Question 1

Most turnarounds require a firm to carefully analyze its relevant environments.________ analysis results in actions aimed at reduced costs and higher efficiency.

Accepted Answer

A)   External
B)   Internal
C)   Global
D)   EnvironmentalE) A) and D)
F) C) and D)

Question 2

The French automobile maker,Renault,attains competitive advantage by revamping cars to be more cost efficient.

Accepted Answer

A) True 
 B)False

Question 3

One aspect of using a cost leadership strategy is that experience effects may lead to lower costs.Experience effects are achieved by

Accepted Answer

A)   spreading out a given expense or investment over a greater volume.
B)   hiring more experienced personnel.
C)   repeating a process until a task becomes easier.
D)   competing in an industry for a long time.E) A) and D)
F) A) and C)

Question 4

Procter and Gamble successfully implemented a turnaround strategy by discontinuing brands and focusing all resources on a few core brands.

Accepted Answer

A) True 
 B)False

Question 5

An important issue in evaluating the sustainability of a unique strategy is whether or not rivals will be able to imitate its strategy or create a viable substitute.

Accepted Answer

A) True 
 B)False

Question 6

The most likely time to pursue a harvest strategy is in a situation of

Accepted Answer

A)   high growth.
B)   strong competitive advantage.
C)   mergers and acquisitions.
D)   decline.E) A) and B)
F) All of the above

Question 7

When a company finds that its performance is in decline at any stage in the life cycle,it can look toward a turnaround strategy that is designed to help it to grow but not necessarily to be profitable.

Accepted Answer

A) True 
 B)False

Question 8

In a given market,key technology no longer has patent protection,experience is not an advantage,and there is a growing need to compete on price.What stage of its life cycle is the market in?

Accepted Answer

A)   introduction
B)   growth
C)   maturity
D)   declineE) All of the above
F) B) and C)

Question 9

Atlas Door could lose competitive advantage for all of the following reasons except

Accepted Answer

A)   Its technologies are non-proprietary.
B)   A rival could hire away its talents easily.
C)   A new rival with a strong resource base could undercut its prices.
D)   It has strong power over its distributors.E) C) and D)
F) None of the above

Question 10

Porsche has enhanced power over buyers because its strong reputation makes buyers more willing to pay a premium price.This ______ rivalry,since buyers become _____ price-sensitive.

Accepted Answer

A)   increases; more
B)   lessens; more
C)   lessens; less
D)   increases; lessE) A) and D)
F) A) and C)

Question 11

Primary value chain activities that involve the effective layout of receiving dock operations (inbound logistics) and support value chain activities that include expertise in process engineering (technology development) characterize which generic strategy?

Accepted Answer

A)   differentiation
B)   differentiation focus
C)   stuck-in-the-middle
D)   overall cost leadershipE) B) and C)
F) All of the above

Question 12

The growth stage of the industry life cycle is characterized by

Accepted Answer

A)   in-kind competition (from the same type of product) .
B)   premium pricing.
C)   a growing trend to compete on the basis of price.
D)   retaliation by competitors whose customers are stolen.E) A) and C)
F) C) and D)

Question 13

Outright sales or sale and leaseback free up considerable cash and improve returns.This is an example 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) All of the above
F) A) and B)

Question 14

Integration of information systems,logistics,and transportation at Walmart helps it to drive down costs and provide outstanding product selection.This serves to erect low entry barriers to potential competitors.

Accepted Answer

A) True 
 B)False

Question 15

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 intense rivalry.

Accepted Answer

A)   higher costs
B)   higher prices
C)   lower costs
D)   lower pricesE) None of the above
F) All of the above

Question 16

During the growth stage of the market life cycle,customers are very likely to establish brand loyalty.

Accepted Answer

A) True 
 B)False

Question 17

Atlas Door tightly controlled logistics so that it always shipped only fully complete orders to construction sites.In regards 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 D)
F) B) and C)

Question 18

By separating the value of the actual flight from the services associated with flying,airlines have greatly expanded the __________ associated with flying.

Accepted Answer

A)   costs
B)   services
C)   profit pool
D)   difficultiesE) A) and D)
F) A) and C)

Question 19

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)   rely on experience effects to raise efficiency.
D)   put heavy emphasis on product engineering.E) A) and B)
F) B) and D)

Question 20

Which of the following is not a reason for the successful turnaround HSN experienced by 2014 under CEO Mindy Grossman?

Accepted Answer

A)   engaging stakeholders in the discussion
B)   redesigning the employee lineup
C)   redesigning the company offerings
D)   making all best efforts to offer something for everyoneE) A) and B)
F) None of the above

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

In a given market,key technology no longer has patent protection,experience is not an advantage,and there is a growing need to compete on price.What stage of its life cycle is the market in?

Correct AnswerverifiedShow Answer

An important issue in evaluating the sustainability of a unique strategy is whether or not rivals will be able to imitate its strategy or create a viable substitute.

Correct AnswerverifiedShow Answer

During the growth stage of the market life cycle,customers are very likely to establish brand loyalty.

Correct AnswerverifiedShow Answer

Most turnarounds require a firm to carefully analyze its relevant environments.________ analysis results in actions aimed at reduced costs and higher efficiency.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Procter and Gamble successfully implemented a turnaround strategy by discontinuing brands and focusing all resources on a few core brands.

Correct AnswerverifiedShow Answer

The French automobile maker,Renault,attains competitive advantage by revamping cars to be more cost efficient.

Correct AnswerverifiedShow Answer

By separating the value of the actual flight from the services associated with flying,airlines have greatly expanded the __________ associated with flying.

Correct AnswerverifiedShow Answer

Primary value chain activities that involve the effective layout of receiving dock operations (inbound logistics) and support value chain activities that include expertise in process engineering (technology development) characterize which generic strategy?

Correct AnswerverifiedShow Answer

A manufacturing business pursuing cost leadership is likely to

Correct AnswerverifiedShow Answer

When a company finds that its performance is in decline at any stage in the life cycle,it can look toward a turnaround strategy that is designed to help it to grow but not necessarily to be profitable.

Correct AnswerverifiedShow Answer

Which of the following is not a reason for the successful turnaround HSN experienced by 2014 under CEO Mindy Grossman?

Correct AnswerverifiedShow Answer

The most likely time to pursue a harvest strategy is in a situation of

Correct AnswerverifiedShow Answer

The growth stage of the industry life cycle is characterized by

Correct AnswerverifiedShow Answer

One aspect of using a cost leadership strategy is that experience effects may lead to lower costs.Experience effects are achieved by

Correct AnswerverifiedShow Answer

Porsche has enhanced power over buyers because its strong reputation makes buyers more willing to pay a premium price.This ______ rivalry,since buyers become _____ price-sensitive.

Correct AnswerverifiedShow Answer

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 intense rivalry.

Correct AnswerverifiedShow Answer

Outright sales or sale and leaseback free up considerable cash and improve returns.This is an example of which turnaround strategy used by successful companies?

Correct AnswerverifiedShow Answer

Integration of information systems,logistics,and transportation at Walmart helps it to drive down costs and provide outstanding product selection.This serves to erect low entry barriers to potential competitors.

Correct AnswerverifiedShow Answer

Atlas Door could lose competitive advantage for all of the following reasons except

Correct AnswerverifiedShow Answer

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Porsche has enhanced power over buyers because its strong reputation makes buyers more willing to pay a premium price.This __ rivalry,since buyers become _ price-sensitive.

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