Question 1

A market that mainly competes on the basis of price and has stagnant growth is characteristic of what life cycle stage?

Accepted Answer

A)   introduction
B)   growth
C)   maturity
D)   declineE) A) and C)
F) B) and C)

Question 2

Zulily,an online retailer,competes with Amazon and other online retailers by

Accepted Answer

A)   maintaining a large inventory of products.
B)   running a labor-intensive distribution system.
C)   ordering products from vendors to keep in stock until a customer order comes in.
D)   keeping little inventory and ordering only when customers purchase a product.E) All of the above
F) A) and B)

Question 3

At one CVS drugstore,a four-pack of Energizer AA batteries was on sale at 2.99 USD compared with a Duracell four-pack at 4.59 USD.The Duracell market share dropped 2 percent in a recent two-year period,and its profits declined over 30 percent.Why did this happen?

Accepted Answer

A)   The price differential was too high.
B)   The market for batteries is saturated.
C)   The customer perceived the products to be different.
D)   There are valid alternatives for batteries.E) All of the above
F) None of the above

Question 4

Discuss how each stage of the industry life cycle (introduction,growth,maturity,and decline)can play a role in decisions that managers must make at the business level.Provide an example for each stage.

Accepted Answer

The industry life cycle refers to the st...

Question 5

One aspect of using a cost leadership strategy is that experience effects may lead to lower costs.Experience effects are achieved by

Accepted Answer

A)   spreading out a given expense or investment over a greater volume.
B)   hiring more experienced personnel.
C)   repeating a process until a task becomes easier.
D)   competing in an industry for a long time.E) C) and D)
F) B) and D)

Question 6

In the ________ stage of the industry life cycle,there are few segments,the emphasis on process design is low,and the major functional areas of concern are general management and finance.

Accepted Answer

A)   introduction
B)   growth
C)   decline
D)   maturityE) A) and B)
F) C) and D)

Question 7

A differentiation strategy enables a business to address the five competitive forces by

Accepted Answer

A)   having brand-loyal customers become more sensitive to prices.
B)   increasing economies of scale.
C)   providing protection against rivalry.
D)   serving a broader market segment.E) B) and C)
F) All of the above

Question 8

Which of the following is not a potential pitfall of a focus strategy?

Accepted Answer

A)   Erosion of cost advantages can arise within the narrow segment.
B)   Product/service offerings that are highly focused are subject to competition from new entrants.
C)   Focusers can become too focused to satisfy buyer needs.
D)   All rivals share a common input or raw material.E) A) and B)
F) A) and D)

Question 9

In the ________ stage of the industry life cycle,the emphasis on product design is very high,the intensity of competition is low,and the market growth rate is low.

Accepted Answer

A)   growth
B)   maturity
C)   introduction
D)   declineE) C) and D)
F) None of the above

Question 10

Company competitive advantages can be eroded by all the following except

Accepted Answer

A)   rapid changes in technology.
B)   globalization.
C)   actions by rivals within the industry.
D)   actions by workers outside of the industry.E) None of the above
F) A) and D)

Question 11

A business that strives for a low-cost advantage must attain a(n) ________ cost advantage over rivals.

Accepted Answer

A)   relative
B)   evolutionary
C)   absolute
D)   potentialE) All of the above
F) A) and B)

Question 12

Which type of competitive strategy is characterized by convincing rivals not to enter a price war,protection from customer pressure to lower prices,and the ability to better withstand cost increases from suppliers?

Accepted Answer

A)   differentiation
B)   overall low-cost leadership
C)   differentiation focus
D)   cost leadership focusE) A) and B)
F) A) and C)

Question 13

A pitfall of integrated overall cost leadership and differentiation is underestimating the expenses associated with coordinating value-creating activities in the extended value chain.

Accepted Answer

A) True 
 B)False

Question 14

Atlas Door created competitive advantage by reducing the time to receive and process an order and through installing a just-in-time logistics operation.Which of the following is not a reason for their favorable position relative to the five forces of industry competition?

