Policies- Chpt 1 Quiz

False

The CEO of Twin Spires, Inc., is emotionally and intellectually committed to using the resources of the firm to serve the needs of the natural gardening community by providing rare and native plants to individuals and nurseries around the United States. This commitment has carried the CEO through long periods of below average returns on investment. The perspective of the CEO of Twin Spires is consistent with the assumptions of the industrial organizational (I/O) model.

False

The I/O (industrial organization) model assumes that the uniqueness of a firm's resources and capabilities are its main source of above-average returns.

True

The five forces model includes among five forces: suppliers, buyers, competitive rivalry among firms currently in the industry, product substitutes, and potential entrants to the industry.

True

The two primary drivers of hypercompetition are the emergence of the global economy and technology.

False

The degree to which the firm is dependent on a stakeholder group gives that stakeholder less influence.

True

A strategy is an integrated and coordinated set of commitments and actions designed to exploit core competencies and gain a competitive advantage.

True

Above-average returns are returns in excess of what an investor expects to earn from other investments with a similar amount of risk.

True

According to resource based view, the uniqueness of its resources and capabilities is the basis of a firm's strategy and its ability to earn above-average returns.

False

An effective vision statement should specify the market to be served.

True

Apple's R&D function is likely one of its core competencies. This example can be supported by resource based view.

False

Business-level strategy is concerned with determining the businesses in which the company intends to compete as well as how to manage its different businesses.

False

Differnetiation strategy can be described as producing standardized goods or services at costs below those of competitors.

True

Hypercompetition can be characterized by market instability and aggressive challengers.

True

India is the world's largest democracy.

True

Not all of a firm's resources and capabilities have the potential to be the foundation for a competitive advantage. This potential is realized when resources and capabilities are valuable, rare, costly to imitate, and nonsubstitutable.

False

Resources are considered rare when they have no structural equivalent.

True

Strategic competitiveness is achieved when a firm successfully formulates and implements a value-creating strategy.

True

Strategic leaders are people located in different areas and levels of the firm using the strategic management process to select strategic actions that help the firm achieve its vision and fulfill its mission

True

Strategic management process is a rational approach firms use to achieve strategic competitiveness and earn above-average returns.

False

tomCustomers, suppliers, unions, and local governments are examples of capital market stakeholders.