Final Business Strategy Test Bank Chapter 6

Chapter 6: Business Strategy

Test Bank

Type: true-false

Title: Chapter 06 Question 01

1) Mobile phone handset manufacturers and producers of the mobile phone infrastructure are in the same industry.

a. True

b. False

Type: multiple response question

Title: Chapter 06 Question 02

2) Which of the following issues would be a concern of competitive strategy? Please select all that apply.

Type: multiple response question

Type: multiple choice question

Title: Chapter 06 Question 04

4) Generic strategy models can be used to: Please select all that apply.

a. Describe different theoretical ways of competing in a particular market

b. Ascertain which strategies are best or worst

c. Predict future performance of a firm

d. Ascertain how to achieve low cost or differentiation

Type: fill-in-blank

Title: Chapter 06 Question 05

5) Porter’s generic strategies can be defined as cost leadership, differentiation, and _____________________.

Type: fill-in-blank

Title: Chapter 06 Question 06

6) Porter suggests that firms can only achieve high returns if their costs are lower than those of competitors or if they can _____________ their products effectively.

Type: fill-in-blank

Title: Chapter 06 Question 07

7) The business strategy that allows an organization to target a segment or niche within the market is ____________ strategy.

Type: multiple response question

Title: Chapter 06 Question 08

8) A hybrid strategy involves a combination of:

Type: multiple choice question

Title: Chapter 06 Question 09

9) A firm produces 100 units at a cost of £10 per unit. According to the experience curve effect, if the firm produces 200 units, how much would each unit cost to produce?

a. £7-£8

b. £5-£6

c. £8-£9

d. £4-£5

Type: true-false

Title: Chapter 06 Question 10

10) Ryanair will be in a better position than its competitors to counter substitutes such as the ferry and Eurotunnel, given its superior price–performance ratio.

a. True

b. False

Type: true-false

Title: Chapter 06 Question 11

11) A differentiation strategy must be based on something tangible.

a. True

b. False

Type: multiple response question

Title: Chapter 06 Question 12

12) Risks of following a differentiation strategy:

Type: fill-in-blank

Title: Chapter 06 Question 13

13) According to Porter, if an organization does not follow either a cost reduction strategy or a differentiation strategy, they are______________.

Type: true-false

Title: Chapter 06 Question 14

14) Generic strategy frameworks present a static view of a firm.

a. True

b. False

Type: multiple choice question

Title: Chapter 06 Question 15

15) A hybrid strategy involves a combination of:

a. differentiation based on tangible and intangible aspects.

b. low costs and differentiation.

c. differentiation based on product design and process design.

d. low costs and low prices.

Type: fill-in-blank

Title: Chapter 06 Question 16

16) Some authors believe that no generic strategy can by itself be an enduring source of competitive advantage. Instead, they believe that competitive advantage comes from strategic resources and architecture. These authors are proponents of the _________________.

Type: multiple choice question

Title: Chapter 06 Question 17

17) Generic competitive strategies are seen as being part of:

a. The resource-based view of the firm

b. The inside-out approach

c. The positioning approach

d. Porter’s Diamond

Type: fill-in-blank

Title: Chapter 06 Question 18

18) The aim of the resource-based approach to strategy formulation is to maximize ______________ rents.

Type: multiple choice question

Title: Chapter 06 Question 19

19) ‘Durability’ of resources refers to:

a. The extent to which a competitor can access the same resources

b. The extent to which a competitor understands the reason for competitive advantage

c. The rate at which they depreciate or become obsolete

d. The extent to which capabilities can be imitated

Type: multiple response question

Title: Chapter 06 Question 20

20) Grant and Jordan’s (2015) four stages model to guide organizations in their strategy formulation are: stage one is to identify and classify the firm’s resources; stage two is to Identify the firm’s capabilities; stage three is to appraise the rent-generating potential of resources and capabilities; stage four is to select a strategy which best exploits the firm’s resources and capabilities relative to external opportunities.

Type: fill-in-blank

Title: Chapter 06 Question 21

21) Regarding generic strategies, Kay (1993:368) argues that ‘there can be no such recipes because their value would be destroyed by the very fact of their ________________’.

Type: fill-in-blank

Title: Chapter 06 Question 22

22) Kim and Mauborgne (2005) argue that organizations need to create and capture uncontested market space. They refer to this uncontested market space as ______________.

Type: multiple response question

Title: Chapter 06 Question 23

23) Value innovation is the key to creating blue oceans. Please select all that are true.

Type: multiple response question

Type: multiple response question

Type: multiple choice question

Title: Chapter 06 Question 26

26) D’Aveni (1999) describes industries in terms of how turbulent they are. The four different degrees of turbulence are described as equilibrium, fluctuating equilibrium, punctuated equilibrium, and:

a. Dynamic-equilibrium.

b. Hyper-equilibrium.

c. Anti-equilibrium.

d. Disequilibrium.

Type: multiple response question

Title: Chapter 06 Question 27

27) In the disruptive innovation, a smaller company with fewer resources is able to successfully challenge established incumbent businesses because the smaller company: Select all that apply.

Type: true-false

Title: Chapter 06 Question 28

28) Entrant’s disruptive strategy is positioned in the low end of the market.

a. True

b. False

Type: true-false

Title: Chapter 06 Question 29

29) The disruptive theory differentiates disruptive innovation from sustaining innovations.

a. True

b. False

Type: multiple response question

Title: Chapter 06 Question 30

30) Limitations of disruptive innovation include: Please select all that apply.