Business & Management Test: Business Strategy Part- II

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  • 1/60 Questions

    A firm that takes on too much long-term debt to finance operations will see an immediate impact on its indicators of _______ financial leverage.

    • Long-term
    • Short-term
    • Comparable
    • Relative
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About This Quiz

This Business & Management Test: Business Strategy Part-II assesses knowledge on unrelated diversification, forecasting inputs, e-team challenges, legal environment impacts, human capital, and knowledge management. It enhances strategic thinking and compliance awareness, crucial for business professionals.

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  • 2. 

    Wall Street executives have received excessive bonus pay in the past. This concerns which of the following stakeholder groups most directly?

    • Government

    • Creditors

    • Stockholders

    • Suppliers

    Correct Answer
    A. Stockholders
    Explanation
    The excessive bonus pay received by Wall Street executives directly concerns the stockholders. Stockholders are the individuals or entities who own shares in a company and therefore have a financial stake in its performance. When executives receive excessive bonus pay, it can negatively impact the company's profitability and ultimately the value of the stockholders' investments.

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  • 3. 

    In contrast to the vision of an organization, its mission should

    • Encompass both the purpose of the company as well as the basis of competition.

    • Be shorter in length.

    • Be less detailed.

    • Encompass all the major rules and regulations of the corporate work force.

    Correct Answer
    A. Encompass both the purpose of the company as well as the basis of competition.
    Explanation
    The mission of an organization should encompass both the purpose of the company and the basis of competition because it serves as a guiding statement that outlines the overall goals and objectives of the organization. It defines what the organization aims to achieve and how it plans to differentiate itself from competitors. By including both the purpose and basis of competition in the mission, the organization ensures that its direction and focus are clear, allowing it to align its strategies and resources accordingly. This helps in setting a clear path for the organization's success and enables stakeholders to understand and support its mission.

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  • 4. 

    Primark, a fashion retailer, has found a way to keep its cost structure lower than its rivals by leveraging streamlined logistics, a low marketing budget, and negotiating bargain prices from its suppliers. They are using a(n) ______________ strategy.

    • Focus

    • Overall cost leadership

    • Broad differentiation

    • Differentiation

    Correct Answer
    A. Overall cost leadership
    Explanation
    Primark's strategy of keeping its cost structure lower than its rivals by leveraging streamlined logistics, a low marketing budget, and negotiating bargain prices from its suppliers indicates an overall cost leadership strategy. This means that Primark focuses on providing products at the lowest possible cost while still maintaining acceptable quality. By doing so, they aim to attract price-sensitive customers and gain a competitive advantage in the market.

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  • 5. 

    Facebook, Intuit, AB InBev, and others empower their recruiters to make offers on the spot when they interview college students, without knowing what specific position they will fill.These firms search for candidates with attributes such as being a self-starter and a problem-solver, and make quick offers to preempt the market. This is an example of which value chain support activity?

    • Technology development

    • Procurement

    • Human resource management

    • Operations

    Correct Answer
    A. Human resource management
    Explanation
    This scenario exemplifies the human resource management support activity. By empowering their recruiters to make on-the-spot offers to college students based on their attributes, such as being a self-starter and problem-solver, these firms are actively managing their human resources to preempt the market. This demonstrates the importance of effectively selecting and hiring the right candidates to support the organization's goals and objectives.

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  • 6. 

    Which is considered a force in the five-forces model?

    • Rivalry among competing firms

    • Increased deregulation in an industry

    • The threat of government intervention

    • Recent technological innovation

    Correct Answer
    A. Rivalry among competing firms
    Explanation
    The correct answer is rivalry among competing firms. In the five-forces model, this force refers to the level of competition and rivalry between firms operating in the same industry. It includes factors such as price competition, product differentiation, marketing strategies, and overall intensity of competition. This force is important because it affects the profitability and sustainability of firms in the industry. Increased rivalry can lead to lower prices, reduced profit margins, and the need for firms to constantly innovate and differentiate themselves to stay competitive.

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  • 7. 

    Stakeholders are

    • Creditors who hold a lien on the assets of the organization.

    • Attorneys and their clients who sue the organization.

    • Individuals, groups, and organizations who have a stake in the success of the organization.

    • A new way to describe stockholders.

