Midterm 1 Study Guide! Capstone 1

100 Questions | Total Attempts: 964

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Midterm 1 study guide


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  • 1. 
     Functional managers
    • A. 

      Are responsible for the specific business functions or operations that constitute a company or one of its divisions.

    • B. 

      Look at the overall picture of a corporation.

    • C. 

      Have no strategic role.

    • D. 

      Formulate generic strategies.

    • E. 

      Execute business-level decisions.

  • 2. 
    An important first step in the process of formulating a company's mission is to
    • A. 

      Describe the technological processor.

    • B. 

      Identify the customer segment served by the company.

    • C. 

      Answer the question, "What is our business?"

    • D. 

      Decide what the company will be like ten years from now.

    • E. 

      Evaluate the company's most recent performance.

  • 3. 
    The primary goal of a SWOT analysis is to
    • A. 

      Benchmark a company's performance.

    • B. 

      Force managers to think creatively rather than analytically.

    • C. 

      Forecast future events.

    • D. 

      Develop short-run goals.

    • E. 

      Create, affirm, or fine-tune a company-specific business model.

  • 4. 
    A component of strategy implementation is
    • A. 

      Designing the best organization structure, culture, and control systems to put a strategy into action.

    • B. 

      Enumerating the number and kind of periodic reports that must be submitted by functional-level managers.

    • C. 

      Analyzing the macroeconomic environment of the company

    • D. 

      Answering the question, "What is our business?"

    • E. 

      E) all of the above. all of the above.

  • 5. 
    The strategies that a company's managers pursue
    • A. 

      Have a major impact on the company's performance relative to its competitors.

    • B. 

      Have little or no effect on overall profitability.

    • C. 

      Typically result in higher per-unit cost of production.

    • D. 

      Result in significant industry structural changes

    • E. 

      None of the above.

  • 6. 
    A sustained competitive advantage
    • A. 

      Enables a company to maintain above-average projects for a number of years.

    • B. 

      Cannot be maintained for more than three years.

    • C. 

      Is seldom possible in today's highly competitive environment.

    • D. 

      Typically arises out of unforeseen economic events.

    • E. 

      A and D.

  • 7. 
    Scenario-based planning is a technique for coping with the problem of
    • A. 

      Uncertainty.

    • B. 

      Planning equilibrium.

    • C. 

      Bottom-up planning.

    • D. 

      Strategic fit.

    • E. 

      Cognitive bias.

  • 8. 
    Aaron planned to cut prices at his bicycle shop, but when a competing shop began to offer free repairs, Aaron decided to copy them. Aaron's new strategy (offer free repairs) is an example of a(n)
    • A. 

      Mistake.

    • B. 

      Emergent strategy.

    • C. 

      Deliberate strategy.

    • D. 

      Intended strategy.

    • E. 

      Unrealized strategy.

  • 9. 
    The fit model of strategy formulation and implementation
    • A. 

      Was proposed and supported by Prahalad and Hamel.

    • B. 

      Is not useful because the future is uncertain.

    • C. 

      Is useful for both intended and emergent strategies.

    • D. 

      Can give a company a sustainable competitive advantage.

    • E. 

      Focuses more on the current situation than on the future situation.

  • 10. 
    The role of corporate-level managers is to
    • A. 

      Define operational-level strategies.

    • B. 

      Outline functional-level strategies and plans.

    • C. 

      Oversee the development of strategies for the whole organization.

    • D. 

      Develop business-level strategies

    • E. 

      Oversee the development of business-level and functional-level strategies

  • 11. 
    Which of the following is not a characteristic of emotional intelligence?
    • A. 

      Self-awareness

    • B. 

      Self-regulation

    • C. 

      Self-esteem

    • D. 

      Empathy

    • E. 

      Social skills

  • 12. 
    A company's mission
    • A. 

      Lays out the desired future state of the company.

    • B. 

      Outlines the manner in which employees and managers should conduct themselves.

    • C. 

      Defines the manner in which strategies will be developed and attained.

    • D. 

      Describes what the company does.

    • E. 

      Answers the question, "What will our business become?"

