Question 1

According to Chapter 5,which of the following firms could have benefited from the values contained in the triple bottom line?

Accepted Answer

A)   BMW
B)   BP
C)   Interface, Inc.
D)   GoogleE) B) and C)
F) A) and D)

Question 2

When a firm evaluates its performance utilizing metrics such as the balanced-scorecard approach or accounting measurements,it should interpret the results relative to its competitors,not against its own past performance.

Accepted Answer

A) True 
 B)False

Question 3

Firm competitive performance can be best judged by:

Accepted Answer

A)   Internal performance metrics of the firm.
B)   Past performance of the firm.
C)   Comparisons to rivals and the industry.
D)   External performance metrics of the firm.E) B) and D)
F) All of the above

Question 4

When using accounting profitability data to assess competitive advantage,it is important to make comparisons across different industries.

Accepted Answer

A) True 
 B)False

Question 5

When a firm assesses its performance by asking questions such as "How do our customers view us?" and "What core competencies do we need?",it is using which tool?

Accepted Answer

A)   The strategy map
B)   The triple bottom line
C)   The balanced scorecard
D)   A PESTEL analysisE) B) and C)
F) A) and B)

Question 6

An assessment tool that takes a multidimensional approach to evaluating a firm's competitive position by utilizing specific questions and performance metrics is:

Accepted Answer

A)   The comprehensive scorecard
B)   The shareholder scorecard
C)   The balanced scorecard
D)   The strategic scorecardE) B) and C)
F) A) and B)

Question 7

As noted in Chapter 5,Microsoft is many times larger than Google and records higher net income,return on assets,and return on equity in absolute terms when it comes to accounting profitability.However,when looking at normalized stock returns,Google has outperformed both Microsoft and the NASDAQ-100 index by a wide margin over the 2005-2010 time period.Suppose you were a manager for Microsoft.Evaluating this information would tell you that:

Accepted Answer

A)   Microsoft has a sustained competitive advantage from a shareholder value creation framework.
B)   Google has a sustained competitive advantage from a shareholder value creation framework.
C)   Both Microsoft and Google have sustained competitive advantages from a shareholder value creation framework.
D)   Google has a competitive disadvantage from a shareholder value creation framework.E) C) and D)
F) A) and B)

Question 8

All of the following statements are TRUE about strategy EXCEPT:

Accepted Answer

A)   There is no single best strategy; only strategies that are better than that of rivals.
B)   A strategy that has provided competitive advantages in the past will most likely do so in the future.
C)   Strategy must integrate and align each business unit.
D)   Performance metrics that measure effectiveness must aggregate upward and reflect overall company performance.E) A) and C)
F) All of the above

Question 9

Using either the accounting profitability or shareholder value creation approach to determine whether Microsoft or Google have competitive advantage(s) is complicated by the fact that:

Accepted Answer

A)   The key to their performance is based on intangible assets.
B)   The technology sector is difficult to evaluate.
C)   One-dimensional approaches reveal the best information.
D)   They have no tangible assets.E) B) and C)
F) None of the above

Question 10

As discussed in Chapter 5,the chemical manufacturer FMC Corporation overcame short-term thinking and underperforming business units by adopting a balanced-scorecard approach.All of the following are true about FMC's successful implementation of a balanced scorecard EXCEPT:

Accepted Answer

A)   Managers could focus on new-product introductions.
B)   Managers were able to formulate new strategies.
C)   Managers could focus on core competencies within each division.
D)   Managers were able to align different perspectives to create a more overall focus.E) A) and C)
F) A) and B)

Question 11

Measuring how a customer views a firm under the balanced-scorecard framework is important because:

Accepted Answer

A)   Customer perspective is directly linked to firm revenues and profits.
B)   The customer viewpoint tells a firm much needed information about rivals.
C)   Surveying customers makes them feel important to the firm.
D)   It is a good indicator of future stock price.E) A) and B)
F) A) and C)

Question 12

An important question to ask when looking at differences in firm performance and competitive advantage is how to best measure these differences.