    Correct Answer
    A. Individuals, groups, and organizations who have a stake in the success of the organization.
    Explanation
    The correct answer is "individuals, groups, and organizations who have a stake in the success of the organization." This answer accurately defines stakeholders as individuals, groups, or organizations who have an interest or investment in the success of the organization. This can include employees, customers, suppliers, shareholders, and other parties who may be affected by the organization's actions or outcomes. The answer also aligns with the commonly accepted definition of stakeholders in business and management contexts.

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  • 8. 

    Which of the following is a risk (or potential pitfall) of cost leadership?

    • Cost cutting in one area of the value chain might increase costs in another.

    • Cost differences increase as the market matures.

    • Producers are more able to withstand increases in supplier costs.

    • Attempts to stay ahead of the competition may lead to gold plating.

    Correct Answer
    A. Cost cutting in one area of the value chain might increase costs in another.
    Explanation
    Cost cutting in one area of the value chain might increase costs in another. This is a risk of cost leadership because when a company focuses solely on reducing costs in one area, it may inadvertently overlook the potential negative impacts on other areas of the value chain. For example, if a company decides to cut costs in manufacturing by using cheaper materials, it may result in lower product quality or increased product defects, leading to higher costs in terms of customer complaints, returns, or even potential recalls. Therefore, cost cutting in one area can potentially create cost increases in other areas, undermining the overall cost leadership strategy.

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  • 9. 

    In the general environment, many relationships exist among the various elements. General environmental trends can have positive and negative impacts on various industries. For example, the aging population might have a ______ impact on the health care industry and a ______ impact on the baby product industry. These are called _____________ impacts.

    • Negative; positive; sociocultural

    • Positive; negative; demographic

    • Negative; positive; demographic

    • Positive; negative; technological

    Correct Answer
    A. Positive; negative; demographic
    Explanation
    The aging population can have a positive impact on the health care industry because it creates a higher demand for medical services and products. On the other hand, it can have a negative impact on the baby product industry because there will be a decrease in the number of potential customers for baby products. These impacts are referred to as demographic impacts because they are related to changes in the population's characteristics and composition.

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  • 10. 

    Which of the following would be an entry barrier?

    • Large economies of scale

    • Easy access to raw materials

    • Low switching costs

    • Low capital requirements

    Correct Answer
    A. Large economies of scale
    Explanation
    Large economies of scale can act as an entry barrier because they allow established companies to produce goods or services at a lower cost per unit compared to new entrants. This cost advantage makes it difficult for new competitors to enter the market and compete effectively. Established companies can achieve economies of scale through factors such as bulk purchasing, efficient production processes, and widespread distribution networks. As a result, new entrants may struggle to match the cost efficiency and competitiveness of established players, making it challenging for them to enter and succeed in the market.

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  • 11. 

    Managers must commit to a _________ use of the balanced scorecard if they expect sustained performance.

    • Rapid

    • Interim

    • Long-term

    • Short-term

    Correct Answer
    A. Long-term
    Explanation
    Managers must commit to a long-term use of the balanced scorecard if they expect sustained performance. This means that they need to adopt a strategic and continuous approach to using the balanced scorecard, rather than viewing it as a short-term or temporary solution. By committing to a long-term use, managers can effectively track and measure performance over time, identify areas for improvement, and make informed decisions to drive sustained success.

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  • 12. 

    The management of intellectual property involves all of the following except

    • Converting explicit knowledge to tacit knowledge.

    • Patents.

    • Contracts with confidentiality and non-compete clauses.

    • Copyrights and trademark.

    Correct Answer
    A. Converting explicit knowledge to tacit knowledge.
    Explanation
    The management of intellectual property involves various strategies and tools to protect and capitalize on intellectual assets. This includes obtaining patents, establishing contracts with confidentiality and non-compete clauses, and securing copyrights and trademarks. However, converting explicit knowledge to tacit knowledge is not a part of the management of intellectual property. This process refers to the transformation of documented or codified knowledge into practical or experiential knowledge, which is beyond the scope of intellectual property management.

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  • 13. 

    The vision and mission statements of a company set the overall direction of the organization. Strategic objectives serve what role?

    • Are a shorter version of the mission statement

    • Modify the mission statement

    • Operationalize the mission statement

    • Are only clarified by the board of directors

    Correct Answer
    A. Operationalize the mission statement
    Explanation
    Strategic objectives serve the role of operationalizing the mission statement. While the vision and mission statements set the overall direction of the organization, strategic objectives provide specific and measurable goals that help translate the mission into actionable steps. These objectives outline the key priorities and actions that need to be taken to achieve the mission and guide the organization's strategic planning and decision-making processes. Therefore, strategic objectives play a crucial role in turning the mission statement into practical and achievable outcomes.

