Question 1

In the embryonic stage of the industry life cycle,a company's investment needs and production costs are low.

Accepted Answer

A) True 
 B)False  False

Question 2

In a bid to expand its business and gain cost advantages,Omega Inc.has established several merchandising outlets in different locations.All the outlets share a good network and are interconnected by information technology.The entire network of outlets operates in the industry as one large company.Which of the following strategies has Omega Inc.most likely used ?

Accepted Answer

A) Chaining 
B) Franchising 
C) Horizontal merger 
D) Niche strategy 
E) Divestment strategy 
A) Chaining 
B) Franchising 
C) Horizontal merger 
D) Niche strategy 
E) Divestment strategy A

Question 3

Alpha corporation owns and controls several retail outlets and is pursuing a strategy called franchising.

Accepted Answer

A) True 
 B)False  False

Question 4

An embryonic industry is one that:

Accepted Answer

A) includes a number of small and medium sized companies. 
B) is just beginning to develop and customer demand is initially limited. 
C) has sufficiently developed so that early industry leaders have already been identified. 
D) has initial government backing because of its importance to the general populace. 
E) is characterized by intense rivalry among established companies. 
A) includes a number of small and medium sized companies. 
B) is just beginning to develop and customer demand is initially limited. 
C) has sufficiently developed so that early industry leaders have already been identified. 
D) has initial government backing because of its importance to the general populace. 
E) is characterized by intense rivalry among established companies.

Question 5

In a declining industry,a company may utilize a harvest strategy and:

Accepted Answer

A) significantly increase its investment in a business. 
B) extract maximum profits from its investments. 
C) venture into new market segments with new products. 
D) expand the number of stores or outlets for its products. 
E) significantly increase its advertising expenditure. 
A) significantly increase its investment in a business. 
B) extract maximum profits from its investments. 
C) venture into new market segments with new products. 
D) expand the number of stores or outlets for its products. 
E) significantly increase its advertising expenditure.

Question 6

A market growth factor that explains customers' perceptions of a new product as better at satisfying their needs than the product it replaces is called:

Accepted Answer

A) complexity 
B) relative advantage 
C) compatibility 
D) trialability 
E) observability 
A) complexity 
B) relative advantage 
C) compatibility 
D) trialability 
E) observability

Question 7

In deciding on a strategy,a company in a declining industry must do all of the following except

Accepted Answer

A) lower prices. 
B) manage industry capacity. 
C) evaluate its strengths relative to the remaining pockets of demand. 
D) evaluate the severity of decline. 
E) monitor its cash flow. 
A) lower prices. 
B) manage industry capacity. 
C) evaluate its strengths relative to the remaining pockets of demand. 
D) evaluate the severity of decline. 
E) monitor its cash flow.

Question 8

Fragmented industries typically have high barriers to entry.

Accepted Answer

A) True 
 B)False

Question 9

When a company decides to exit an industry by selling off its business assets to another company,it is said to be using a(n)_____ strategy.

Accepted Answer

A) market penetration 
B) divestment 
C) niche 
D) downsizing 
E) outsourcing 
A) market penetration 
B) divestment 
C) niche 
D) downsizing 
E) outsourcing

Question 10

Which of the following is an advantage of franchising?

Accepted Answer

A) It gives the franchisor the same level of tight control over franchisees as does chaining. 
B) It allows the franchisor to earn all of the profits made by franchisees. 
C) It is beneficial for franchisees because they do not have to face higher capital costs. 
D) It helps the franchisees by relieving them of the responsibility of running operations. 
E) It can help the franchisor expand his or her business rapidly. 
A) It gives the franchisor the same level of tight control over franchisees as does chaining. 
B) It allows the franchisor to earn all of the profits made by franchisees. 
C) It is beneficial for franchisees because they do not have to face higher capital costs. 
D) It helps the franchisees by relieving them of the responsibility of running operations. 
E) It can help the franchisor expand his or her business rapidly.

Question 11

One characteristic of embryonic industries is unconventional and specialized distribution channels.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following statements is true of growing industries?

