Chapter 4 Quiz

Which statement below is​ FALSE?

***A. Companies should pay dividends regardless of changes in their revenue.*** B. Dividends are sometimes paid out even if the funds could be better reinvested in the​ business, and/or even if the firm has to obtain outside sources of capital to pay for the dividends. C. The benefits of paying dividends to investors must be balanced against the benefits of internally retaining​ funds, and there is no set formula on how to balance this​ trade-off. D. Companies today are aggressively boosting their dividends paid to shareholders. E. Dividends are sometimes paid out even when the firm has incurred a negative annual net income.

In developing an IFE​ Matrix, what is an important​ guideline?

Include factors that are​ actionable, quantitative,​ comparative, and divisional​ (AQCD) to the extent possible.

Lorsch found that executives in successful companies are emotionally committed to the​ firm's culture, but he concluded that culture can inhibit strategic management in the following​ way:

Managers frequently miss the significance of changing external conditions because they are blinded by strongly held beliefs.

The basic activities that comprise marketing include the​ following:

Marketing research and target market analysis

In developing an IFE​ Matrix, when can both internal and external factors be​ included?

Never

​______ is the process by which a person determines whether to attempt a​ task, works out the most effective way of reaching desired​ objectives, and prepares to overcome unexpected difficulties with adequate resources.

Planning

In developing an IFE​ Matrix, do not allow more than 30 percent of the key factors to be financial ratios.​ Why?

Since financial ratios are generally the result of many​ factors, knowing what particular strategies should be considered based on financial ratios is difficult.

According to James Van​ Horne, the basic activities of​ finance/accounting consist of three decisions. What are the​ three?

The investment​ decision, the financing​ decision, and the dividend decision

To the extent​ possible, internal​ strength/weakness factors should meet the four AQCD criteria. Two of these criteria are​ _____.

actionable and comparative

Empirical​ indicators, or characteristics of resources that enable a firm to implement​ strategies, include​ ______.

not easily substitutable

Target recently joined Best Buy in offering to match online prices of rival retailers. Both companies are seeking to combat​ ______ by shoppers who check out products in their stores but buy them on​ rival's websites.

showrooming

In​ 2018, global data analytics software is expected to reach​ ______ billion, a​ ______ percent increase from 2012.

​$21.7; 64

Human resource​ (HR) management includes activities such​ as:

​Disciplining, promoting,​ transferring, and demoting

What are the four basic activities that comprise​ management?

​Planning, organizing,​ leading, and controlling NOT CORRECT?

In an IFE​ Matrix, the weights of all factors included must add up to​ ______.

1.0

Spending on digital advertising recently surpassed television advertising and is expected to reach nearly​ ______ billion dollars in 2020.

380

In an IFE​ Matrix, how much more important is a weight of 0.16 than a weight of​ 0.07?

90% NOT CORRECT

Which of the following statements is​ TRUE?

A. If a firm possesses many​ highly-weighted weaknesses, this is likely the result of effective​ strategies, so higher ratings in general are warranted for strengths. B. If a firm possesses many​ highly-weighted weaknesses, this is likely the result of effective​ strategies, so higher ratings in general are warranted for both strengths and weaknesses. ***C. If a firm possesses many​ highly-weighted strengths, this is likely the result of effective​ strategies, so higher ratings in general are warranted for strengths.*** D. If a firm possesses many​ highly-weighted strengths, this is likely the result of effective​ strategies, so higher ratings in general are warranted for strengths and weaknesses. E. If a firm possesses many​ highly-weighted weaknesses, this is likely the result of effective​ strategies, so higher ratings in general are warranted for weaknesses.

Which statement below is​ FALSE?

A. In an IFE​ Matrix, the number of factors has no effect on the range of total weighted scores because the weights always add up to 1.0. B. When a key internal factor is both a strength and a​ weakness, the factor may be included twice in the IFE Matrix with a weight and rating assigned to each statement. ***C. Always sequence factors in an IFE Matrix from highest to lowest weight.*** D. The average IFE Matrix score is 2.0. E. IFE ratings are​ company-based whereas weights are​ industry-based

Which of the following statements is​ FALSE?

A. The​ resource-based view​ (RBV) approach to competitive advantage contends that internal resources are more important for a firm than external factors in achieving and sustaining competitive advantage. B. In contrast to the Industrial Organization​ (I/O) theory presented in the previous​ chapter, proponents of the RBV​ view/theory contend that organizational performance is primarily determined by internal resources. C. ​Resource-based view theory asserts that resources are actually what helps a firm exploit opportunities and neutralize threats. D. Empirical research by Neffke reveals that more than any other variable in the​ firm's value​ chain, it is the nature of a​ firm's human capital that impacts that​ firm's choice of diversification targets.​ Specifically, firms select acquisition targets that offer opportunities to leverage existing human resources. ***E. The​ resource-based view​ (RBV) approach to competitive advantage contends that internal resources are equally important for a firm as external factors in achieving and sustaining competitive advantage.***

Which of the following statements is​ TRUE?

A. When assigning weights and ratings in developing an IFE​ Matrix, focus on a narrow industry perspective for strengths and a broad industry perspective for weaknesses. B. When assigning weights and ratings in developing an IFE​ Matrix, focus on all competitors in the industry. C. When assigning weights and ratings in developing an IFE​ Matrix, focus on the top three competitors in the industry. ***D. When assigning weights and ratings in developing an IFE​ Matrix, focus on a narrow industry perspective.*** E. When assigning weights and ratings in developing and IFE​ Matrix, focus on a broad industry perspective.

Aspects of organizational culture listed in Table​ 4-4 include all but which of the​ following?

Analyze interest rate trends

Limitations of financial ratio analysis include all but which one of the following​ statements?

Financial ratios are estimates of financial condition.

The extent to which a manufacturing​ plant's output reaches its potential output is called​ ______, a key strategic variable.

capacity utilization

Strengths that cannot be easily matched or imitated by competitors are called​ ______.

distinctive competencies