Pace University MGT 490 Chapter 5 Quiz Spring 2015

(MGT490 20353 Spring 2015)

Assignment:

Chapter 05 Quiz

1.

award:

10 out of

10.00 points

The industry life cycle is important because ______________.

it points out the need to maintain a differentiation advantage and a low-cost advantage simultaneously

of its ability to serve as a short-run forecasting device

trends suggested by the market life cycle model are generally not reversible or repeatable

the emphasis on various generic strategies varies over the course of an industry life cycle

2.

award:

10 out of

10.00 points

If a firm is able to achieve above-average returns despite strong competition, it is likely to be using __________ strategy.

cost leadership focus

differentiation focus

differentiation

overall cost leadership

3.

award:

10 out of

10.00 points

Competitive advantage is affected by the rate of globalization in an industry.

True

False

4.

award:

10 out of

10.00 points

If a company focuses on a small number of value-chain activities, it can be lead to a pitfall of the overall cost leadership strategy.

True

False

5.

award:

10 out of

10.00 points

A firm that competes on cost leadership can be vulnerable if there is a decrease in the cost of the inputs on which the advantage is based.

True

False

6.

award:

10 out of

10.00 points

In technology intensive industries, the competitive advantages decrease over time.

True

False

7.

award:

10 out of

10.00 points

Emphasis on process design is high during the __________ stage of the industry life cycle.

decline

growth

introduction

maturity

8.

award:

10 out of

10.00 points

Company competitive advantage can be eroded for all of the following reasons except one. Which is that reason?

length of time a company is in business

globalization

actions by rivals from within and outside of the industry

rapid change in technology

9.

award:

10 out of

10.00 points

A cost leadership strategy may lead to a reduction in flexibility.

True

False

10.

award:

10 out of

10.00 points

Competitive advantage that is based solely on a focus strategy on a narrow competitive scope is not sufficient for assuring the sustainability

of the strategy.

True

False

11.

award:

10 out of

10.00 points

A cost leadership strategy can put the firm at a competitive disadvantage, due to a declining base of cost advantage.

True

False

12.

award:

10 out of

10.00 points

Research shows that which of the following is not a strategy used by firms engaged in successful turnarounds?

market expansion

cost surgery

piecemeal productivity improvements

asset reduction

13.

award:

10 out of

10.00 points

Coca Cola and Caterpillar used first mover advantage in the building of their global presence.

True

False

14.

award:

10 out of

10.00 points

One of the following methods of implementing a differentiation strategy has been greatly enhanced because of Internet technologies. Which

one is it?

celebrity endorsements

exceptional service

prestige packaging

enabling of mass customization

15.

award:

10 out of

10.00 points

A profit pool is defined as the total revenue in an industry at all points along the industry supply chain.

True

False

16.

award:

10 out of

10.00 points

A profit pool can be defined as the total profits in an industry at all points along the industry _____ chain.

market

seller

value

supply

17.

award:

10 out of

10.00 points

The French automobile maker, Renault, has designed an ultra-low-cost platform in order to improve its competitive position through cost

leadership.

True

False

18.

award:

10 out of

10.00 points

Products are unfamiliar to consumers in the ___________stage of a business life cycle.

introduction

growth

maturity

decline

19.

award:

0 out of

10.00 points

A disadvantage of firms that successfully integrate overall cost leadership and differentiation strategies is that they are relatively difficult for

competitors to imitate.

True

False

20.

award:

0 out of

10.00 points

If primary value chain activities involve effective management of inbound logistics and support activities include increased efforts in

technology development, this is representative of which type of competitive advantage?

differentiation

overall cost leadership

stuck-in-the-middle

differentiation focus

21.

award:

10 out of

10.00 points

The Internet is lowering transaction costs for several reasons. Which is not one of those reasons?

reducing business travel

increasing the number of transactions

minimizing office expenses

eliminating supply chain intermediaries

22.

award:

0 out of

10.00 points

Many firms facing a turnaround situation try to fix their situation by increasing the financial investment in administrative expenses and

inventories.

True

False

23.

award:

10 out of

10.00 points

One way the Internet and digital technologies are creating opportunities for firms with differentiation strategies is by improving the response to

customer wishes through mass customization.

True

False

24.

award:

10 out of

10.00 points

The three generic strategies presented by Michael Porter can be shown on two dimensions: strategic target and product life cycle.

True

False

25.

award:

10 out of

10.00 points

If a company is using a cost leadership strategy, which of the following is not a characteristic of that strategy?

Too much focus on one value chain activity can lead to greater loss.

The strategy is not easily imitated.

A lack of parity on differentiation is evident.

Cost advantages erode when pricing information is readily available.