Final ECON
matrix structure
An organizational form in which employees are subject to tow or more sets of managers at once
What term best describes clusters of activities that a firm does especially well in comparison with other firms
Capabilities
Which of the following products and services depend on standards
Cellular Communications Internet Video Gaming High-definition television
Conflicts of interest in the certifier market often can lead to which of the following
Certification bias
What term describes the situation when a firm earns a higher rate of economic profits than the average rate of economic profit of other firms competing within the same market
Competitive Advantage
Why is advertising an effective signal of quality in an experienced good
Consumers believe firms that can afford to heavily advertise sell quality products
Why do consumers tent to gravitate towards non-profit firms when evaluating credence goods
Consumers believe non-profit sellers will be less likely to skimp on quality for profit
Which for the following is the weakest an example of a Shock
Contracting to use another firms proprietary process
which of the following terms involves the flow of information within an organization to facilitate subunit decisions that are consistent with each other and with organizational objectives
Coordination
Which of the following is not an example of a way a seller can increase switching costs
Creating a product line compatible with parts that are made by other manufacturers
When quiet periods in markets are punctuated by fundamental shocks or discontinuities that destroy old sources of advantage and replace them with new ones
Creative destruction
Which of the following terms best describes the ability of a firm to maintain and adapt the capabilities that are the basis of its competitive advantage
Dynamic capabilities
What type of good is one whose quality can be assessed only after the customer has used it for a while
Experienced Good
Products for which consumers cannot easily compare product characteristics and value information from others are called
Experienced Goods
Under what type of strategy does a firm either offer a narrow set of varieties serve a narrow set of customers or do both
Focus Strategy
Which of the following is not a way in which consumers can benefit from report cards
Good report cards can lead to more advertising
What type of curve can be used to describe the set of price-quality combinations that yields the same consumer surplus to an individual
Indifference Curve
What term coined by Michael Porter describes a tool that can be used to show how nearly every industry can be broken down into smaller pieces known as segments
Industry Segmentation Matrix
Which of the following terms best describes a review system in which an employee and supervisor work together to construct a set of goals for that employee
Management by objective system
What kind of strategy is one by which a form maintains price parity with its competitors and profits from its benefits or cost advantage primarily through high price-cost margins rather than through a higher market share
Margin Strategy
Which of the following term describes when firms with higher scores tend to have more than their share of luck in rankings
Mean Reversion
What product characteristic refers to the situation where consumers place higher value on a product if other consumers also use it?
Network effort
Which of the following is measured by a report card that assesses product performance
Outcome
which of the following terms describes a contract by which the value of the compensation depends on the measured performance of that employee
Pay for performance contact
Which of the following is a grade used to evaluate quality
Report card
Assumption that a firm is a bundle of resources and capabilities that differ across firms. Even within the same industry, firms are unique and differ from one another
Resource heterogeneity
What term describes a framework used in strategy based on resource heterogeneity which posits that for a competitive advantage to be sustainable it must be underpinned by resource capabilities that are scarce and imperfectly mobile
Resource-based theory of the firm
What term best describes firm-specific assets such as patents and trademarks brand-name reputation installed base and organizational culture
Resources
Which of the following is a statistical process in which raw outcome measures are adjusted for factors that are beyond the control of the seller
Risk adjustment
What type of good is one whose quality is relatively easy to evaluate before purchase
Search Good
Products for which consumers can easily obtain the information required to compare alternatives are called
Search Goods
What kind of strategy is one by which a firm exploits its benefit or cost advantage through a higher market share rather than through high-price cost margins
Share Strategy
What term best refers to fundamental changes that lead to major shifts of competitive positions in a market?
Shock
When consumers learn about many products at once, it is known as
Simultaneous Search
Which of the following is a capability
Source Skills
What term refers to the costs incurred by buyers when they change to a different supplier
Switching Costs
Which of the following terms best describes a phenomenon whereby a profit-maximizing firm sticks with its current technology or product concept even though the profit-maximizing decision for a firm starting from scratch would be to choose a different technology or product concept?
The sunk cost effect
Which of the following is not a common characteristic of capabilities
They are easy to reduce to simple algorithms or procedure guides
Which of the following terms is a concept, developed by Michael Porter, which describes the activities within firms and across firms that add value along the way to the ultimate transacted good or service
Value Chain
What is the one way to measure a firms willingness to pay
Value added analysis
What term describes the process of using market prices of unfinished and semi-finished goods to estimate the incremental value-created by distinctive parts of the value chain
Value-added analysis
Which of the following best describes a focus strategy
When a firm either offer a narrow set of varieties, serve a narrow set of customers or both
Which of the following is a resource
Workers with firm-specific expertise or know-how
360 review
a review that occurs when a employees supervisor, coworkers and subordinates are all asked to provide information regarding that employees performance
Aligning individual and group tasks with those of the firm and aligning incentives so that individuals and groups will consistently work in the same directions is known as
accountability
implicit incentive contract
contract based on information that cannot be observed by courts or arbitrators
organizational structure
describes how a firm uses division of labor to organize tasks, specify how its staff performs tasks and facilitate internal and external information flaws
task interdependence
extent to which two or more positions depends on each other to do their own work
A firms ability to create a superior value, in turn depends on its stock or resources and its distinctive capabilities
firm specific assets
A phenomenon whereby individuals ignore their own information about the best course of action and instead simply do what everyone else is doing
herding
Performance measure
piece of information which an incentive contract (explicit or implicit) can be based
What term best describes an agent who is indifferent between a sure thing and a gamble of equal expected value?
risk neutral
which for the following should not be considered when selecting organizing dimensions
sunk costs
management by objective system
system whereby an employee and a supervisor work together to construct a set of goals for the employee
coorination
the flow of information within in an organization to facilitate subunit decisions that are consistent with other and with the organization
in which of the following situations identified by baron and besanko will a matrix never be optimal regardless of any additional circumstances
when spillovers are positively correlated and activities are profit complements