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  • 14. 

    It is anticipated that the worldwide shortage of highly skilled, college-educated workers will increase significantly by 2020, according to research by McKinsey Global Institute. Some companies are going as far as to redefine the jobs of their experts and are transferring some of their tasks to lower-skilled people inside and outside of their companies. By redefining these _________ knowledge jobs, they address _____________ shortages and _____________ costs while enhancing job satisfaction.

    • High-value; skill; lower

    • High-value; personnel; increase

    • Low-value; monetary; decrease

    • High-value; skill; increase

    Correct Answer
    A. High-value; skill; lower
    Explanation
    By redefining these high-value knowledge jobs, companies address skill shortages and lower costs while enhancing job satisfaction. This means that companies are redefining the roles of their highly skilled workers and transferring some tasks to lower-skilled individuals. This helps to alleviate the shortage of highly skilled workers while also reducing costs for the company. Additionally, by allowing highly skilled workers to focus on more complex tasks, it can increase job satisfaction for these individuals.

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  • 15. 

    _________ is the network of relationships that individuals have throughout the organization.

    • Human capital

    • Social capital

    • Tacit knowledge

    • Intellectual capital

    Correct Answer
    A. Social capital
    Explanation
    Social capital refers to the network of relationships that individuals have throughout the organization. It encompasses the social connections, trust, and cooperation among individuals within a company. This network of relationships is crucial for effective communication, collaboration, and knowledge sharing, which ultimately contribute to the overall success and performance of the organization.

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  • 16. 

    In the __________ stage of the industry life cycle, there are many segments, competition is very intense, and the emphasis on process design is high.

    • Decline

    • Maturity

    • Introduction

    • Growth

    Correct Answer
    A. Maturity
    Explanation
    In the maturity stage of the industry life cycle, there are many segments, competition is very intense, and the emphasis on process design is high. This is because in the maturity stage, the industry has already established itself and reached a stable level of growth. As a result, there are multiple segments within the industry, each with its own competitors. The competition becomes intense as companies fight for market share. Additionally, in order to stay competitive, companies in the maturity stage often focus on improving their processes and efficiency to maximize their profits.

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  • 17. 

    Managers should do more than focus on short-term financial performance. One concept that helps managers do this is stakeholder symbiosis. This means that

    • All stakeholders want to maximize shareholder returns.

    • One can only gain at the expense of someone else.

    • Stakeholders are dependent on each other for their success.

    • Stakeholders look out for their individual interests.

    Correct Answer
    A. Stakeholders are dependent on each other for their success.
    Explanation
    The concept of stakeholder symbiosis suggests that stakeholders are dependent on each other for their success. This means that the success of one stakeholder group is intertwined with the success of other stakeholder groups. It emphasizes the idea that all stakeholders, including shareholders, employees, customers, suppliers, and the community, have a mutual interest in the long-term success and sustainability of the organization. By recognizing and managing these interdependencies, managers can create value for all stakeholders and achieve long-term success for the organization.

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  • 18. 

    Harley-Davidson markets motorcycles, clothes, toys, and restaurants. It uses its strong ________, which is __________.

    • Brand image; a tangible resource

    • Financial position; an intangible resource

    • Brand image; an intangible resource

    • Technological resources; an intangible resource

    Correct Answer
    A. Brand image; an intangible resource
    Explanation
    Harley-Davidson markets a range of products including motorcycles, clothes, toys, and restaurants. The company's strong brand image plays a crucial role in its marketing strategy. A brand image refers to the perception and reputation that consumers have of a particular brand. It is intangible because it cannot be physically touched or measured. In the case of Harley-Davidson, its brand image represents qualities such as freedom, rebellion, and a sense of adventure, which attracts customers and sets the company apart from its competitors. This intangible resource is a valuable asset for Harley-Davidson as it helps to differentiate its products and build customer loyalty.

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  • 19. 

    According to Michael Porter in his book, Competitive Advantage, a key concept used in analyzing the competitive position of a firm is creating value for

    • Buyers that exceeds the costs of production (i.e., margin).

    • Suppliers that exceeds the costs of production (i.e., margin).

    • Employees that exceeds the costs of production (i.e., margin).

    • Government that exceeds the costs of production (i.e., margin).

