TEST #2 BUSA POL

Why must managers use a mechanistic structure to implement a cost-leadership strategy?

A mechanistic structure offers a centralized structure with well-defined lines of authority

Which of the following statements about an organization's culture is NOT true?

A strong monitoring and supervision mechanism is needed to enforce the culture.

Which of the following products are generally manufactured by multinational enterprises (MNEs) pursuing a global-standardization strategy?

Commodity products like computer hardware

For which of the following products is an international strategy most suitable?

For luxury goods that can be shipped across the globe

Frank is a board member at Lofloy Greens Inc., a publicly traded company. In addition to his duties on the board, Frank is also a full-time employee as a senior manager at Spinson Locomotives Inc. Which of the following is most likely to be true of Frank?

Frank is a part-time employee at Lofloy Greens.

Glova Inc., a company that manufactures and sells premium perfumes, is pursuing an international strategy. RightMart Inc., a supermarket chain, follows a multidomestic strategy. Which of the following statements is most likely true of this scenario?

Glova Inc. will sell the same products and services in both domestic and foreign markets, whereas RightMart Inc. will customize its product offerings to suit local requirements.

Lucar Steels Inc. has decided to enter into a foreign market by setting up its own production facilities and distribution channels from scratch. This will allow it to have strong control over all of its business activities. What is the foreign entry mode most likely opted by Lucar Steels Inc.?

Greenfield operation

Charlie is a strategist who wants to decide on the appropriate strategy to help his firm "go global." Which of the following should Charlie consider while choosing his strategy?

He must be aware of the fact that despite globalization and the emergence of the Internet, firm geographic location has actually maintained its importance.

Which of the following is a disadvantage of a functional strategy?

It cannot effectively address a higher level of diversification.

Which of the following statements is true of organizational culture?

It is better for founder CEOs to create a relevant culture, structure, and strategy in the early stages.

Ramadin is the CEO of Brownback Consulting Inc. Ramadin's efforts to persuade the board of directors to pursue a new business strategy fail. He borrows money from different sources and purchases all the outstanding shares of Brownback Consulting. What does this scenario best exemplify?

Leveraged buyout

Which of the following functions did HP's board of directors fail at following the unexpected departure of Mark Hurd?

Overseeing the company's CEO succession plan

Which of the following is part of Geert Hofstede's cultural dimensions?

Power distance

Which of the following acts in the Goldman Sachs-Galleon Group insider trading scandal is an egregious exploitation of information asymmetry?

Rajat Gupta providing information regarding Warren Buffet's impending multibillion-dollar injection into Goldman Sachs

What is most likely to happen if a firm relies too long on a competency without honing, refining, and upgrading as the firm and the environment change?

The firm's culture can turn from a core competency into a core rigidity

Which of the following statements best describes local responsiveness?

The need to tailor product and service offerings to fit native consumer preferences and host-country requirements

Which of the following statements is true of shareholders in a public stock company?

They are granted a charter of incorporation by the state and legally own company stock.

Which of the following is NOT true about the members of the board of directors in a public stock company?

They are not responsible to shareholders.

Which of the following statements about W.L. Gore & Associates best supports the fact that it is organized in an informal and decentralized manner?

W.L. Gore & Associates refers to its employees as associates rather than employees.

At Opnic Corp., a cross-functional team is formed to work on a project for a new client. The team consists of Darius and four other members. At most of the team's presentations to senior management, Darius takes the lead and discusses project specifics with the management, while others chip in with additional information. At the completion of the project, Darius is recommended for promotion, while the other team members receive little recognition for their hard work. The reality is that Darius did very little actual work but spent some time compiling the project report based on different documents submitted by the others. This scenario at Opnic Corp. is a typical consequence of _____.

adverse selection

Neville and Andre are customer care employees at JPN Care. In between calls, Neville and Andre spend time on Facebook and YouTube. The relaxed guidelines at JPN allow them to do that. However, sometimes, they knowingly avoid answering calls or keep customers on hold, while they check their social networking accounts. Such behavior:

can be stopped by implementing performance incentives and strict control mechanisms.

The _____ states that geographic location alone should not lead to firm-level competitive advantage because firms are now, more than ever, able to source inputs globally.

death-of-distance hypothesis

A firm that uses a structure that is organized along different business functions such as HR, R&D, Sales, and Marketing and also along different geographical areas such as different countries of the world is most likely using a _____ structure.

global matrix

A functional structure is recommended when a firm:

has a low level of diversification.

The informational advantage that agents possess over principals is often based on the fact that:

insiders are the first to learn about important developments before the information is released to the public.

A(n) _____ arises out of the combination of high pressure for local responsiveness and high pressure for cost reductions.

multidomestic strategy

Fast Call Inc. is a pharmaceutical company that has many breakthroughs in medicine to its credit. Unlike many other pharmaceutical companies, Fast Call has a relaxed work environment where employees are free to discuss projects with each other. Employees are encouraged to choose the projects that interest them; communication between team members and their supervisors is open and easy. Because of the company's work culture, its employees feel motivated to work harder and display more entrepreneurial behaviors. In this scenario, Fast Call Inc. is most likely an organization that is _____.

organic

A firm's _____ determines how the work efforts of individuals and teams are orchestrated and how resources are distributed.

structure

The MBA oath first developed at Harvard and now signed by students at over 300 business schools is modeled after _____.

the Hippocratic oath in medicine

Multinational enterprises (MNEs) like Harley-Davidson, Rolex, and Starbucks are said to be following an international strategy because:

they offer the same products or services in all their stores throughout the world.