Problem Set #3

39 Questions | Total Attempts: 91

SettingsSettingsSettings
Please wait...
Problem Quizzes & Trivia

Macro Environment, Porters 5 Forces, Property Rights and Exchange


Questions and Answers
  • 1. 
    In recent years American furniture manufacturers increased the seating space in the latest furniture designs to better accommodate the larger American population. This move is a response to growing pressure in the
    • A. 

      Demographic Environment

    • B. 

      Political Environment

    • C. 

      Social/Culture Environment

    • D. 

      Technological Environment

    • E. 

      None of the above

  • 2. 
    In 2010, baby boomers will turn 65. This milestone is a key aspect of what part of the general business environment?
    • A. 

      Political

    • B. 

      Technological

    • C. 

      Social/cultural

    • D. 

      Demographic

    • E. 

      None of the above

  • 3. 
    The Senate is set to consider legislation that would raise the federal minimum wage from $5.15 per hour to $7.25 per hour over a period of 26 months. What part of the buiness environment does this potentially affect?
    • A. 

      Technological

    • B. 

      Political

    • C. 

      Social/cultural

    • D. 

      Demographic

    • E. 

      None of the above

  • 4. 
    A corporation owns several retail chains, including The Gap and Old Navy, which sell casual clothes for the whole family. Prices at The Gap are higher on average than prices at Old Navy. The GAP clothes on average sell to families with higher incomes than clothes from Old Navy. The pricing strategies at these two stores are based on what part of the general environment?
    • A. 

      Demographic

    • B. 

      Political

    • C. 

      Social/cultural

    • D. 

      Technological

    • E. 

      None of the above

  • 5. 
    Last year, the Champaign-Urbana city council voted to allow bars to remain open until 2:00 am. This directly changed the ___________ in Champaign-Urbana.
    • A. 

      Political environment

    • B. 

      Social/cultural environment

    • C. 

      Technological environment

    • D. 

      Demographic environment

    • E. 

      None of the above

  • 6. 
    A corporation owns several retail chains, including Catherine's and Lane Bryant, which sell clothes for plus-size women. Styles at Lane Bryant are different than styles at Catherine's. Lane Bryant's clothes on average sell to younger women than clothes from Catherine's. The product strategies at these two stores are based on what part of the general environment?
    • A. 

      Demographic

    • B. 

      Political

    • C. 

      Social/cultural

    • D. 

      Technological

    • E. 

      None of the above

  • 7. 
    A county recently changed its property tax percentage. A local business primarily sells its product in this county. What part of its macro environment is most directly affected by the change in tax percentage?
    • A. 

      Socio/cultural

    • B. 

      Technical

    • C. 

      Political

    • D. 

      Demographic

    • E. 

      None of the above

  • 8. 
    A business is headquartered in Wheaton, Illinois. The business sells and delivers its product through the Chicago area. Last summer it became illegal to use a hand-held cell phone within the Chicago city limits. What part of the business's macro environment does this most directly affect?
    • A. 

      Technical

    • B. 

      Political

    • C. 

      Demographic

    • D. 

      Socio/cultural

    • E. 

      None of the above

  • 9. 
    The cost of a key production factor is steadily rising. The product made in the industry is critical for the industry's customers. Will the company raise the price of its product to compensate for the increased cost of making it? Why or why not?
    • A. 

      No, the bargaining power of buyers is high

    • B. 

      No, the bargaining power of buyers is low

    • C. 

      No, the bargaining power of suppliers is high

    • D. 

      No, the bargaining power of suppliers is low

    • E. 

      None of the above

  • 10. 
    Very few companies compete in a certain industry. Using Porter's model an analyst is likely to conclude
    • A. 

      Rivalry is high

    • B. 

      Rivalry is low

    • C. 

      The threat of substitutes is high

    • D. 

      The threat of substitutes is low

    • E. 

      None of the above

  • 11. 
    The cost of a key production factor is steadily rising. The company competes in an industry for which customers are relatively plentiful. Will the company raise the price of its product to compensate for the increase cost of making it? Why or why not?
    • A. 

      Yes, the bargaining power of buyers is high

    • B. 

      Yes, the bargaining power of buyers is low

    • C. 

      No, the bargaining power of suppliers is high

    • D. 

      No, the bargaining power of suppliers is low

    • E. 

      None of the above

  • 12. 
    Genco operates in an industry that produces products that are essential for the lives of its customers. An analyst looking at Genco's industry most likely will conclude the bargaining power of 
    • A. 

      Buyers is high

    • B. 

      Suppliers is low

    • C. 

      Buyers is low

    • D. 

      Suppliers is high

    • E. 

      None of the above

  • 13. 
    Uneek's competitive advantage stems from its hard-fisted use of large scale operations. An analyst studying Uneek's industry most likely will conclude that the threat of 
    • A. 