    Correct Answer
    A. Buyers that exceeds the costs of production (i.e., margin).
    Explanation
    According to Michael Porter, a key concept in analyzing the competitive position of a firm is creating value for buyers that exceeds the costs of production. This means that the firm should aim to provide products or services that are valued by buyers more than the cost it takes to produce them. By doing so, the firm can achieve a competitive advantage and attract more customers. This concept focuses on the importance of satisfying customer needs and preferences to gain a strong market position.

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  • 20. 

    Which of the following is not an input process to develop forecasts?

    • Environmental monitoring

    • Environmental scanning

    • Competitor intelligence

    • Stakeholder management

    Correct Answer
    A. Stakeholder management
    Explanation
    Stakeholder management is not an input process to develop forecasts. Stakeholder management refers to the identification, analysis, and engagement of individuals or groups who have an interest or influence in a project or organization. It involves understanding their needs, expectations, and concerns and managing relationships with them. While stakeholder management is important for overall project success, it does not directly contribute to the development of forecasts. On the other hand, environmental monitoring, environmental scanning, and competitor intelligence are all input processes that provide valuable information and data to develop accurate forecasts.

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  • 21. 

    The hierarchy of organizational goals is in the following order (least specific to most specific):

    • Vision statements, mission statements, strategic objectives.

    • Mission statements, strategic objectives, vision statements.

    • Vision statements, strategic objectives, mission statements.

    • Mission statements, vision statements, strategic objectives.

    Correct Answer
    A. Vision statements, mission statements, strategic objectives.
    Explanation
    The correct answer is vision statements, mission statements, strategic objectives. This hierarchy is based on the level of specificity and the overall direction of the organization. Vision statements provide a broad and overarching goal or purpose for the organization. Mission statements are more specific and outline the organization's core values, target audience, and primary objectives. Strategic objectives are the most specific and outline the specific actions and goals that need to be achieved to fulfill the mission and vision of the organization. Therefore, vision statements come first to set the overall direction, followed by mission statements to provide more specific guidance, and finally strategic objectives to outline the specific actions needed to achieve the mission and vision.

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  • 22. 

    Firms that choose to diversify through internal development must develop _________ that allow them to move __________ from initial opportunity recognition to market introduction.

    • Capabilities; quickly

    • Strategies; slowly

    • Strategies; quickly

    • Capabilities; slowly

    Correct Answer
    A. Capabilities; quickly
    Explanation
    Firms that choose to diversify through internal development must develop capabilities that allow them to move quickly from initial opportunity recognition to market introduction. This means they need to have the necessary skills, resources, and expertise to efficiently and effectively bring new products or services to the market. By developing these capabilities, firms can minimize the time it takes to capitalize on new opportunities and gain a competitive advantage.

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  • 23. 

    Rivals would find it difficult to challenge Atlas Door in the short run because of

    • Weak customer loyalty.

    • Low buyer switching costs.

    • High barriers to entry.

    • High threat of substitution.

    Correct Answer
    A. High barriers to entry.
    Explanation
    High barriers to entry refers to the obstacles or challenges that new competitors would face when trying to enter a particular market. In the case of Atlas Door, these barriers could include factors such as strong brand recognition, established customer base, proprietary technology or patents, economies of scale, or significant capital requirements. These barriers make it difficult for new competitors to enter the market and pose a challenge to Atlas Door in the short run. Weak customer loyalty, low buyer switching costs, and high threat of substitution do not directly address the difficulty of challenging Atlas Door in the short run.

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  • 24. 

    Outside the flight experience itself, airlines are generating revenue by charging fees for credit cards, frequent-flyer programs, and access to airport lounges. This serves to

    • Expand the profit pool.

    • Provide better customer service.

    • Satisfy regulators.

    • Increase competition.

    Correct Answer
    A. Expand the profit pool.
    Explanation
    Airlines are generating revenue by charging fees for various services such as credit cards, frequent-flyer programs, and access to airport lounges. This allows them to increase their overall profit pool by diversifying their income sources beyond just ticket sales. By expanding the profit pool, airlines can potentially offset any fluctuations in ticket prices or demand for flights, ensuring a more stable and sustainable revenue stream.

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  • 25. 

    Portfolio management frameworks, such as the BCG matrix, share which of the following characteristics?

    • Position in the matrix suggests a need for sharing synergies.

    • They are most helpful in helping businesses develop types of competitive advantage.