  • 13. 
    Holly owns a landscape company and is thinking about expanding her services to include outdoor water features (waterfalls, streams, ponds). If, before making this decision, she looks at the experience of similar firms that have added outdoor water features, she is employing
    • A. 

      Wishful thinking

    • B. 

      Aqua-evaluation

    • C. 

      Devil's advocacy

    • D. 

      Outside view

    • E. 

      Dialectic inquiry

  • 14. 
    A competitive advantage is considered to be a sustained competitive advantage when the
    • A. 

      Advantage endures for a long time.

    • B. 

      Firm is able to spread the advantage to all of its business units.

    • C. 

      Advantage is very large.

    • D. 

      Advantage was gained at a low cost.

    • E. 

      Managers who developed the advantage are still employed at the firm.

  • 15. 
    The scenario approach to strategic planning involves
    • A. 

      Devising strategies for coping with a number of different possible future states of the world

    • B. 

      Homing in on a single prediction of future demand conditions using an iterative planning process

    • C. 

      Functional managers setting key corporate objectives

    • D. 

      Using computers to build virtual worlds for top-level managers.

    • E. 

      Making planning the exclusive domain of top-level managers

  • 16. 
    General managers are found
    • A. 

      Only at the corporate level

    • B. 

      Only at the business level.

    • C. 

      Only at the functional and business levels

    • D. 

      At the functional, business, and corporate levels

    • E. 

      Only at the corporate and business levels.

  • 17. 
    Devil's advocacy
    • A. 

      Is simpler than the expert approach

    • B. 

      Is vulnerable to the groupthink phenomenon

    • C. 

      Results in unproductive conflict

    • D. 

      Involves one group member being responsible for questioning the assumptions of a plan.

    • E. 

      Results in a final plan that is a combination of a plan and a counterplan

  • 18. 
    Systematic errors in the decision-making process are caused by
    • A. 

      Inadequate information.

    • B. 

      Information overload.

    • C. 

      Cognitive biases on the part of decisionmakers.

    • D. 

      Poor data collection procedures.

    • E. 

      All of the above.

  • 19. 
    Sam Walton wanted Wal-Mart to keep costs low. Therefore, as an example to others, he drove his own car and furnished his office with plain, steel desks. In this case, Mr. Walton was displaying his
    • A. 

      Commitment.

    • B. 

      Vision.

    • C. 

      Astute use of power.

    • D. 

      Emotional intelligence

    • E. 

      Eloquence

  • 20. 
    Which of the following is not a cognitive bias?
    • A. 

      Escalating commitment

    • B. 

      Reasoning by analogy

    • C. 

      Ivory tower thinking

    • D. 

      Representativeness

    • E. 

      Illusion of control

  • 21. 
    Profit growth is best measured
    • A. 

      By the increase in shareholder value

    • B. 

      By the return on investment

    • C. 

      Month by month

    • D. 

      Over time.

    • E. 

      By increases in liquidity

  • 22. 
    Maximizing shareholder value is
    • A. 

      A byproduct of a company's cost reduction programs.

    • B. 

      Not generally a viable goal for a company

    • C. 

      Not the responsibility of a company's managers

    • D. 

      The ultimate goal of profit-making companies

    • E. 

      Not required to attract risk capital

  • 23. 
    Vice President Chung is responsible for executing decisions about human resources. Mr. Chung is
    • A. 

      A corporate-level general manager

    • B. 

      Both a corporate- and business-level general manager.

    • C. 

      A business-level general manager.

    • D. 

      A functional manager.

    • E. 

      A corporate-level, business-level, and functional manager.

  • 24. 
    An emergent strategy is
    • A. 

      The result of a planned strategy

    • B. 

      An unplanned response to unforeseen circumstances.

    • C. 

      The product of careful top-down planning mechanisms.

    • D. 

      The same as a realized strategy.

    • E. 

      A group response to a problem area.

  • 25. 
    Strategic implementation involves
    • A. 

      Taking actions at the functional, business, and corporate levels.

    • B. 

      Comparing company performance with leading companies in the industry.

    • C. 

      Analyzing the macroenvironment for any last-minute changes that may have occurred

    • D. 

      Only activities at the corporate level.

    • E. 

      All of the above

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