Accepted Answer

A)   The service was easily imitable.
B)   It created high entry barriers for new entrants.
C)   The integration of many company value-chain activities provided causal ambiguity and path dependency.
D)   It exerted power over its customers.E) A) and B)
F) C) and D)

Question 15

Aldi,a discount supermarket retailer,has grown from its German base to the rest of Europe,Australia,and the United States by replicating a simple business format.Aldi limits the number of products in each category to ensure product turn,to ease stocking shelves,and to increase its power over supplier.This is an example of an overall cost leadership strategy because it

Accepted Answer

A)   gives them competitive advantage by decreasing productivity.
B)   gives them competitive advantage by tight cost and overhead control.
C)   eliminates the need to compete based on its products.
D)   requires the customer to recognize its efforts.E) All of the above
F) A) and C)

Question 16

Research has consistently shown that firms that achieve both cost leadership and differentiation advantages tend to perform

Accepted Answer

A)   at about the same level as firms that achieve either cost or differentiation advantages.
B)   about the same as firms that are stuck-in-the-middle.
C)   higher than firms that achieve either a cost or a differentiation advantage.
D)   lower than firms that achieve differentiation advantages but higher than firms that achieve cost advantages.E) A) and D)
F) A) and C)

Question 17

A ________ can be defined as the total profits in an industry at all points along the industry value chain.

Accepted Answer

A)   profit maximizer
B)   revenue enhancer
C)   profit pool
D)   profit outsourcingE) All of the above
F) A) and B)

Question 18

Factors that lead to a low-cost position also provide substantial entry barriers to substitute and new products as is demonstrated by the retailer,Aldi,whose focus on minimizing costs across the entire operation permits it to position well against competitors such as Walmart.

Accepted Answer

A) True 
 B)False

Question 19

The text discusses three approaches to combining overall cost leadership and differentiation competitive advantages.Which of the following is not one of these three approaches?

Accepted Answer

A)   automated and flexible manufacturing systems
B)   deriving benefits from highly-focused and high-technology markets
C)   exploiting the profit pool concept for competitive advantage
D)   coordinating the extended value chain by way of information technologyE) A) and B)
F) B) and C)

Question 20

Barnes and Noble lost its market share in book retailing to Amazon.It tried to regain market share by offering a similar electronic reader,the Nook,to the Amazon Kindle series.This demonstrates that Barnes and Noble lacked

Accepted Answer

A)   a short-term strategy.
B)   a company-wide strategy.
C)   a sustainable competitive advantage.
D)   good suppliers.E) B) and C)
F) None of the above

Exam 5: Business-level Strategy: Creating and Sustaining Competitive Advantages

A ________ can be defined as the total profits in an industry at all points along the industry value chain.

Correct Answer
verified

In the ________ stage of the industry life cycle,the emphasis on product design is very high,the intensity of competition is low,and the market growth rate is low.

Correct Answer
verified

A market that mainly competes on the basis of price and has stagnant growth is characteristic of what life cycle stage?

Correct Answer
verified

At one CVS drugstore,a four-pack of Energizer AA batteries was on sale at 2.99 USD compared with a Duracell four-pack at 4.59 USD.The Duracell market share dropped 2 percent in a recent two-year period,and its profits declined over 30 percent.Why did this happen?

Correct Answer
verified

A differentiation strategy enables a business to address the five competitive forces by

Correct Answer
verified

Research has consistently shown that firms that achieve both cost leadership and differentiation advantages tend to perform

Correct Answer
verified

Barnes and Noble lost its market share in book retailing to Amazon.It tried to regain market share by offering a similar electronic reader,the Nook,to the Amazon Kindle series.This demonstrates that Barnes and Noble lacked

Correct Answer
verified

Which type of competitive strategy is characterized by convincing rivals not to enter a price war,protection from customer pressure to lower prices,and the ability to better withstand cost increases from suppliers?

Correct Answer
verified

Factors that lead to a low-cost position also provide substantial entry barriers to substitute and new products as is demonstrated by the retailer,Aldi,whose focus on minimizing costs across the entire operation permits it to position well against competitors such as Walmart.

Correct Answer
verified

Zulily,an online retailer,competes with Amazon and other online retailers by

Correct Answer
verified

Correct Answer
verified

Company competitive advantages can be eroded by all the following except

Correct Answer
verified

A business that strives for a low-cost advantage must attain a(n) ________ cost advantage over rivals.

Correct Answer
verified

In the ________ stage of the industry life cycle,there are few segments,the emphasis on process design is low,and the major functional areas of concern are general management and finance.