    • Businesses are plotted on a 3-dimensional grid.

    • Grid dimensions are based on external environments and internal capabilities-market positions.

    Correct Answer
    A. Grid dimensions are based on external environments and internal capabilities-market positions.
    Explanation
    Portfolio management frameworks, such as the BCG matrix, are based on grid dimensions that represent the external environments and internal capabilities-market positions of businesses. This means that the positioning of businesses in the matrix is determined by their market positions and their ability to compete in the external environment. This information helps businesses identify their strengths and weaknesses and make informed decisions about resource allocation and strategic planning. It does not suggest a need for sharing synergies or help businesses develop types of competitive advantage.

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  • 26. 

    The primary aim of strategic management at the business level is

    • Achieving a low-cost position.

    • Maximizing differentiation of products and/or services.

    • Maximizing risk to return trade-offs through diversification.

    • Achieving competitive advantage.

    Correct Answer
    A. Achieving competitive advantage.
    Explanation
    The primary aim of strategic management at the business level is achieving competitive advantage. This means that the organization wants to position itself in a way that allows it to outperform its competitors and gain a superior market position. This can be achieved through various means such as offering unique products or services, having a lower cost structure, or effectively targeting a specific market segment. By achieving competitive advantage, the organization can secure long-term success and profitability.

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  • 27. 

    Corporate-level strategy focuses on

    • Managing investment bankers and their interests.

    • Gaining short-term profits.

    • Gaining long-term revenue.

    • Decreasing business locations.

    Correct Answer
    A. Gaining long-term revenue.
    Explanation
    Corporate-level strategy refers to the overall direction and scope of a company, including its long-term goals and how it plans to achieve them. It involves making decisions that affect the entire organization, such as entering new markets, acquiring other companies, or diversifying its product portfolio. By focusing on gaining long-term revenue, the company aims to ensure sustainable growth and profitability over time, rather than prioritizing short-term profits or reducing business locations. This approach allows the company to build a strong foundation for future success and create value for its shareholders.

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  • 28. 

    ___________ diversification is when a firm enters a different business that has little horizontal interaction with other businesses of a firm.

    • Synergistic

    • Related

    • Horizontal

    • Unrelated

    Correct Answer
    A. Unrelated
    Explanation
    Unrelated diversification refers to when a firm enters a different business that has little horizontal interaction with other businesses of the firm. This means that the new business is not related or connected to the existing businesses of the firm. Unlike synergistic or related diversification, where the new business is connected to the existing businesses and can benefit from synergies or shared resources, unrelated diversification involves entering a completely different industry or market with no significant interaction or synergy with the existing businesses.

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  • 29. 

    Shaw Industries, a giant carpet manufacturer, increases its control over raw materials by producing much of its own polypropylene fiber, a key input into its manufacturing process. This is an example of

    • Pooled negotiating power.

    • Vertical integration.

    • Sharing activities.

    • Leveraging core competencies.

    Correct Answer
    A. Vertical integration.
    Explanation
    Vertical integration refers to a strategy where a company expands its control over various stages of the supply chain. In this case, Shaw Industries, a carpet manufacturer, produces its own polypropylene fiber, a key input for its manufacturing process. By doing so, Shaw Industries is vertically integrating its operations by controlling the production of a crucial raw material. This allows the company to have greater control over its supply chain, reduce dependency on external suppliers, and potentially gain cost and quality advantages. Therefore, the correct answer is vertical integration.

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  • 30. 

    The Dodd-Frank Wall Street Reform and Consumer Protection Act require companies to disclose whether any tin, tantalum, tungsten or gold in their supply chain is connected to violent militia groups in the Congo or nine surrounding countries, including Angola, Rwanda, and Sudan. This is an example of which segment of the general environment?

    • Demographic

    • Political and legal

    • Sociocultural

    • Economic

    Correct Answer
    A. Political and legal
    Explanation
    The given statement describes a requirement imposed by the Dodd-Frank Wall Street Reform and Consumer Protection Act, which is a political and legal regulation. This regulation mandates companies to disclose any connection between tin, tantalum, tungsten, or gold in their supply chain and violent militia groups in the Congo and surrounding countries. Therefore, this requirement falls under the political and legal segment of the general environment.

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  • 31. 

    Which one of the following statements is an example of how to improve perceptual acuity?

    • A CEO meets with the company management team regularly to analyze current world events and their potential impact on the company.