Accepted Answer

A) True 
 B)False

Question 13

The types of assets that are the primary focus of accounting data but are no longer most important to competitive advantage are:

Accepted Answer

A)   Intangible.
B)   Tangible.
C)   Indefinable.
D)   Unobserved.E) None of the above
F) B) and C)

Question 14

Total return to shareholders includes stock price appreciation and is an __________ measurement that reflects how the market views a firm's competitive position.

Accepted Answer

A)   Internal
B)   External
C)   Intangible
D)   IntegratedE) C) and D)
F) All of the above

Question 15

Return on invested capital,return on equity,return on revenue,and _____________ are the profitability metrics that are commonly used by a firm in the quest for competitive advantage.

Accepted Answer

A)   Return on surplus
B)   Return on assets
C)   Return on value
D)   Return on productionE) A) and B)
F) A) and C)

Question 16

When the value that a customer attaches to a good or service exceeds the price paid for the good or service,this is a(n) :

Accepted Answer

A)   Economic surplus.
B)   Consumer surplus.
C)   Value surplus.
D)   Consumer value.E) C) and D)
F) B) and C)

Question 17

Macroeconomic factors such as the unemployment rate and economic contraction:

Accepted Answer

A)   Minimize stock price volatility.
B)   Are irrelevant to shareholder value creation.
C)   Have a direct bearing on a firm's stock price.
D)   Help shareholders evaluate whether a firm's strategy is working.E) None of the above
F) B) and C)

Question 18

Which of the following is TRUE concerning the balanced scorecard?

Accepted Answer

A)   It is useful when formulating strategy, not when implementing it.
B)   It does not provide any insight on how to correct a problem once a firm deviates from its goals.
C)   It is superior to the triple bottom line when it comes to a holistic approach to competitive advantage(s) .
D)   It monitors and reports how balanced a firm's investment portfolio is.E) B) and D)
F) None of the above

Question 19

Shareholders are most concerned with _____________ when it comes to measuring a firm's competitive advantage.

Accepted Answer

A)   Value creation
B)   Global expansion
C)   Return on risk capital
D)   Market shareE) None of the above
F) B) and D)

Question 20

Under the shareholder value creation framework,______________ makes it difficult to evaluate firm performance,particularly in the short term.

Accepted Answer

A)   Internal volatility
B)   Stock market volatility
C)   Value chain volatility
D)   Supplier volatilityE) A) and B)
F) C) and D)

Exam 5: Competitive Advantage and Firm Performance

Using either the accounting profitability or shareholder value creation approach to determine whether Microsoft or Google have competitive advantage(s) is complicated by the fact that:

Correct Answer
verified

Firm competitive performance can be best judged by:

Correct Answer
verified

Macroeconomic factors such as the unemployment rate and economic contraction:

Correct Answer
verified

Which of the following is TRUE concerning the balanced scorecard?

Correct Answer
verified

As discussed in Chapter 5,the chemical manufacturer FMC Corporation overcame short-term thinking and underperforming business units by adopting a balanced-scorecard approach.All of the following are true about FMC's successful implementation of a balanced scorecard EXCEPT:

Correct Answer
verified

When using accounting profitability data to assess competitive advantage,it is important to make comparisons across different industries.

Correct Answer
verified

Return on invested capital,return on equity,return on revenue,and _____________ are the profitability metrics that are commonly used by a firm in the quest for competitive advantage.

Correct Answer
verified

The types of assets that are the primary focus of accounting data but are no longer most important to competitive advantage are:

Correct Answer
verified

Correct Answer
verified

All of the following statements are TRUE about strategy EXCEPT:

Correct Answer
verified

Under the shareholder value creation framework,______________ makes it difficult to evaluate firm performance,particularly in the short term.

