Reference no: EM133492820
Questions
1. Which of the following reduces a firm's flexibility to meet changing market demand?
a. Using a temporary work force
b. Typically operating their distribution center at half capacity
c. Using commodity products as inputs for production
d. Outsourcing the activity in their value chain to a firm with a standardized production schedule
2. Which of the following is likely to lead to stronger bargaining power for buyers?
a. Buyers are concentrated
b. Buyers can't backward integrate
c. Buyers are unaware of the prices fellow buyers are paying
d. Buyers face high switching costs
3. In an uncertain environment created by the digital transformation or the current pandemic, which of the following approaches is most likely to help a company make a sustainable competitive advantage?
a. Vertically integrating manufacturing to decrease flexibility in responding to demand
b. Building up barriers to imitation from competition
c. Tightly integrating their value chain
d. Identifying an analogy from another industry and applying it to the current industry
4. In which of the following is a firm LEAST likely to appropriate the gains from its own innovation?
a. The innovation is patentable under current U.S. patent law
b. Imitation by rivals is relatively difficult
c. Diffusion to customers of new products deriving from the innovation is quck
d. The innovation is subject to low network externalities
5. You received data from a market research firm and constructed a value curve in an attempt to develop a successful blue ocean strategy, which of the following next steps is the most likely to accomplish this goal?
a. Adding new product characteristics that your customers have indicated they want
b. Adding new product characteristics from another industry
c. Decreasing the value of current product characteristics that your customers indicated they do not like
d. Increasing the value of current product characteristics that customers indicated they like
6. Under which of the following conditions is a firm LIKELY to have acquired an asset that meets the VRI test?
a. Firm doesn't have inferior information about the value of the asset
b. Firm fortuitously acquires the asset due to some historical contingency
c. Firm purchased the asset from a firm in an industry with low competition
d. Firm doesn't have existing capabilities that make the asset more valuable to that firm
7. Vigorous domestic competition will likely a firm's competitive advantage internationally.
a. Strongly decrease
b. Increase
c. Mildly decrease
d. Do nothing for
8. If humans were only boundedly rational, but not opportunistic, which of the following approaches would be the most effective governance solution (prevents the most transaction costs for the least governance costs)?
a. Acquiring the exchange partner
b. Writing an outsourcing contract containing all possible safeguards
c. Vertically integrating the exchange
d. Writing an outsourcing contract containing a general clause agreeing to work towards both party's best interest in the case of unexpected events
9. Which of the following DECREASES the likelihood that an acquisition will be successful?
a. Engage in an alliance with the target prior to pursuing the transaction
b. Pursue friendly takeovers versus hostile takeovers
c. Finance the acquisition with equity versus debt
d. Seek firms with divergent skills and cultures
10. In which of the following is a firm with a patented technology LEAST likely to appropriate the gains from the innovation?
a. Necessary distribution networks are tightly held by a single firm (not the innovator)
b. Necessary distribution networks are characterized by intense rivalry among several players
c. Distributors are highly dependent on the technology
d. The firm may forward integrate into distribution
11. Which of the following are the reasons that transaction costs exist and must be taken into account in outsourcing decisions?
a. Monitoring and contract design
b. Bounded rationality and opportunism
c. Contract design and opportunism
d. Bounded rationality and monitoring
12. In which of the following is a firm LEAST likely to diversify?
a. When firms cannot easily differentiate in their focal market
b. When a single business firm's market share is close to 90%
c. When an expansion of capacity increases economies of scope
d. When firms seek to smooth earnings
13. You are the president of a medical device company known for its engineering capabilities that makes heart valves. You have recently read a scientific journal article that a new engineering breakthrough has the potential to make your primary heart value product obsolete. Which of the following actions are most likely to best support your firm's long-term financial health?
a. Investing a portion of your R&D budget in your firm's traditional technology to improve it and a portion of your R&D budget to develop the new engineering technology
b. Investing your R&D budget in your firm's traditional technology to continue to improve it
c. Invest your R&D budget in a new biotechnology breakthrough instead of the engineering breakthrough
d. Significantly reducing investments in all R&D
14. Being a first-mover may provide a competitive advantage in all EXCEPT which of the following?
a. When you can establish a leading brand
b. When there are significant learning curve effects
c. When the minimum efficient scale is low
d. When you can establish precommitment contracts with your suppliers
15. Resources and capabilities are unable to provide a sustainable competitive advantage if they...
a. Provide a higher willingness to pay for customers
b. Are in the form of a new patented drug
c. Are widely shared and available in the industry
d. Reflect a tight strategic fit among firm activities
16. A HHI of .9 means ____________ than an HHI of .5.
a. Less synergy
b. Less diversification
c. Greater synergy
d. Greater diversification
17. On average, M&A deals generate
a. Highly positive return
b. Highly negative return
c. Zero return
d. Positive return
18. A learning curve of .85 means ____________ than a learning curve of .95.
a. More learning
b. Smaller slope (beta coefficient in learning curve formula)
c. Higher cumulative production
d. More synergy
19. An activity in a firm's value chain should be outsourced if which of the following is TRUE:
a. There is a cost advantage of outsourcing, it is not a core activity and transaction costs are high
b. There is a cost advantage of vertical integration, it is a core activity and transaction costs are low.
c. There is a cost advantage of vertical integration, it is not a core activity and transaction costs are low.
d. There is a cost advantage of outsourcing, it is not a core activity and transaction costs are low
20. In S-curve analysis, which of the following is a key success factor in the growth phase?
a. Standardization
b. Industry consolidation
c. Process innovation
d. Sales capabilities