    • Outsiders are brought in to the board meeting to critique the company strategy, which considers the new information in its potential revamping of the strategy.

    • A CEO meets with direct competitors to analyze current industry trends. The CEOs share their conclusions with their respective companies.

    • A CEO meets with other CEOs of non-competing companies to examine the world from multiple perspectives and then shares the results with his own management team.

    Correct Answer
    A. A CEO meets with direct competitors to analyze current industry trends. The CEOs share their conclusions with their respective companies.
    Explanation
    The statement "A CEO meets with direct competitors to analyze current industry trends. The CEOs share their conclusions with their respective companies" is an example of how to improve perceptual acuity. By meeting with direct competitors and analyzing industry trends, the CEO gains a deeper understanding of the market and can make more informed decisions for their own company. Sharing the conclusions with their respective companies allows for a broader perspective and helps in identifying potential opportunities and threats in the industry. This practice enhances the CEO's perceptual acuity by expanding their awareness and understanding of the competitive landscape.

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  • 32. 

    The text discusses three areas a firm must be concerned with to keep their best and brightest employees from leaving. These include all the following except

    • Developing

    • Hiring/selecting

    • Retaining

    • Sorting/absorping

    Correct Answer
    A. Sorting/absorping
    Explanation
    The text discusses three areas a firm must be concerned with to keep their best and brightest employees from leaving. These areas include developing, hiring/selecting, and retaining. Sorting/absorbing is not mentioned in the text as one of the areas a firm needs to be concerned with to retain their employees.

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  • 33. 

    In making the decision to enter the pharmaceutical industry, a company would not need to consider which of the following?

    • Comparisons with non-competitors

    • Historical comparisons

    • Comparisons with industry norms

    • Comparisons with key competitors

    Correct Answer
    A. Comparisons with non-competitors
    Explanation
    When considering entering the pharmaceutical industry, a company would not need to consider comparisons with non-competitors. This is because non-competitors are not directly involved in the same industry and therefore their performance or practices may not be relevant or comparable to the company's decision-making process. The focus should be on historical comparisons, industry norms, and comparisons with key competitors who are directly involved in the same market and can provide valuable insights for strategic decision-making.

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  • 34. 

    Two of the key inputs to developing forecasts discussed in the text are

    • Environmental scanning and competitive intelligence.

    • Assessing internal strengths and environmental scanning.

    • Environmental scanning and a SWOT analysis.

    • Environmental scanning and stakeholder identification.

    Correct Answer
    A. Environmental scanning and competitive intelligence.
    Explanation
    The correct answer is environmental scanning and competitive intelligence. These two inputs are important in developing forecasts because environmental scanning involves monitoring and analyzing external factors that may impact the organization's future performance, such as economic trends, technological advancements, and regulatory changes. Competitive intelligence, on the other hand, involves gathering information about competitors' strategies, products, and market positioning in order to identify potential threats and opportunities. By considering both environmental factors and competitive landscape, organizations can make more accurate forecasts and develop effective strategies to stay competitive in the market.

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  • 35. 

    Creativity and problem-solving ability are considered to be part of _________ capital.

    • Physical

    • Social

    • Emotional

    • Human

    Correct Answer
    A. Human
    Explanation
    Creativity and problem-solving ability are considered to be part of human capital because they are skills and abilities that individuals possess and can contribute to their productivity and success in various fields. Human capital refers to the knowledge, skills, and abilities that individuals acquire through education, training, and experience, which can be used to generate economic value. Creativity and problem-solving are important components of human capital as they enable individuals to come up with innovative solutions, think critically, and adapt to changing circumstances, ultimately contributing to personal and professional growth.

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  • 36. 

    Which of the following is not an example of organizational capabilities?

    • Reputation with customers for quality and reliability

    • Innovativeness of products and services

    • Outstanding customer service

    • Ability to hire, motivate, and retain human capital

    Correct Answer
    A. Reputation with customers for quality and reliability
    Explanation
    Reputation with customers for quality and reliability is an example of organizational capabilities. Organizational capabilities refer to the unique skills, resources, and competencies that an organization possesses, allowing it to achieve its strategic goals and gain a competitive advantage. Reputation with customers for quality and reliability is a valuable capability that can differentiate a company from its competitors and attract more customers. It reflects the organization's ability to consistently deliver high-quality products or services, which enhances customer satisfaction and loyalty.

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  • 37. 

    There are multiple challenges associated with making effective e-teams. Which of the following is not a challenge?

    • The physically dispersed team is susceptible to the risk factors that can create process loss.

    • E-teams can be effective in generating social capital.

    • Process losses result from identification and combination activities.

    • Some collective energy, time, and effort must be devoted to dealing with team inefficiencies.

    Correct Answer
    A. E-teams can be effective in generating social capital.
  • 38. 

    An organization is responsible to many different entities. In order to meet the demands of these groups, organizations must participate in stakeholder management. Stakeholder management means that

    • Interests of the stockholders are not the only interests that matter.

    • All stakeholders receive financial rewards.

    • Stakeholders and managers inevitably work at cross-purposes.

    • Stakeholders are second in importance to the stockholders.

    Correct Answer
    A. Interests of the stockholders are not the only interests that matter.
    Explanation
    Stakeholder management means that the organization recognizes that the interests of the stockholders are not the only interests that matter. It involves considering and addressing the needs and concerns of all stakeholders, including employees, customers, suppliers, communities, and the environment. By taking into account the diverse interests of these groups, organizations can strive for a more balanced and sustainable approach to decision-making and ensure long-term success.

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  • 39. 

    Data Analytics are being used by corporations to understand their customer purchasing patterns. This is an example of which segment of the general environment?

    • Political and legal

    • Economic

    • Technological

    • Demographic

    Correct Answer
    A. Technological
    Explanation
    Data analytics being used by corporations to understand customer purchasing patterns falls under the technological segment of the general environment. This is because data analytics relies on technology and advanced tools to collect, analyze, and interpret large amounts of data. It involves the use of algorithms, statistical models, and machine learning techniques to uncover patterns and insights from the data. By leveraging technology, corporations can gain valuable insights into customer behavior and preferences, which can inform their decision-making and marketing strategies.

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  • 40. 

    All of the following are examples of socially complex organizational phenomena except

    • Complex physical technology

    • The culture of a firm.

    • Leadership and trust

    • Interpersonal relations among managers of a firm.

    Correct Answer
    A. Complex physical technology
    Explanation
    Complex physical technology is not an example of a socially complex organizational phenomenon because it refers to the physical machinery, equipment, or tools used in an organization, which do not involve social interactions or relationships between individuals. Socially complex organizational phenomena typically involve the interactions, relationships, and dynamics between people within an organization, such as the culture, leadership, trust, and interpersonal relations among managers.

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  • 41. 

    The balanced scorecard provides top managers with a __________ view of the business.

    • Detailed and complex

    • Fast but comprehensive

    • Long-term financial

    • Simple and routine

    Correct Answer
    A. Fast but comprehensive
    Explanation
    The balanced scorecard provides top managers with a fast but comprehensive view of the business. This means that it allows them to quickly assess the overall performance of the organization while also providing detailed information on various aspects of the business. This enables managers to make informed decisions and take necessary actions in a timely manner. The balanced scorecard combines both speed and comprehensiveness, making it a valuable tool for top managers.

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  • 42. 

    Factors that directly affect the merger and acquisition environment include all the following except

    • Currency fluctuations.

    • Managerial styles

    • Level of optimism about the future.

    • General economic conditions.

    Correct Answer
    A. Managerial styles
    Explanation
    The given question asks for a factor that does not directly affect the merger and acquisition environment. All the options provided are factors that can have a direct impact on mergers and acquisitions, except for managerial styles. Managerial styles refer to the way in which managers make decisions and lead their teams, which may indirectly influence the success of a merger or acquisition but may not have a direct impact on the overall environment. Therefore, the correct answer is managerial styles.

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  • 43. 

    Research published in Personnel Psychology shows that older workers are slightly more willing to implement organizational changes than younger workers. This is an example of which segment of the general environment?

    • Sociocultural

    • Political and legal

    • Economic

    • Demographic

    Correct Answer
    A. Sociocultural
    Explanation
    The research findings suggest that older workers are more open to implementing organizational changes compared to younger workers. This indicates a sociocultural aspect of the general environment, as it pertains to the social and cultural factors influencing individuals' attitudes and behaviors in the workplace.

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  • 44. 

    An important implication of the balanced scorecard approach is that

    • Gains in financial performance must come at a cost of employee satisfaction.

    • Managers should not look at their job as primarily balancing stakeholder demands.

    • Managers need to recognize that satisfaction of stockholder demands is their primary job.

    • The emphasis on customer satisfaction and financial goals are only a means to that end.