Correct Answer
verified

Measuring how a customer views a firm under the balanced-scorecard framework is important because:

Correct Answer
verified

According to Chapter 5,which of the following firms could have benefited from the values contained in the triple bottom line?

Correct Answer
verified

When a firm assesses its performance by asking questions such as "How do our customers view us?" and "What core competencies do we need?",it is using which tool?

Correct Answer
verified

An assessment tool that takes a multidimensional approach to evaluating a firm's competitive position by utilizing specific questions and performance metrics is:

Correct Answer
verified

Total return to shareholders includes stock price appreciation and is an __________ measurement that reflects how the market views a firm's competitive position.

Correct Answer
verified

When the value that a customer attaches to a good or service exceeds the price paid for the good or service,this is a(n) :

Correct Answer
verified

When a firm evaluates its performance utilizing metrics such as the balanced-scorecard approach or accounting measurements,it should interpret the results relative to its competitors,not against its own past performance.

Correct Answer
verified

An important question to ask when looking at differences in firm performance and competitive advantage is how to best measure these differences.

Correct Answer
verified

Shareholders are most concerned with _____________ when it comes to measuring a firm's competitive advantage.

Correct Answer
verified

Exam 5: Competitive Advantage and Firm Performance

Using either the accounting profitability or shareholder value creation approach to determine whether Microsoft or Google have competitive advantage(s) is complicated by the fact that:

Correct AnswerverifiedShow Answer

Firm competitive performance can be best judged by:

Correct AnswerverifiedShow Answer

Macroeconomic factors such as the unemployment rate and economic contraction:

Correct AnswerverifiedShow Answer

Which of the following is TRUE concerning the balanced scorecard?

Correct AnswerverifiedShow Answer

As discussed in Chapter 5,the chemical manufacturer FMC Corporation overcame short-term thinking and underperforming business units by adopting a balanced-scorecard approach.All of the following are true about FMC's successful implementation of a balanced scorecard EXCEPT:

Correct AnswerverifiedShow Answer

When using accounting profitability data to assess competitive advantage,it is important to make comparisons across different industries.

Correct AnswerverifiedShow Answer

Return on invested capital,return on equity,return on revenue,and _____________ are the profitability metrics that are commonly used by a firm in the quest for competitive advantage.

Correct AnswerverifiedShow Answer

The types of assets that are the primary focus of accounting data but are no longer most important to competitive advantage are:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

All of the following statements are TRUE about strategy EXCEPT:

Correct AnswerverifiedShow Answer

Under the shareholder value creation framework,______________ makes it difficult to evaluate firm performance,particularly in the short term.

Correct AnswerverifiedShow Answer

Measuring how a customer views a firm under the balanced-scorecard framework is important because:

Correct AnswerverifiedShow Answer

According to Chapter 5,which of the following firms could have benefited from the values contained in the triple bottom line?

Correct AnswerverifiedShow Answer

When a firm assesses its performance by asking questions such as "How do our customers view us?" and "What core competencies do we need?",it is using which tool?

Correct AnswerverifiedShow Answer

An assessment tool that takes a multidimensional approach to evaluating a firm's competitive position by utilizing specific questions and performance metrics is:

Correct AnswerverifiedShow Answer

Total return to shareholders includes stock price appreciation and is an __________ measurement that reflects how the market views a firm's competitive position.

Correct AnswerverifiedShow Answer

When the value that a customer attaches to a good or service exceeds the price paid for the good or service,this is a(n) :

Correct AnswerverifiedShow Answer

When a firm evaluates its performance utilizing metrics such as the balanced-scorecard approach or accounting measurements,it should interpret the results relative to its competitors,not against its own past performance.

Correct AnswerverifiedShow Answer

An important question to ask when looking at differences in firm performance and competitive advantage is how to best measure these differences.

Correct AnswerverifiedShow Answer

Shareholders are most concerned with _____________ when it comes to measuring a firm's competitive advantage.

Correct AnswerverifiedShow Answer

Correct Answer
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