Accepted Answer

A) Innovators and early adopters have the same customer needs as the early majority. 
B) Innovators and early adopters are typically reached through specialized distribution channels. 
C) Reaching the early majority rarely requires advertising and is usually achieved through word of mouth. 
D) Companies serving innovators need to have large-scale mass production and very low prices. 
E) Companies competing in an embryonic market typically pay more attention to increasing the reliability of a product than to its performance. 
A) Innovators and early adopters have the same customer needs as the early majority. 
B) Innovators and early adopters are typically reached through specialized distribution channels. 
C) Reaching the early majority rarely requires advertising and is usually achieved through word of mouth. 
D) Companies serving innovators need to have large-scale mass production and very low prices. 
E) Companies competing in an embryonic market typically pay more attention to increasing the reliability of a product than to its performance.

Question 13

Which of the following statements is true of declining industries?

Accepted Answer

A) Typically, not all segments of an industry decline at the same rate. 
B) A declining industry should ideally use the leadership strategy when it does not have any strengths and the competition is low. 
C) Divestment strategy is when a company in a declining industry tries to improve sales by improving product quality. 
D) The greater the exit barriers of a declining industry, the lower the intensity of competition. 
E) The intensity of competition lower in declining industries that sell commodity-like products. 
A) Typically, not all segments of an industry decline at the same rate. 
B) A declining industry should ideally use the leadership strategy when it does not have any strengths and the competition is low. 
C) Divestment strategy is when a company in a declining industry tries to improve sales by improving product quality. 
D) The greater the exit barriers of a declining industry, the lower the intensity of competition. 
E) The intensity of competition lower in declining industries that sell commodity-like products.

Question 14

___________ is a market growth factor that refers to the degree to which the results of using and enjoying a new product can be seen and appreciated by other people.

Accepted Answer

A) Complexity 
B) Relative advantage 
C) Compatibility 
D) Trialability 
E) Observability 
A) Complexity 
B) Relative advantage 
C) Compatibility 
D) Trialability 
E) Observability

Question 15

Market penetration involves the creation of new and innovative products to replace existing ones.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is a disadvantage of franchising?

Accepted Answer

A) It restricts the franchisor from expanding. 
B) It results in the franchisor taking all the financial burden of the franchisees. 
C) It results in the delegation of authority to franchisees, and the franchisor may not enjoy complete control. 
D) It does not provide sufficient incentive to the franchisees to run operations effectively because franchisees are not entrepreneurs. 
E) It requires the franchisees to create a new business model and plan strategies. 
A) It restricts the franchisor from expanding. 
B) It results in the franchisor taking all the financial burden of the franchisees. 
C) It results in the delegation of authority to franchisees, and the franchisor may not enjoy complete control. 
D) It does not provide sufficient incentive to the franchisees to run operations effectively because franchisees are not entrepreneurs. 
E) It requires the franchisees to create a new business model and plan strategies.

Question 17

Early adopters are customers who purchase a new technology or product only when they are convinced that it will be around for a long time.

Accepted Answer

A) True 
 B)False

Question 18

Innovators and early adopters have very different customer needs from the early majority.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following statements is true of embryonic industries?

Accepted Answer

A) They are characterized by very a high initial customer demand. 
B) They are characterized by well-developed distribution channels. 
C) They involve low production costs because of large volumes of production. 
D) They face the challenge of educating customers who are not familiar with their product benefits. 
E) They enjoy the abundance of complementary products that help increase sales. 
A) They are characterized by very a high initial customer demand. 
B) They are characterized by well-developed distribution channels. 
C) They involve low production costs because of large volumes of production. 
D) They face the challenge of educating customers who are not familiar with their product benefits. 
E) They enjoy the abundance of complementary products that help increase sales.

