Question 1

A firm's mission tends to be enduring while its vision can change in light of changing environmental conditions.

Accepted Answer

A) True 
 B)False

Question 2

What are a firm's vision and mission? What is the value to the firm of having a specified vision and mission?

Accepted Answer

The answer of What are a firm's vision and mission?...

Question 3

Describe the industrial organization (I/O) model of above-average returns.What are its main assumptions? What is the key to success according to the I/O model?

Accepted Answer

The answer of Describe the industrial organization (I/O) model of...

Question 4

Organizational stakeholders are usually satisfied when:

Accepted Answer

A)  their return on investment has been maximized. 
B)  customers pay the highest sustainable price for the goods and services they receive. 
C)  companies provide a dynamic, stimulating, and rewarding work environment. 
D)  companies are paying the highest prices to suppliers.

Question 5

To implement a firm's strategies, the firm takes actions to enact each strategy with the intent of achieving strategic competitiveness and above-average returns.

Accepted Answer

A) True 
 B)False

Question 6

The industrial organization (I/O) model suggests that above-average returns are determined primarily by the firm's unique internal resources rather than by external capabilities.

Accepted Answer

A) True 
 B)False

Question 7

Companies searching for opportunities in the global economy would likely conclude that the three leading European economies of Germany, United Kingdom, and France would be good investments because they are predicted to continue increasing in size.

Accepted Answer

A) True 
 B)False

Question 8

The five forces model suggests that firms should target the industry with the highest potential for above-average returns and then implement either a cost-leadership strategy or a differentiation strategy.

Accepted Answer

A) True 
 B)False

Question 9

RelTech has developed a proprietary approach to supply chain management and uses that expertise as a source of competitive advantage.RelTech is relying on what intangible asset as a basis of competition?

Accepted Answer

A)  Knowledge 
B)  Insight 
C)  Intensity 
D)  Strategic flexibility

Question 10

Jan is the CEO of GlenOak Corp.After analyzing GlenOak's vision statement and aligning it with new environmental conditions, Jan rewrote GlenOak's mission.Which of the following best characterizes Jan's action?

Accepted Answer

A)  Jan should have involved managers at all levels in the firm as well as employees who interact with customers and the markets for input when rewriting the mission statement. 
B)  Because a mission can change along with environmental circumstances, Jan did the right thing in rewriting the mission. 
C)  Because the CEO has the final responsibility for forming a firm's mission, it was proper for Jan to rewrite the mission statement. 
D)  A mission statement is an enduring reflection of the values and aspirations of a firm, and Jan should not have rewritten it.

Question 11

Firms use the five forces model of competition to identify the __________ of an industry, as measured by its __________.

Accepted Answer

A)  size; number of competitors 
B)  globalization; percentage of exports 
C)  hypercompetition; technology diffusion 
D)  attractiveness; profitability potential

Question 12

PGG Mining is making a strategic decision whether to shut down a coal mine in Pennsylvania.It is important to consider that the decision:

Accepted Answer

A)  should be based solely on the results of the CEO's approval of the mine's general manager. 
B)  has ethical implications for organizational stakeholders. 
C)  need not be socially responsible if the firm is making below-average returns from the mine. 
D)  All of these are important to consider.

Question 13

Six years ago, Colette Smith founded a successful catering company that specializes in providing a wide assortment of miniature cheesecakes for corporate and social events.Although Ms.Smith is no longer active in the actual production of the cheesecakes, she continues as president of the catering company.Ms.Smith could be considered a strategic leader of this firm.

Accepted Answer

A) True 
 B)False

Question 14

A competitive advantage:

Accepted Answer

A)  can be permanent if the firm has successfully implemented the strategic management process. 
B)  entails reducing investors' risk to near zero. 
C)  can be identified when competitors are unable to duplicate a strategy or find it too costly to try to imitate. 
D)  exists when competing firms are unable to find investors.

Question 15

Examples of incremental innovations include iPads, Wi-Fi, and the web browser.

Accepted Answer

A) True 
 B)False

Question 16

A company's ability to acquire knowledge is:

Accepted Answer

A)  less important in the twenty-first century than in previous periods of business history. 
B)  an increasingly valuable source of competitive advantage. 
C)  not considered an asset or resource for businesses. 
D)  only important in high-technology industries.

Question 17

Alligator Enterprises has earned above-average returns since its founding five years ago.No other firm has challenged Alligator in its particular market niche; therefore, the firm's owners can feel secure that Alligator has established a competitive advantage.

Accepted Answer

A) True 
 B)False

Question 18

Strategic leaders are:

Accepted Answer

A)  located only at the executive level. 
B)  located in different areas and levels. 
C)  the CEO, COO, and CFO only. 
D)  located at different levels, but only in the operating area of the organization.

Question 19

The culmination of the strategic management process is:

Accepted Answer

A)  performance. 
B)  strategy implementation. 
C)  strategy formulation. 
D)  analysis.

Question 20

The resource-based model argues that:

Accepted Answer

A)  all resources have the potential to be the basis of sustainable competitive advantage. 
B)  resources alone can be a source of sustainable competitive advantage. 
C)  the key to competitive success is the structure of the industry in which the firm competes. 
D)  resources that are valuable, rare, costly to imitate, and non-substitutable form the basis of a firm's core competencies.

Exam 1: Strategic Management and Strategic Competitiveness

A firm's mission tends to be enduring while its vision can change in light of changing environmental conditions.

What are a firm's vision and mission? What is the value to the firm of having a specified vision and mission?

Describe the industrial organization (I/O) model of above-average returns.What are its main assumptions? What is the key to success according to the I/O model?

Organizational stakeholders are usually satisfied when:

To implement a firm's strategies, the firm takes actions to enact each strategy with the intent of achieving strategic competitiveness and above-average returns.

The industrial organization (I/O) model suggests that above-average returns are determined primarily by the firm's unique internal resources rather than by external capabilities.

Companies searching for opportunities in the global economy would likely conclude that the three leading European economies of Germany, United Kingdom, and France would be good investments because they are predicted to continue increasing in size.

The five forces model suggests that firms should target the industry with the highest potential for above-average returns and then implement either a cost-leadership strategy or a differentiation strategy.

RelTech has developed a proprietary approach to supply chain management and uses that expertise as a source of competitive advantage.RelTech is relying on what intangible asset as a basis of competition?

Jan is the CEO of GlenOak Corp.After analyzing GlenOak's vision statement and aligning it with new environmental conditions, Jan rewrote GlenOak's mission.Which of the following best characterizes Jan's action?

Firms use the five forces model of competition to identify the of an industry, as measured by its .

PGG Mining is making a strategic decision whether to shut down a coal mine in Pennsylvania.It is important to consider that the decision:

A competitive advantage:

Examples of incremental innovations include iPads, Wi-Fi, and the web browser.

A company's ability to acquire knowledge is:

Alligator Enterprises has earned above-average returns since its founding five years ago.No other firm has challenged Alligator in its particular market niche; therefore, the firm's owners can feel secure that Alligator has established a competitive advantage.

Strategic leaders are:

The culmination of the strategic management process is:

The resource-based model argues that: