Strategic Sustainability in Business
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Questions and Answers

What is gross margin defined as?

  • Revenue minus fixed costs
  • Total costs minus profit
  • Total revenue minus expenses
  • Revenue minus variable costs (correct)

    • How does strategic sustainability impact the demand curve?

  • It eliminates the demand curve
  • It shifts the demand curve inward
  • It has no effect on the demand curve
  • It shifts the demand curve outward (correct)

    • What is a requirement for a firm to achieve strategic sustainability?

  • Reducing production costs by any means
  • Investing in lower-quality inputs
  • Focusing on short-term profit maximization
  • Committing to cleaner inputs and processes (correct)

    • What effect does strategic sustainability generally have on marginal costs?

    <p>Increases marginal costs through cleaner processes (C)</p> Signup and view all the answers

    What is the ultimate goal of implementing strategic sustainability according to the content?

    <p>To increase profit through differentiation (C)</p> Signup and view all the answers

    What does gross margin help determine in a business context?

    <p>Profitability after considering fixed costs (B)</p> Signup and view all the answers

    What impact does strategic sustainability have on competition for buyers?

    <p>Strengthens competition by increasing product value perception (A)</p> Signup and view all the answers

    Which scenario demonstrates a firm's commitment to strategic sustainability?

    <p>Investing in renewable energy sources (C)</p> Signup and view all the answers

    What is the primary reason companies need a sense of purpose?

    <p>To achieve full potential and retain stakeholder support (B)</p> Signup and view all the answers

    How does BlackRock suggest CEOs approach long-term value creation?

    <p>By outlining a strategic framework for shareholders each year (A)</p> Signup and view all the answers

    What is the relationship between ESG issues and stakeholder risk according to BlackRock?

    <p>ESG issues link directly to stakeholder risk, affecting profit (C)</p> Signup and view all the answers

    What can activists adversely affect in a company?

    <p>The company's brand and reputation (A)</p> Signup and view all the answers

    What does 'stakeholder capitalism' promote according to the content?

    <p>Efficient long-term allocation of capital and durability in profitability (A)</p> Signup and view all the answers

    What type of risk can high compliance costs lead to?

    <p>Regulatory risk affecting operational capabilities (D)</p> Signup and view all the answers

    What can happen when consumers abandon an unresponsive brand?

    <p>Market risk impacting revenue generation (D)</p> Signup and view all the answers

    What is one of the quantifiable financial impacts of ESG issues mentioned?

    <p>Improved long-term shareholder returns (B)</p> Signup and view all the answers

    What was the primary reason for choosing Prineville as the site for Facebook's data center?

    <p>Energy efficiency of the facility (B)</p> Signup and view all the answers

    What percentage of Facebook users engaged with the 'Unfriend Coal' campaign?

    <p>0.1% (A)</p> Signup and view all the answers

    What was one of the potential risks of Facebook giving in to Greenpeace's demands?

    <p>Accusations of greenwashing (B)</p> Signup and view all the answers

    How could sharing detailed carbon footprint data benefit Facebook?

    <p>It would strengthen activist capabilities (B)</p> Signup and view all the answers

    What implication did Greenpeace's demands have according to the document?

    <p>They had implicit flexibility (B)</p> Signup and view all the answers

    What is a potential consequence of advocating for a single issue, as identified in the discussion?

    <p>It could lead to demands for political neutrality (A)</p> Signup and view all the answers

    What was a suggested approach for Facebook regarding its carbon footprint by 2021?

    <p>Adjusting goals based on changing conditions (A)</p> Signup and view all the answers

    As of 2020, what was viewed as a sound business strategy regarding Greenpeace's demands?

    <p>Surrendering to the demands (A)</p> Signup and view all the answers

    What was a significant reason for selecting Prineville for the facility?

    <p>Availability of renewable power resources (B)</p> Signup and view all the answers

    What was the total cost of establishing the facility in Prineville?

    <p>$188 million (C)</p> Signup and view all the answers

    What innovative cooling system was employed in the facility?

    <p>Airside economizer using outside air (B)</p> Signup and view all the answers

    Which of the following statements about Facebook's energy consumption is true?

    <p>It will surpass the combined energy consumption of France, Germany, Canada, and Brazil in 2010. (C)</p> Signup and view all the answers

    What was the size of the facility constructed in Prineville?

    <p>147,000 square feet (A)</p> Signup and view all the answers

    What was the employment situation in Prineville at the time of the facility's establishment?

    <p>Unemployment was 20% (A)</p> Signup and view all the answers

    What was PacifiCorp's energy sourcing for the Prineville plant?

    <p>60% from burning coal (A)</p> Signup and view all the answers

    If considered a country, where would data centers rank in total energy use globally?

    <p>Fifth (C)</p> Signup and view all the answers

    Which phase involves the highest ability to influence before public support is established?

    <p>Development (D)</p> Signup and view all the answers

    What factor significantly raises the benefit of compliance for firms in response to social lobbying?

    <p>Perceived threat to profit from social lobbying (D)</p> Signup and view all the answers

    During which phase do regulators enforce new rules that can be legally challenged?

    <p>Implementation (A)</p> Signup and view all the answers

    What can lower the perceived costs of compliance for a company facing NGO demands?

    <p>More reasonable and flexible demands by the NGO (D)</p> Signup and view all the answers

    What is the main outcome of the Politicization phase?

    <p>Increased public awareness and engagement of politicians (D)</p> Signup and view all the answers

    What profile suggests higher returns on a campaign of social targeting?

    <p>Established brands with consumer-oriented products (A)</p> Signup and view all the answers

    What does the 0% to 100% compliance choice represent?

    <p>The potential profitability of compliance versus non-compliance (A)</p> Signup and view all the answers

    What is a characteristic of companies that are often targeted for social regulation?

    <p>Being the biggest sinner in their industry (B)</p> Signup and view all the answers

    What is the fixed cost for the established product?

    <p>4,207 (D)</p> Signup and view all the answers

    Which equation represents the revenue for the sustainability-oriented good?

    <p>R(Q) = (1,406 - 2.69Q) * Q (D)</p> Signup and view all the answers

    How is the optimal quantity (Q*) calculated for the sustainability-oriented product?

    <p>Q* = (346 - 1,406) / -2.69 (A)</p> Signup and view all the answers

    What is the gross margin for the established product based on the provided information?

    <p>48,600 (D)</p> Signup and view all the answers

    Which statement correctly describes the profit of both products?

    <p>The established product's profit is $44,393 while the sustainability-oriented product's is $103,284. (A)</p> Signup and view all the answers

    What does the variable cost for the established product represent in this context?

    <p>The cost incurred per unit produced (A)</p> Signup and view all the answers

    What is the potential profit increase when replacing the established product with the sustainability-oriented product?

    <p>58,891 (A)</p> Signup and view all the answers

    Which condition may affect the decision to adopt strategic sustainability?

    <p>The fixed cost of strategic sustainability exceeding the production cost (A)</p> Signup and view all the answers

    Study Notes

    Course Information

    • Course name: Business, Government, and Society
    • Course code: BUS-G202
    • Professor: Phil Powell
    • Topics covered: Business Analytics, Stakeholder Engagement, Asymmetric Information, Social Regulation, Social Innovation, and case studies (e.g., BlackRock, BlackRock: Linking Purpose to Profit, Greenpeace's Unfriend Coal Campaign and Facebook,Starbucks)

    Key Dates

    • Exam 3: Thursday, December 5th
    • Exam 3 deadline for AES accommodations: Wednesday, November 20th
    • Online Self-Test Quizzes 9 and 10 closes: TODAY, 11/5, 11:59pm
    • Nike case discussion opens: Thursday, 11/7, 12:01am
    • Facebook case discussion closes: Monday, 11/4, 11:59pm
    • Starbucks discussion - final case discussion: Monday, 12/2, 11:59pm

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    BUS-G202 Business, Government, and Society Lecture Notes - Topic 9 - Business Analytics

    Description

    This quiz explores the concept of strategic sustainability in the business context, focusing on its effects on gross margin, demand curves, competition, and stakeholder risks. Understand the requirements for firms to achieve sustainable practices and the implications for long-term value creation as suggested by leading financial firms like BlackRock.

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