    Correct Answer
    A. Managers should not look at their job as primarily balancing stakeholder demands.
    Explanation
    The correct answer implies that managers should not view their job as primarily balancing stakeholder demands. This suggests that the balanced scorecard approach encourages managers to consider a broader range of factors beyond just stakeholder demands, such as customer satisfaction and financial goals. By focusing on a balanced set of metrics, managers can ensure that they are not solely prioritizing the needs of stakeholders, but also considering the needs of other important stakeholders, such as customers and employees. This approach promotes a more holistic and comprehensive view of managerial responsibilities.

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  • 45. 

    The effective management of diversity can enhance the social responsibility goals of an organization. Other areas where sound management of diverse workforces can improve the effectiveness of an organization and its competitive advantages include all but one of the following

    • Marketing

    • Resource acquisition

    • Problem creation

    • Organizational flexibility

    Correct Answer
    A. Problem creation
    Explanation
    The effective management of diversity can enhance the social responsibility goals of an organization because it promotes inclusivity and fairness, which are important aspects of social responsibility. In addition, managing diverse workforces can improve the effectiveness of an organization and its competitive advantages in areas such as marketing, resource acquisition, and organizational flexibility. However, problem creation is not one of the areas where sound management of diverse workforces can improve effectiveness. This suggests that managing diversity does not contribute to creating problems within an organization, but rather helps to address and overcome them.

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  • 46. 

    Learning organizations permit the entire organization to benefit from ____________ talents.

    • Internal and collective

    • Individual and collective

    • Internal and external

    • External and individual

    Correct Answer
    A. Individual and collective
    Explanation
    Learning organizations allow both individual and collective talents to contribute and benefit the entire organization. This means that not only do individuals have the opportunity to showcase their unique skills and abilities, but they also have the chance to collaborate and work together as a team. By harnessing both individual strengths and the power of collective intelligence, learning organizations can maximize their potential and drive innovation, growth, and success.

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  • 47. 

    Mass customization permits companies to manufacture unique products in relatively _________ quantities at ______ costs.

    • Large; lower

    • Large; higher

    • Small; higher

    • Small; lower

    Correct Answer
    A. Small; lower
    Explanation
    Mass customization allows companies to produce unique products in smaller quantities at lower costs. This is because mass customization combines the benefits of mass production (lower costs due to economies of scale) with the advantages of customization (meeting individual customer needs and preferences). By producing in smaller quantities, companies can reduce inventory and waste, while lower costs are achieved through efficient production processes and supply chain management. This approach enables companies to offer personalized products without incurring high production expenses.

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  • 48. 

    Internal development may be time consuming and, therefore, firms may forfeit the benefits of speed that growth through __________ and __________ can provide.

    • Mergers; joint ventures

    • Strategic alliances; joint ventures

    • Strategic alliances; mergers

    • Mergers; acquisitions

    Correct Answer
    A. Mergers; acquisitions
    Explanation
    Internal development refers to a company's efforts to grow and expand its business organically, through activities such as research and development, product innovation, and market penetration. However, this process can be time-consuming, as it requires significant investment, resources, and expertise. On the other hand, mergers and acquisitions offer a faster way for firms to achieve growth by combining their resources, capabilities, and market presence. By acquiring or merging with another company, firms can quickly gain access to new markets, technologies, products, and customers, thereby accelerating their growth and potentially outpacing competitors. Therefore, firms may forfeit the benefits of speed that growth through mergers and acquisitions can provide if they solely rely on internal development.

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  • 49. 

    Primary value chain activities that involve the effective layout of receiving dock operations (inbound logistics) and support value chain activities that include expertise in process engineering (technology development) characterize which generic strategy?

    • Differentiation focus

    • Stuck-in-the-middle

    • Differentiation

    • Overall cost leadership

    Correct Answer
    A. Overall cost leadership
    Explanation
    The correct answer is overall cost leadership. This strategy focuses on reducing costs throughout the value chain, including inbound logistics and process engineering. By effectively managing receiving dock operations and utilizing expertise in process engineering, a company can streamline operations and minimize costs, allowing them to offer products or services at a lower price compared to competitors. This strategy aims to attract a broad market by providing affordable products or services while maintaining acceptable levels of quality.

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Quiz Review Timeline (Updated): Mar 22, 2023 +

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  • Current Version
  • Mar 22, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Jun 06, 2020
    Quiz Created by
    Duke Cunningham

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