Reference no: EM132720113

The growth stage of an industry's life cycle is the

Select one:

a. time when companies attempt to secure their grip over customers in existing market segments.

b. time to plan an exit strategy.

c. time when the demand for products is low because customers are not familiar with the product.

d. time when customers start exiting the markets.

e. time to reduce investment in a product.

To compete in the fragmented restaurant industry, Starbucks built, and now operates hundreds of restaurants across the United States and Canada. Which of the following strategies is Starbucks using?

Select one:

a. Acquisitions

b. Franchising

c. Licensing

d. Chaining

e. Horizontal mergers

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

Select one:

a. diseconomies of scale

b. product proliferation

c. price signaling

d. limit price strategy

e. harvest strategy

An app development firm is working on a new product to identify and consolidate a smartphone users' favorite and most used apps into one place on the phone. If the new product will be sold to existing customers, the firm is pursuing a strategy of

Select one:

a. market signaling.

b. product proliferation.

c. market development

d. market penetration.

e. product development.

Which of the following strategies allows interdependent firms indirectly to coordinate their actions?

Select one:

a. Price signaling

b. Divestment strategy

c. Harvest strategy

d. Market development

e. Market penetration

Firms sometimes pursue a chaining strategy to

Select one:

a. establish a number of unrelated business units.

b. create product diversity.

c. obtain the advantages of economies of scale.

d. spread overhead costs.

e. generate revenue by licensing the patents it owns.

Which of the following shakeout strategies requires a company to limit or decrease its investment in a business and to extract, or milk, the proceeds of its investment as much as it can?

Select one:

a. Hold-and-maintain strategy

b. Cost-leadership strategy

c. Market concentration strategy

d. Share-increasing strategy

e. Harvest strategy

Nutrimax Corp., a breakfast cereal company, has designed extensive and elaborate advertising campaigns for its existing products. The campaigns mainly focus on the features and benefits of the products that differentiate the cereals from the competition. The massive advertising and marketing initiatives are also intended to intimidate new entrants and rivals. Nutrimax Corp. is most likely to be using which of the following strategies?

Select one:

a. Product development

b. Capacity control

c. Market development

d. Market penetration

e. Product proliferation

Which of the following statements is true about fragmented industries?

Select one:

a. They are usually characterized by large mass-production operations.

b. They do not attract new entrants as they have extremely high entry barriers due to economies of scale.

c. They are usually dominated by one or two large companies that enjoy the power to influence industry prices.

d. They essentially enjoy a national brand loyalty.

e. They require companies to use focus strategies to meet specialized customer needs.

The first group of customers to enter the market for a new product are called

Select one:

a. late majority.

b. early majority.

c. innovators.

d. laggards.

e. passive shoppers.

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

Select one:

True

False

The challenge in a fragmented industry is to figure out the best set of strategies to overcome a fragmented market so that the competitive advantages associated with pursuing one of the different business models can be realized.

Select one:

True

False

The late majority customers are typically reached through specialized distribution channels, and products are often sold by word of mouth.

Select one:

True

False

Market development strategy involves finding new market segments for a company's products.

Select one:

True

False

A divestment strategy's success is often dependent upon good timing.

Select one:

True

False

Laggards are technologically sophisticated customers willing to tolerate the limitations of the product.

Select one:

True

False

Franchisees essentially pursue independent strategies and do not use the business model of the franchisor.

Select one:

True

False

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

Select one:

True

False

A leadership strategy aims at growing in a declining industry by picking up the market share of companies that are leaving the industry.

Select one:

True

False

A limit price strategy involves charging a price that is lower than that required to maximize profits in the short run, but is above the cost structure of potential entrants.

Select one:

True

False