- A highly capable brick and mortar electronics retailer with a loyal regional customer base (such as Fry’s) should adopt which of the following medium term strategies?
| | “50% off” sale every month |
| | Divest |
| | Niche or harvest |
| | Invest in R&D |
- Amazon’s strategy involves offering expanded variety but at very competitive prices. This is primarily achieved through
| | Economies of scope |
| | Focus on international markets |
| | Economies of scale |
| | Innovative products |
- Uber is an example of industry chaining in which of the following ways?
| | Economies of scale for service providers |
| | Economies of scope for customers |
| | Improving access and reduced search costs for customers and service providers |
| | Lower wages for service providers and lower prices for customers |
- Shareholder returns are primarily derived from
| | Growth in share value and dividend payments |
| | dividend payments only |
| | Growth in company profits |
| | Growth in the share value only |
- Strategy is defined best as:
| | A unique value proposition supported by sound financial decisions |
| | A unique value proposition supported by synergies in operations |
| | A unique value proposition supported by aggressive marketing |
| | A unique value proposition supported by a complex supply chain |
- The cost of attracting new customers is the highest with which of the following groups?
| | Early adopters |
| | Late majority |
| | Laggards |
| | Innovators |
- In the context of the Differentiation (Quality) vs Efficiency trade-off curve, the efficient frontier refers to:
| | The company that provides maximum quality for a given cost |
| | The company that provides minimum cost |
| | The company that provides maximum quality |
| | The company that maximizes efficiency |
- Nike hiring sports stars to be brand ambassadors is an example of which of the following mechanisms?
| | Market development |
| | Customer segmentation |
| | Product development |
| | Market penetration |
- Which of the following is an indication of strategic committment of a company in an industry
| | Lowering wages of the workforce |
| | Increased technology investment |
| | Acquiring real-estate in an urban location of demand |
| | Increased divident payments for two years in a row |
- A pharma company with a deep roster of capable engineers and scientists and that is the market leader is best advised to begin development of a new drug as:
| | A partnership with smaller competitors |
| | License its innovation from other laboratories |
| | An independent venture |
| | Smaller scale effort |
- The most valuable competency in the declining phase of an industry is:
| | Resposiveness |
| | Innovation |
| | Efficiency |
| | Quality |
- There is often limited capacity relative to demand in the early growth period of an industry because:
| | Capacity is very expensive in the later stages of an industry |
| | Only few companies have products or technologies in a budding industry |
| | Prices tend to be low in the embryonic stage |
| | Many companies compete for early advantage in an emerging industry |
- If the willingness to pay of a customer for an automobile is $18000, and the cost to produce that automobile is $14000, the consumer surplus is:
| | Less that $4000 |
| | $4000 |
| | Cannot be determined with data provided |
| | More than $4000 |
- A short term profit maximizing strategy for a monopoly would focus on:
| | Giving slightly greater surplus than the competitor |
| | Maximizing consumer surplus |
| | Minimizing consumer surplus |
| | Ensuring the lowest possible cost of the product |
- Which of the following companies best exemplifies broad cost leadership?
| | WalMart |
| | Toyota |
| | Costco |
| | Amazon |
- Tesla’s business model can be best described as:
| | Electric vehicles and services for the technology savvy drivers with advanced engineering and in-house manufacturing |
| | Electric vehicles and services for the technology savvy drivers with an outsourced model of design and manufacturing |
| | Electric vehicles and services for the technology averse drivers with advanced engineering and in-house manufacturing |
| | Electric vehicles and services for the budget conscious drivers with advanced engineering and in-house manufacturing |
- Network amplifiers are critical in establishing a standard (in a technology context) because:
| | Higher end customers have a greater voice |
| | Vertical integration is no longer a feasible option for most companies |
| | Rate of adoption is a critical factor |
| | Ease of use is paramount for any technology |
- Incumbents typically have a cost advantage as compared to new entrants becuase:
| | Incumbents typically have a technogical edge compared to new entrants |
| | Incumbents have deeper connections to government and regulatory bodies |
| | Incumbents have greater fixed costs but lower variable relative to new entrants typically |
| | Incumbent market shares lead to greater economies of scale |
- Porter’s Five forces helps with all of the following objectives except:
| | Evaluate the attractiveness of an industry |
| | Decide entry or exit from an industry |
| | Evaluate the strengths and weaknesses of a firm |
| | Evaluate opportunities and threats |
- In the context of the Differentiation (Quality) vs Efficiency trade-off curve, Amazon is best described as a company:
| | Just below and to the left of the efficient frontier |
| | On the same frontier but a different position compared to brick and mortar competitors |
| | A company that values quality over price every single day |
| | That has been a value innovator |
- Which of the following best describes a mission statement?