      New entrants is high

    • B. 

      New entrants is low

    • C. 

      Substitutes is high

    • D. 

      Substitutes is low

    • E. 

      None of the above

  • 14. 
    In a certain industry price competition is low. An analyst using Porter's Five Forces Model might conclude that 
    • A. 

      Rivalry is low

    • B. 

      Rivalry is high

    • C. 

      Industry attractiveness is high

    • D. 

      Both a and c

    • E. 

      None of the above

  • 15. 
    A certain industry has very few competitors. Using one of Porter's Five Forces to describe the industry an analyst would say that 
    • A. 

      Price competition is high

    • B. 

      Price competition is low

    • C. 

      Rivalry is high

    • D. 

      Rivalry is low

    • E. 

      None of the above

  • 16. 
    Janus Corporation purchases a large portion of production volume from Neptune Inc. Using Porter's Five Forces Model to describe the industry in which Janus competes an analyst might conclude that the bargaining power of 
    • A. 

      Suppliers is high

    • B. 

      Suppliers is low

    • C. 

      Buyers is high

    • D. 

      Buyers is low

    • E. 

      None of the above (there is no impact on relative bargaining power)

  • 17. 
    Competition in a certain industry is strongly based on product differentiation. Using one of Porter's Five Forces to describe the industry an analyst would say that 
    • A. 

      Rivalry is high

    • B. 

      Rivalry is low

    • C. 

      The threat of new entrants is high

    • D. 

      The threat of new entrants is low

    • E. 

      None of the above

  • 18. 
    In a certain industry price competition is low. An analyst using Porter's Five Forces Model might conclude that
    • A. 

      Rivalry is low

    • B. 

      Rivalry is high

    • C. 

      Industry attactiveness is high

    • D. 

      Both a and c

    • E. 

      None of the above

  • 19. 
    A certain industry has many competitors. Using one of Porter's Five Forces to describe the industry an analyst would say that
    • A. 

      Price competition is high

    • B. 

      Price competition is low

    • C. 

      Rivalry is high

    • D. 

      Rivalry is low

    • E. 

      None of the above

  • 20. 
    Star Corporation purchases a tiny portion of production volume from Moon, Inc. Using Porter's Five Forces Model to describe the industry in which Star competes an analyst might conclude that the bargaining power
    • A. 

      Suppliers is high

    • B. 

      Suppliers is low

    • C. 

      Buyers is high

    • D. 

      Buyers is low

    • E. 

      None of the above (there is no impact on relative bargaining power)

  • 21. 
    Competition in a certain industry is strongly based on product differentiation. Using one of Porter's Five Forces to describe the industry an analyst would say that the 
    • A. 

      Bargaining power of buyers is low

    • B. 

      Bargaining power of sellers is low

    • C. 

      Threat of new entrants is high

    • D. 

      Threat of new entrants is low

    • E. 

      None of the above

  • 22. 
    Firms in a certain industry have signficant investments in state of the art manufacturing facilities and rely heavily on economies of scale to compete in the market. Using Porter's Five Forces Model, an analyst could describe this industry as having
    • A. 

      A high threat of new entrants and low industry attractiveness

    • B. 

      A low threat of new entrants and low industry attractiveness

    • C. 

      A high threat of new entrants and high industry attractiveness

    • D. 

      A low threat of new entrants and high industry attractiveness

    • E. 

      None of the above

  • 23. 
    A certain industry has only a few competitors who have invested in highly flexible manufacturing equipment. Using Porter's Five Forces Model, an analyst could describe this industry as having
    • A. 

      High rivalry and high industry attractiveness

    • B. 

      Low rivalry and high industry attractiveness

    • C. 

      High rivalry and low industry attractiveness

    • D. 

      Low rivalry and low industry attractiveness

    • E. 

      None of the above

  • 24. 
    Marquet Co. purchases components from Oswego, Inc. Oswego competes in an industry that has relatively few competitors relative to the number of competitors in Marquet's industry. An analyst looking at Marquet's industry would likely conclude that the bargaining power of 
    • A. 

      Buyers is high

    • B. 

      Buyers is low

    • C. 

      Suppliers is high

    • D. 

      Suppliers is low

    • E. 

      None of the above

  • 25. 
    In the fall of 2004, a pharmaceutical company in Britain, that manufactured nearly half of the US' supply of flu vaccine, was shut down by British health authorities for having contaminated flu vaccine. As a result the US health care industry and federal, state and local health departments found themselves short of vaccine. In the short run, concern over the shortage also spawned concern over price-gouging from the remaining vaccine producers. An analyst looking at the pharmaceutical industry at that point could have concluded that the bargaining power of
    • A. 

      Buyers was high

    • B. 

      Buyers was low

    • C. 

      Suppliers was high

    • D. 

      Suppliers was low

    • E. 

      None of the above