Management 425 Chapter Quiz 1-3

Companies in the same strategic group are ________ to each other. a. strategic allies b. merger partners c. stakeholders or shareholders d. direct competitors

d. direct competitors

In recent years a growing number of U.S. consumers have become more health conscious about what they eat. According to the PESTEL Framework this trend could best be classified as a ( ) trend. a. political b. healthy eating c. legal d. sociocultural

d. sociocultural

The average cost of production for a bottle of mineral water in the industry is $5 while its average price is $8. Forever Spring Inc. manufactures the same product for $3 per bottle and sells it for $8 per bottle. Which of the following statements is most likely true of Forever Spring Inc. in this scenario? a. it has a competitive advantage in the industry b. it has competitive parity with other firms in the industry c. it has formed a strategic alliance with other firms in the industry d. it has a competitive disadvantage in the industry

a. it has a competitive advantage in the industry

When companies that manufacture shipping containers want to buy iron ore, the purchase decision is solely based on price. This is because there are a large number of sellers in the iron ore industry, and iron ore is a highly undifferentiated commodity. Which of the following industry competitive structures does the iron ore industry best illustrate? a. perfect competition b. monopolistic competition c. oligopoly d. monopoly

a. perfect competition

According to the five forces model, the stronger the five forces, the lower the industry's a. profit potential b. monopolistic potential c. bargaining power d. economic risk

a. profit potential

( ) is best described as a set of goal-directed actions a firm takes to gain and sustain superior performance relative to competitors. a. strategy b. behavior modification c. credo d. competency management

a. strategy

A firms strategic position is likely to be strong when a. the gap between the value the firms product generates and the cost to produce it is large. b. the entry barriers within the industry it operates in are low and the exit barriers are high. c. all the five forces in Porters model are strong. d. its suppliers and vendors can easily forward-integrate and buyers can backward-integrate.

a. the gap between the value the firms product generates and the cost to produce it is large.

Customer-oriented vision statements are better suited than product-oriented vision statements for helping companies to adapt to changing environments. a. true b. false

a. true

Strategic leaders spend the majority of their time working alone to devise new strategies. a. true b. false

b. false

The first step in stakeholder impact analysis involves which of the following? a. identifying the interests of the stakeholders b. identifying the opportunities that stakeholders present c. identifying who the stakeholders are d. identifying the social responsibilities to stakeholders

c. identifying who the stakeholders are