Question 1

As an industry enters the shakeout stage:

Accepted Answer

A)  rivalry among companies declines.
B)  demand grows at a high rate.
C)  prices of products increase.
D)  excess productive capacity emerges.
E)  new entrants come into the market. D

Question 2

When shopping for clothing such as shirts and jeans,Tyrone only buys products from Eastern Clothing Company even if there are several other companies that offer similar products at lower prices.Tyrone's preference for Eastern Clothing Company demonstrates:

Accepted Answer

A)  lack of demand.
B)  bargaining power.
C)  risk of entry.
D)  brand loyalty.
E)  lack of economies of scale D

Question 3

The extent of rivalry among established companies is lowest when:

Accepted Answer

A)  the industry's product is a commodity.
B)  demand is growing rapidly.
C)  exit barriers are substantial.
D)  the industry is entering a decline stage.
E)  the fixed costs are high. B

Question 4

Porter's Five Forces model did not recognize one force,which is:

Accepted Answer

A)  the power of complement providers.
B)  the risk of entry by potential competitors.
C)  the intensity of rivalry among established companies within an industry.
D)  the bargaining power of suppliers.
E)  the threat of substitutes.

Question 5

A group of firms manufactures writing implements such as pens,pencils,and markers.This group should be referred to as a(n):

Accepted Answer

A)  substitute.
B)  market segment.
C)  service provider.
D)  regulator.
E)  industry.

Question 6

Due to a recent relaxation in the pollution control laws by the government,Alpha Motors has reduced the production of its electric-powered cars.The company is responding to a change in which of the following macroenvironmental forces?

Accepted Answer

A)  Macroeconomic
B)  Demographic
C)  Political and legal
D)  Social
E)  Global

Question 7

Which of the following is NOT one of the factors in the economic forces of the macroenvironment?

Accepted Answer

A)  Interest rates
B)  Inflation
C)  Cultural changes
D)  Currency exchange rates
E)  Economic growth rate

Question 8

The more commodity-like that an industry's product is,the lower the intensity of any price war that may develop.

Accepted Answer

A) True 
 B)False

Question 9

Companies operating in high-technology industries are dependent on complementary products for their mutual success.

Accepted Answer

A) True 
 B)False

Question 10

Mobility barriers:

Accepted Answer

A)  allow industries to change their strategy and compete in that strategic group.
B)  inhibit the movement of companies between strategic groups in an industry.
C)  inhibit companies from shifting between suppliers for the raw materials.
D)  are factors that operate outside of an industry.
E)  exclude the barriers to entry into a group and the barriers to exit from a company's existing group.

Question 11

The punctuated equilibrium view can be described as a freezing,but not unfreezing,process in an industry's life-cycle.

Accepted Answer

A) True 
 B)False

Question 12

Julian was asked to examine the demographic forces facing his employer,a clothing manufacturer.Which of the following factors is Julian most likely to examine?

Accepted Answer

A)  Government regulations
B)  Inflation
C)  Manufacturing technology
D)  Age of the population
E)  Society's growing interest in exercise

Question 13

An impact that the changing industry boundaries have had is that:

Accepted Answer

A)  owners of companies can now define boundaries.
B)  there is an increase in the number of competitors for companies.
C)  technological changes do not affect companies anymore.
D)  the pattern of customer needs does not affect companies anymore.
E)  the number of product substitutes available for customers has reduced.

Question 14

Why is it important to understand the external environment in order to think strategically?

Accepted Answer

The answer of Why is it important to understand the...

Question 15

When the value of the dollar is low compared to the value of other currencies,products made in the United States are relatively inexpensive and products made overseas are relatively expensive.

Accepted Answer

A) True 
 B)False

Question 16

The risk of entry by potential competitors is a function of the height of the barriers to entry.

Accepted Answer

A) True 
 B)False

Question 17

Cost reductions gained through mass-producing a standardized output are a source of scale economies.

Accepted Answer

A) True 
 B)False

Question 18

To determine its opportunities and threats,a firm should focus on internal processes and capabilities.

Accepted Answer

A) True 
 B)False

Question 19

Consider the macroenvironment facing a large,international airline headquartered in the United States (such as American or United).Give at least three examples of important trends or events from each of the five segments of the airline's macroenvironment (macroeconomic,technological,demographic,social,political,and legal),and explain whether each represents a threat or an opportunity for the firm.

Accepted Answer

The answer of Consider the macroenvironment facing a large,international airline...

Question 20

Many beverage manufacturers are noticing that sales for packaged water and fruit-based beverages is increasing compared to carbonated drinks because customers are increasingly becoming health conscious.This change in customer preferences can be attributed to which of the following factors of the macroenvironment?

Accepted Answer

A)  Economic forces
B)  Demographic forces
C)  Technological forces
D)  Political forces
E)  Social forces

Exam 2: External Analysis: The Identification of Opportunities and Threats

As an industry enters the shakeout stage:

When shopping for clothing such as shirts and jeans,Tyrone only buys products from Eastern Clothing Company even if there are several other companies that offer similar products at lower prices.Tyrone's preference for Eastern Clothing Company demonstrates:

The extent of rivalry among established companies is lowest when:

Porter's Five Forces model did not recognize one force,which is:

A group of firms manufactures writing implements such as pens,pencils,and markers.This group should be referred to as a(n) :

Due to a recent relaxation in the pollution control laws by the government,Alpha Motors has reduced the production of its electric-powered cars.The company is responding to a change in which of the following macroenvironmental forces?

Which of the following is NOT one of the factors in the economic forces of the macroenvironment?

The more commodity-like that an industry's product is,the lower the intensity of any price war that may develop.

Companies operating in high-technology industries are dependent on complementary products for their mutual success.

Mobility barriers:

The punctuated equilibrium view can be described as a freezing,but not unfreezing,process in an industry's life-cycle.

Julian was asked to examine the demographic forces facing his employer,a clothing manufacturer.Which of the following factors is Julian most likely to examine?

An impact that the changing industry boundaries have had is that:

Why is it important to understand the external environment in order to think strategically?

When the value of the dollar is low compared to the value of other currencies,products made in the United States are relatively inexpensive and products made overseas are relatively expensive.

The risk of entry by potential competitors is a function of the height of the barriers to entry.

Cost reductions gained through mass-producing a standardized output are a source of scale economies.

To determine its opportunities and threats,a firm should focus on internal processes and capabilities.