Question 1

Value-chain support activities that involve excellent applications engineering support (technology development)  and facilities that promote a positive firm image (firm infrastructure) characterize which generic strategy?

Accepted Answer

A)   overall cost leadership
B)   differentiation focus
C)   differentiation
D)   stuck-in-the middleE) A) and D)
F) A) and C)

Question 2

The market life cycle should be used for short-run forecasting because it provides a conceptual framework for understanding what changes typically occur over the life of an industry.

Accepted Answer

A) True 
 B)False

Question 3

Atlas Door tightly controlled logistics so that it always shipped only fully complete orders to construction sites. In regard to the five forces model, which of the following is a reason this might give them competitive advantage?

Accepted Answer

A)   It helps to reduce the threat of new entrants.
B)   It created low entry barriers for new entrants.
C)   It created a high threat of substitution.
D)   It gave more power to buyers.E) A) and B)
F) B) and C)

Question 4

A pitfall of integrated overall cost leadership and differentiation is underestimating the expenses associated with coordinating value-creating activities in the extended value chain.

Accepted Answer

A) True 
 B)False

Question 5

Most turnarounds require a firm to carefully analyze its relevant environments. The ________ analysis leads to identification of market segments or customer groups that may still findtheproduct attractive.

Accepted Answer

A)   external
B)   internal
C)   global
D)   environmentalE) All of the above
F) A) and B)

Question 6

BlackBerry lost its competitive advantage by 2016 because it

Accepted Answer

A)   did not deliver innovations to respond to changing market demand.
B)   developed a highly performant just-in-time delivery system.
C)   did not reward its employees.
D)   let suppliers have dominant power.E) A) and D)
F) All of the above

Question 7

Atlas Door created competitive advantages in overall low cost and differentiation by creating ________ among value-chain activities.

Accepted Answer

A)   substitutes
B)   advantages
C)   disadvantages
D)   linkagesE) C) and D)
F) B) and C)

Question 8

Which statement regarding competitive advantages is true?

Accepted Answer

A)   With an overall cost leadership strategy, firms need not be concerned with parity on differentiation.
B)   In the long run, a business with one or more competitive advantages is probably destined to earn normal profits.
C)   If several competitors pursue similar differentiation tactics, they may all be perceived as equals in the mind of the consumer.
D)   Attaining multiple types of competitive advantage is a recipe for failure.E) B) and C)
F) None of the above

Question 9

Improving business processes by reengineering them, benchmarking specific activities against industry leaders, encouraging employee input to identify excess costs, increasing capacityutilization, and improving employee productivity lead to a significant overall gain. These are examples of which turnaround strategy used by successful companies?

Accepted Answer

A)   asset and cost surgery
B)   selective product and market pruning
C)   piecemeal productivity improvements
D)   global expansionE) C) and D)
F) A) and D) C

Question 10

Which of the following is not a potential pitfall of a differentiation strategy?

Accepted Answer

A)   Uniqueness that is not valuable.
B)   The price premium is too high.
C)   All rivals share a common input or raw material.
D)   Perceptions of differentiation may vary between buyers and sellers.E) All of the above
F) A) and B)

Question 11

Few turnarounds require firms to analyze both the external and internal environments relevant to their firm.

Accepted Answer

A) True 
 B)False

Question 12

The five-forces model suggests that with intense competition an overall low-cost position will not enable a firm to achieve above-average returns.

Accepted Answer

A) True 
 B)False

Question 13

Zulily protects itself from buyer power and intense rivalry from competitors by

Accepted Answer

A)   increasing the bargaining power of its customers.
B)   paying close attention to costs.
C)   increasing costs.
D)   increasing the buyer power.E) C) and D)
F) A) and D)

Question 14

Primark, an Irish clothing retailer, uses an overall cost leadership strategy. This could fail if it

Accepted Answer

A)   maintains parity with competitors on low cost.
B)   cannot maintain parity on differentiation dimensions requested by customers.
C)   exceeds customer expectations.
D)   increases its sales prices while maintaining competitor parity.E) None of the above
F) A) and D)

Question 15

Factors that lead to a low-cost position also provide substantial entry barriers to substitute and new products as is demonstrated by the retailer, Aldi, whose focus on minimizing costsacross the entire operation permits it to position well against competitors such as Walmart.

Accepted Answer

A) True 
 B)False

Question 16

The experience curve is a factor central to an overall cost leadership strategy and refers to how business learns to increase costs as it gains experience with production processes.

Accepted Answer

A) True 
 B)False  False

Question 17

An overall low-cost position protects a firm against rivalry from competitors because ________ allow a firm to earn returns even if its competitors eroded their profits through intenserivalry.

Accepted Answer

A)   higher costs
B)   higher prices
C)   lower costs
D)   lower pricesE) All of the above
F) C) and D)

Question 18

A manufacturing business pursuing cost leadership is likely to

Accepted Answer

A)   focus on a narrow market segment.
B)   use advertising to build brand image.
C)   put heavy emphasis on product engineering.
D)   rely on experience effects to raise efficiency.E) All of the above
F) B) and C) D

Question 19

A ________ can be defined as the total profits in an industry at all points along the industry value chain.

Accepted Answer

A)   profit maximizer
B)   revenue enhancer
C)   profit pool
D)   profit outsourcingE) A) and D)
F) A) and C)

Question 20

An overall ________ position enables a firm to achieve above-average returns because it protects firms against powerful buyers.