Correct Answer
verified

The text discusses three approaches to combining overall cost leadership and differentiation competitive advantages.Which of the following is not one of these three approaches?

Correct Answer
verified

Which of the following is not a potential pitfall of a focus strategy?

Correct Answer
verified

Discuss how each stage of the industry life cycle (introduction,growth,maturity,and decline)can play a role in decisions that managers must make at the business level.Provide an example for each stage.

Correct Answer
verified
The industry life cycle refers to the st...
View Answer

One aspect of using a cost leadership strategy is that experience effects may lead to lower costs.Experience effects are achieved by

Correct Answer
verified

Atlas Door created competitive advantage by reducing the time to receive and process an order and through installing a just-in-time logistics operation.Which of the following is not a reason for their favorable position relative to the five forces of industry competition?

Correct Answer
verified

A pitfall of integrated overall cost leadership and differentiation is underestimating the expenses associated with coordinating value-creating activities in the extended value chain.

Correct Answer
verified

Exam 5: Business-level Strategy: Creating and Sustaining Competitive Advantages

A ________ can be defined as the total profits in an industry at all points along the industry value chain.

Correct AnswerverifiedShow Answer

In the ________ stage of the industry life cycle,the emphasis on product design is very high,the intensity of competition is low,and the market growth rate is low.

Correct AnswerverifiedShow Answer

A market that mainly competes on the basis of price and has stagnant growth is characteristic of what life cycle stage?

Correct AnswerverifiedShow Answer

At one CVS drugstore,a four-pack of Energizer AA batteries was on sale at 2.99 USD compared with a Duracell four-pack at 4.59 USD.The Duracell market share dropped 2 percent in a recent two-year period,and its profits declined over 30 percent.Why did this happen?

Correct AnswerverifiedShow Answer

A differentiation strategy enables a business to address the five competitive forces by

Correct AnswerverifiedShow Answer

Research has consistently shown that firms that achieve both cost leadership and differentiation advantages tend to perform

Correct AnswerverifiedShow Answer

Barnes and Noble lost its market share in book retailing to Amazon.It tried to regain market share by offering a similar electronic reader,the Nook,to the Amazon Kindle series.This demonstrates that Barnes and Noble lacked

Correct AnswerverifiedShow Answer

Which type of competitive strategy is characterized by convincing rivals not to enter a price war,protection from customer pressure to lower prices,and the ability to better withstand cost increases from suppliers?

Correct AnswerverifiedShow Answer

Factors that lead to a low-cost position also provide substantial entry barriers to substitute and new products as is demonstrated by the retailer,Aldi,whose focus on minimizing costs across the entire operation permits it to position well against competitors such as Walmart.

Correct AnswerverifiedShow Answer

Zulily,an online retailer,competes with Amazon and other online retailers by

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Company competitive advantages can be eroded by all the following except

Correct AnswerverifiedShow Answer

A business that strives for a low-cost advantage must attain a(n) ________ cost advantage over rivals.

Correct AnswerverifiedShow Answer

In the ________ stage of the industry life cycle,there are few segments,the emphasis on process design is low,and the major functional areas of concern are general management and finance.

Correct AnswerverifiedShow Answer

The text discusses three approaches to combining overall cost leadership and differentiation competitive advantages.Which of the following is not one of these three approaches?

Correct AnswerverifiedShow Answer

Which of the following is not a potential pitfall of a focus strategy?

Correct AnswerverifiedShow Answer

Discuss how each stage of the industry life cycle (introduction,growth,maturity,and decline)can play a role in decisions that managers must make at the business level.Provide an example for each stage.

Correct AnswerverifiedThe industry life cycle refers to the st...View AnswerShow Answer

One aspect of using a cost leadership strategy is that experience effects may lead to lower costs.Experience effects are achieved by

Correct AnswerverifiedShow Answer

Atlas Door created competitive advantage by reducing the time to receive and process an order and through installing a just-in-time logistics operation.Which of the following is not a reason for their favorable position relative to the five forces of industry competition?

Correct AnswerverifiedShow Answer

A pitfall of integrated overall cost leadership and differentiation is underestimating the expenses associated with coordinating value-creating activities in the extended value chain.

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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The industry life cycle refers to the st...
View Answer

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Correct Answer
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