| | An objective for a company to be debt free in 5 years |
| | A children’s clothing store aiming to make a difference in their customer’s lives |
| | An energy company wanting to be the most sustainable company on the planet |
| | A car company wanting to change customers’ behavior into to a more sustainable lifestyle |
- According to the Mintzberg model of strategy development:
| | Most unplanned strategies lead to failures on a global scale |
| | Most realized strategies are serendipitous and in response to evolving markets |
| | Startups often engage in planning emergent strategies |
| | Most realized strategies are carefully planned and executed in advance |
- The most valuable competency in the embryonic phase of an industry is:
| | Resposiveness |
| | Efficiency |
| | Innovation |
| | Quality |
- Which of the following companies best exemplifies broad differentiation?
| | Volkswagen |
| | Amazon |
| | WalMart |
| | Costco |
- Which of the following provides longer term competitive advantage when it comes to efficiency:
| | Experience effect |
| | Economies of scale |
| | Relentless focus on lowering labor related costs |
| | Learning effect |
- An equation that best describes customer valuation is:
| | Price/Quality |
| | Quality/Procuct Price |
| | Quality/Procuct Cost |
| | Product Cost x Quality |
- The best possible context within which to apply Porter’s Five Forces model is for:
| | Market segment |
| | Industry |
| | Sector |
| | Strategic group |
- The biggest impediment to an industry’s consolidation is:
| | Lack of scale economies |
| | Lack of adequate demand |
| | Poor management |
| | Lack of skilled resources |
- The efficient frontier has a concave shape (i.e. a bulging shape) because:
| | Greater levels of efficiency come at a steep cost but only for high-end segments |
| | It costs progressively more for every increment in quality levels |
| | Quality is free at lower levels of quality |
| | There is a quadratic relationship between higher quality and efficiency |
- High-tech companies can be distinguished from low-tech companies primarily based on:
| | Level of fixed cost committment |
| | Higher price premiums for high-tech firms |
| | Extent of digital or on-line business transactions |
| | Price to earnings ratios |
- Subway restaurants is able lower variety related costs primarily through :
| | Modular design of its service |
| | Choosing franchise partners carefully |
| | Extensive franchising |
| | Allowing customers to customize their sandwich |
- Strategy formulation and execution is ultimately a service to:
| | Customers |
| | Shareholders |
| | Employees |
| | Government regulators |
- Effective marketing directly contributes to a firm’s efficiency objective by
| | Reducing the cost of serving the average customer |
| | Providing insight into customer expectations |
| | Improving the market share among higher-end customers |
| | Increasing the willingness to pay of customers |
- Which of the following companies best exemplifies focus differentiation?
- Which of the following companies best exemplifies a blue ocean strategy?
- A key feature of the cereal industry in recent years has been:
| | National as opposed to global competition |
| | Lower prices to attract customers |
| | Fewer store brand competitors |
| | Product proliferation |
- Which of the following best exemplifies a capability for a company?
| | Low price |
| | Supply chain management |
| | Financial reserves |
| | Ideal positioning |
- Absolute cost advantages for incumbents (over new entrants to an industry) typically derive from:
| | Higher levels of experience |
| | Control of inputs |
| | Economies of scale from market share |
| | All of the above |
- Amazon.com is a great example of a company that has consistently delivered:
| | Spectacular profit growth |
| | Profits year over year |
| | Above average return on investment |
| | Above average share value appreciation |
- Costco’s strategy with respect to pricing of its products and services can best be described as:
| | Ensuring the lowest total cost of the product within the market |
| | Increasing consumer surplus no matter the segment or product |
| | Reducing consumer surplus even at the expense of quality |
| | Charging higher prices to boost marginal profits |
Last Updated on March 21, 2020