Question 20

Gadgetbug,an electronic gadgets company,has established itself as one of the industry leaders.The company has been facing competition from new entrants.The new entrants offer gadgets in different colors,with compelling artwork embossed on the cases.Seeing the interest in this market,Gadgetbug introduced its own range of uniquely designed gadgets.In this scenario,Gadgetbug's attempt to cater to the different segments of customers to deter competition demonstrates:

Accepted Answer

A) price signaling 
B) product proliferation 
C) harvest strategy 
D) limit price strategy 
E) diseconomies of scale 
A) price signaling 
B) product proliferation 
C) harvest strategy 
D) limit price strategy 
E) diseconomies of scale

In the embryonic stage of the industry life cycle,a company's investment needs and production costs are low.

Alpha corporation owns and controls several retail outlets and is pursuing a strategy called franchising.

An embryonic industry is one that:

In a declining industry,a company may utilize a harvest strategy and:

A market growth factor that explains customers' perceptions of a new product as better at satisfying their needs than the product it replaces is called:

In deciding on a strategy,a company in a declining industry must do all of the following except

Fragmented industries typically have high barriers to entry.

When a company decides to exit an industry by selling off its business assets to another company,it is said to be using a(n)_____ strategy.

Which of the following is an advantage of franchising?

One characteristic of embryonic industries is unconventional and specialized distribution channels.

Which of the following statements is true of growing industries?

Which of the following statements is true of declining industries?

___________ is a market growth factor that refers to the degree to which the results of using and enjoying a new product can be seen and appreciated by other people.

Market penetration involves the creation of new and innovative products to replace existing ones.

Which of the following is a disadvantage of franchising?

Early adopters are customers who purchase a new technology or product only when they are convinced that it will be around for a long time.

Innovators and early adopters have very different customer needs from the early majority.

Which of the following statements is true of embryonic industries?

Strategic Leadership: Managing the Strategy Making Process for Competitive Advantage

External Analysis: The Identification of Opportunities and Threats

Internal Analysis: Resources and Competitive Advantage

Building Competitive Advantage Through Functional Level Strategies

Business Level Strategy

Strategy and Technology

Strategy in the Global Environment

Corporate-Level Strategy: Horizontal Integration, Vertical Integration, and Strategic Outsourcing

Corporate Level Strategy: Related and Unrelated Diversification

Corporate Performance, Governance, and Business Ethics

Implementing Strategy Through Organization

Filters

Exam 6: Business Level Strategy and the Industry Environment

In the embryonic stage of the industry life cycle,a company's investment needs and production costs are low.

Alpha corporation owns and controls several retail outlets and is pursuing a strategy called franchising.

An embryonic industry is one that:

In a declining industry,a company may utilize a harvest strategy and:

A market growth factor that explains customers' perceptions of a new product as better at satisfying their needs than the product it replaces is called:

In deciding on a strategy,a company in a declining industry must do all of the following except

Fragmented industries typically have high barriers to entry.

When a company decides to exit an industry by selling off its business assets to another company,it is said to be using a(n)_____ strategy.

Which of the following is an advantage of franchising?

One characteristic of embryonic industries is unconventional and specialized distribution channels.

Which of the following statements is true of growing industries?

Which of the following statements is true of declining industries?

___________ is a market growth factor that refers to the degree to which the results of using and enjoying a new product can be seen and appreciated by other people.

Market penetration involves the creation of new and innovative products to replace existing ones.

Which of the following is a disadvantage of franchising?

Early adopters are customers who purchase a new technology or product only when they are convinced that it will be around for a long time.

Innovators and early adopters have very different customer needs from the early majority.

Which of the following statements is true of embryonic industries?

Strategic Leadership: Managing the Strategy Making Process for Competitive Advantage

External Analysis: The Identification of Opportunities and Threats

Internal Analysis: Resources and Competitive Advantage

Building Competitive Advantage Through Functional Level Strategies

Business Level Strategy

Strategy and Technology

Strategy in the Global Environment

Corporate-Level Strategy: Horizontal Integration, Vertical Integration, and Strategic Outsourcing

Corporate Level Strategy: Related and Unrelated Diversification

Corporate Performance, Governance, and Business Ethics

Implementing Strategy Through Organization

Filters