward integration is​ ______. A. product development. B. unrelated diversification. C. liquidation. D. franchising. E. divestiture.

franchising.

VCA is the process whereby a firm determines the value​ (price minus​ cost) of each and all activities​ ______. A. performed by suppliers and distributors B. performed by managers C. performed by employees D. performed within all organizational levels of the firm E. that went into producing and marketing a product

that went into producing and marketing a product

Which of the following are the 5 characteristics of​ objectives? A. ​quantitative, understandable,​ realistic, compatible, obtainable B. ​quantitative, understandable,​ challenging, compatible, obtainable C. ​quantitative, understandable,​ challenging, compatible, qualitative D. ​qualitative, understandable,​ challenging, compatible, obtainable E. ​quantitative, understandable,​ challenging, clear, obtainable

​quantitative, understandable,​ challenging, compatible, obtainable

Which of the following is a guideline for indicating that product development may be an effective​ strategy? A. An organization has many successful new products. B. The organization is weak at research and development. C. Major competitors offer​ better-quality products at lower prices. D. The​ organization's industry is stable with slow changes in technology. E. An organization competes in a​ high-growth industry.

An organization competes in a​ high-growth industry.

If an​ organization's present suppliers are especially​ expensive, unreliable, or incapable of meeting the​ firm's needs for​ parts, components,​ assemblies, or raw​ materials, what strategy is​ best? A. Divestiture B. Backward integration C. Horizontal diversification D. Market development E. Vertical integration

Backward integration

​Boeing's decision to build​ 80% of its wing flap motors​ in-house is an example of which​ strategy? A. Backward integration B. Unrelated diversification C. Market penetration D. Product development E. Forward integration

Backward integration

What type of strategy aims to target a new market where competition is not yet present instead of going where many firms are already competing on price and the gains of one firm are often at the expense of​ another? A. Open ocean B. Blue river C. Red river D. Red ocean E. Blue ocean

Blue ocean

When a core competence evolves into a major competitive​ advantage, what is it​ called? A. Empirical indicator B. Distinctive competence C. Strength D. Objective achieved E. Mission accomplished

Distinctive competence

The largest​ consumer-products company in the​ world, Procter​ & Gamble​ (P&G), is in the process of selling more than half of its brands​ (nearly 100) in order to focus on its core brands​ (about 80). What is this strategy​ called? A. Declassification B. Divestiture C. Bankruptcy D. Retrenchment E. Reengineering

Divestiture

When a firm sells a division of the​ organization, it is utilizing which​ strategy? A. Backward integration B. Liquidation C. Horizontal integration D. Retrenchment E. Divestiture

Divestiture

Nonprofit organizations are basically just like​ for-profit companies except for two major differences. What is one of the​ differences? A. Nonprofits have no net income or retained earnings. B. Nonprofits do not pay taxes or have shareholders. C. Nonprofits do not have shareholders to provide capital. D. Nonprofits do no benchmarking or reshoring. E. Nonprofits have no cash budgets or financial statements.

Nonprofits do not pay taxes or have shareholders.

Backward integration can be an especially effective strategy under which of the following​ conditions? A. The number of competitors is small and the number of suppliers is large. B. The number of suppliers is small and the number of competitors is large. C. The organization competes in a mature industry that is not growing. D. Present suppliers have low​ profit-margins. E. Stable prices of raw materials is not a concern

The number of suppliers is small and the number of competitors is large.

Retrenchment may be an especially effective strategy to pursue under which of the following​ conditions? A. The organization has​ high-profitability. B. The organization is being pressured by stockholders to improve performance. C. The organization is successfully managing its growth. D. The organization is efficient. E. Employee morale is high.

The organization is being pressured by stockholders to improve performance.

Which of the following is a reason for a firm to initiate a leveraged buyout​ (LBO)? A. To form a joint venture B. To pursue organic growth C. To avoid a hostile takeover D. To convert a private company into a public company E. To pursue a Blue Ocean Strategy

To avoid a hostile takeover

To examine the value chain activities across an industry to determine​ "best practices" among competing​ firms, an organization would use an analytic tool known as​ ______. A. value chain analysis B. benchmarking C. retrenchment D. competitor analysis E. cost analysis

benchmarking

First mover advantages refers to the benefits a firm may achieve by entering a new market or developing a new product or service prior to rival firms. An advantage of being a first mover is​ ______. A. reengineering B. reshoring C. carving out market share and a position that is easy to defend and costly for rival firms to overtake D. benchmarking E. retrenchment

carving out market share and a position that is easy to defend and costly for rival firms to overtake

Firms should use Value Chain Analysis​ (VCA) to develop and nurture a​ ______ competence and convert that into a distinctive competence. A. competitive B. core C. tangential D. profitable E. unique

core

When an organization splits into two or more​ parts, this type of strategy is a​ _____. A. ​de-integration B. splitation C. liquidation D. retrenchment E. divestiture

divestiture

Being​ a(n) _______ can be an effective strategy in industries where technology is rapidly advancing. A. middle mover B. first mover C. slow follower D. fast follower E. early mover

fast follower

For nonprofit and governmental​ organizations, strategic management is an important means to develop and justify requests for needed​ ______. A. tax reductions B. financial support C. mergers and acquisitions D. investment from shareholders E. ​first-mover initiatives

financial support

Gaining ownership or increased control over distributors or retailers is called​ _____. A. forward integration B. market development C. vertical integration D. backward integration E. market penetration

forward integration

Research indicates that strategic management in small firms is most likely​ ______. A. always the same as large firms B. less formal than in large firms. Your answer is correct. C. not as vital as it is for large firms D. not related to performance E. more formal than in large firms

less formal than in large firms.

The time frame for​ long-term objectives and strategies should be​ consistent, usually from​ ______ to​ ______ years. A. ​2; 5 B. ​1; 10 C. ​2; 10 D. ​1; 15 E. ​1; 5

​2; 5

Objectives should include which of the following​ characteristics? A. ​Measurable, realistic, and holistic B. ​Measurable, challenging, and hierarchical C. ​Qualitative, obtainable, congruent among organizational​ units, and associated with a timeline D. Divisional and actionable E. Qualitative and actionable

​Measurable, challenging, and hierarchical