Accepted Answer

A)   differentiation
B)   low-cost
C)   focused
D)   high-costE) A) and B)
F) None of the above

Exam 5: Business-Level Strategy Creating and Sustaining Competitive Advantages

Value-chain support activities that involve excellent applications engineering support (technology development) and facilities that promote a positive firm image (firm infrastructure) characterize which generic strategy?

Correct Answer
verified

The market life cycle should be used for short-run forecasting because it provides a conceptual framework for understanding what changes typically occur over the life of an industry.

Correct Answer
verified

Atlas Door tightly controlled logistics so that it always shipped only fully complete orders to construction sites. In regard to the five forces model, which of the following is a reason this might give them competitive advantage?

Correct Answer
verified

A pitfall of integrated overall cost leadership and differentiation is underestimating the expenses associated with coordinating value-creating activities in the extended value chain.

Correct Answer
verified

Most turnarounds require a firm to carefully analyze its relevant environments. The ________ analysis leads to identification of market segments or customer groups that may still findtheproduct attractive.

Correct Answer
verified

BlackBerry lost its competitive advantage by 2016 because it

Correct Answer
verified

Atlas Door created competitive advantages in overall low cost and differentiation by creating ________ among value-chain activities.

Correct Answer
verified

Which statement regarding competitive advantages is true?

Correct Answer
verified

Correct Answer
verified
C

Which of the following is not a potential pitfall of a differentiation strategy?

Correct Answer
verified

Few turnarounds require firms to analyze both the external and internal environments relevant to their firm.

Correct Answer
verified

The five-forces model suggests that with intense competition an overall low-cost position will not enable a firm to achieve above-average returns.

Correct Answer
verified

Zulily protects itself from buyer power and intense rivalry from competitors by

Correct Answer
verified

Primark, an Irish clothing retailer, uses an overall cost leadership strategy. This could fail if it

Correct Answer
verified

Factors that lead to a low-cost position also provide substantial entry barriers to substitute and new products as is demonstrated by the retailer, Aldi, whose focus on minimizing costsacross the entire operation permits it to position well against competitors such as Walmart.

Correct Answer
verified

The experience curve is a factor central to an overall cost leadership strategy and refers to how business learns to increase costs as it gains experience with production processes.

Correct Answer
verified
False

An overall low-cost position protects a firm against rivalry from competitors because ________ allow a firm to earn returns even if its competitors eroded their profits through intenserivalry.

Correct Answer
verified

A manufacturing business pursuing cost leadership is likely to

Correct Answer
verified
D

A ________ can be defined as the total profits in an industry at all points along the industry value chain.

Correct Answer
verified

An overall ________ position enables a firm to achieve above-average returns because it protects firms against powerful buyers.

Correct Answer
verified

Exam 5: Business-Level Strategy Creating and Sustaining Competitive Advantages

Value-chain support activities that involve excellent applications engineering support (technology development) and facilities that promote a positive firm image (firm infrastructure) characterize which generic strategy?

Correct AnswerverifiedShow Answer

The market life cycle should be used for short-run forecasting because it provides a conceptual framework for understanding what changes typically occur over the life of an industry.

Correct AnswerverifiedShow Answer

Atlas Door tightly controlled logistics so that it always shipped only fully complete orders to construction sites. In regard to the five forces model, which of the following is a reason this might give them competitive advantage?

Correct AnswerverifiedShow Answer

A pitfall of integrated overall cost leadership and differentiation is underestimating the expenses associated with coordinating value-creating activities in the extended value chain.

Correct AnswerverifiedShow Answer

Most turnarounds require a firm to carefully analyze its relevant environments. The ________ analysis leads to identification of market segments or customer groups that may still findtheproduct attractive.

Correct AnswerverifiedShow Answer

BlackBerry lost its competitive advantage by 2016 because it

Correct AnswerverifiedShow Answer

Atlas Door created competitive advantages in overall low cost and differentiation by creating ________ among value-chain activities.

Correct AnswerverifiedShow Answer

Which statement regarding competitive advantages is true?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedC

Which of the following is not a potential pitfall of a differentiation strategy?

Correct AnswerverifiedShow Answer

Few turnarounds require firms to analyze both the external and internal environments relevant to their firm.

Correct AnswerverifiedShow Answer

The five-forces model suggests that with intense competition an overall low-cost position will not enable a firm to achieve above-average returns.

Correct AnswerverifiedShow Answer

Zulily protects itself from buyer power and intense rivalry from competitors by

Correct AnswerverifiedShow Answer

Primark, an Irish clothing retailer, uses an overall cost leadership strategy. This could fail if it

Correct AnswerverifiedShow Answer

Factors that lead to a low-cost position also provide substantial entry barriers to substitute and new products as is demonstrated by the retailer, Aldi, whose focus on minimizing costsacross the entire operation permits it to position well against competitors such as Walmart.

Correct AnswerverifiedShow Answer

The experience curve is a factor central to an overall cost leadership strategy and refers to how business learns to increase costs as it gains experience with production processes.

Correct AnswerverifiedFalse

An overall low-cost position protects a firm against rivalry from competitors because ________ allow a firm to earn returns even if its competitors eroded their profits through intenserivalry.

Correct AnswerverifiedShow Answer

A manufacturing business pursuing cost leadership is likely to

Correct AnswerverifiedD

A ________ can be defined as the total profits in an industry at all points along the industry value chain.

Correct AnswerverifiedShow Answer

An overall ________ position enables a firm to achieve above-average returns because it protects firms against powerful buyers.

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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C

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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False

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D

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Correct Answer
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