Quiz for Strategy 2

In strategic planning, a rational, data-driven strategy process that works
reasonably well when the environment does not change much is known as

• Scenario planning

• Bottom-Up strategy

• Top-down strategy

• Planned emergence

The ________ allows the scanning, monitoring, and evaluating of changes and trends in
a firm's macroenvironment.

• VRIO framework

• SWOT analysis

• BCG matrix

• PESTEL framework

Which of the following external forces is a part of a firm's task environment?

• The composition of the strategic group to which the firm belongs

• The interest rates prevalent in the economy in which the firm operate

• The inflation level in the economy in which the firm operates

• The recent innovations in process technology, including lean manufacturing

A firm's strategic position is likely to be strong when

• the entry barriers within the industry it operates in are low and the exit barriers are high

• its suppliers and vendors can easily forward integrate and buyers can backward
  integrate

• all the five forces in Porter's model are strong

• the gap between the value the firm's product generates and the cost to produce it is
  large

Keeping in mind the five forces in the airline industry, which of the following best
explains the difficulty airlines have in generating a profit?

• Substitutes are readily available (especially for shorter distances) in the form of trains,
  buses, and cars, thus reducing the profit potential in the industry

• Suppliers have weak bargaining power because they offer products that are not
  differentiated

• Entry barriers in the industry are high, resulting in hardly any new airlines popping up

• Consumers in the industry make decisions based on price, thus reducing the intensity of
  rivalry in the industry

In which of the following situations is the power of suppliers high in an industry?

• Suppliers offer products that are undifferentiated

• Suppliers can credibly threaten to backward integrate into the industry

• Suppliers depend heavily on the industry for their revenues

• Suppliers' industry is more concentrated than the industry it sells to

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?

• Monopoly

• Oligopoly

• Perfect Competition

• Monopolistic Competition

Which of the following statements is true about strategic groups?

• It is not possible to have two different strategic groups within the same industry

• Rivalry within the same strategic group tends to be lower than rivalry between different
  strategic groups

• Profitability varies between different strategic groups

• Companies within the same strategic group are complementors to each other

Beats Electronics has been able to outperform Audio-Technica, Bose, JBL, Skullcandy,
Sennheiser, and Sony in the high-end, premium headphone market. Which of the following
statements accurately explains one of the main reasons for the success of Beats?

• It produced the highest-quality headphones

• It created a perception that owning its products was cool

• It emphasized marketing over core competency

• It focused on sponsoring future athletic superstars

How are the critical assumptions of the resource-based model of a firm fundamentally
different from the way in which a firm is viewed in the perfectly competitive industry
structure?

• In the resource-based model, resources are freely available and mobile, whereas in the
  perfectly competitive industry structure, resources are highly immobile

• In perfect competition, it is extremely difficult to replicate the resource bundles of a firm,
  whereas in the resource-based model, it is extremely easy to imitate them

• In perfect competition, all firms have access to the same capabilities, whereas in the
  resource-based model, resource differences exist between firms in the same industry

• In the resource-based model, only physical assets of a firm are considered as resources,
  whereas in perfect competition, a firm's capabilities and competencies are also considered
  as resources