Strategic Management Chapter 2 PDF

STRATEGIC MANAGEMENT CHAPTER 2 1. Point out which of the following forces a. Political Forces does not form part of Porter’s five forces b. Buyer Power model or competitive position analysis c. Supplier Power...

STRATEGIC MANAGEMENT CHAPTER 2 1. Point out which of the following forces a. Political Forces does not form part of Porter’s five forces b. Buyer Power model or competitive position analysis c. Supplier Power d. Threat of Substitutes 2. Evaluate what will likely happen if many a. Industry profits will increase new businesses will enter a particular b. Industry capacity will fall market c. The competitive rivalry will intensify d. Industries become profitable 3. Analyze which of these situations is likely a. Few large suppliers dominate the market forming a powerful to cause high bargaining power of oligopolistic bloc suppliers b. Many alternative sources of supply c. Switching costs from one supplier to another is low d. There are substitutes for a specialized source of supply 4. Analyze which of these situations is likely a. The buyer group consists of a few large buyers, and the seller to cause weaker bargaining power of group consists of numerous small firms buyers b. The number of buyers is small, such that each customer’s business trends tend to be particularly important to a seller c. The costs incurred by buyers in switching to competing brands or substituting products are relatively high d. Buyers are well informed about seller’s products, prices, and costs 5. Assess which of these situations results in a. When buyers are unlikely to integrate backward into the the weaker bargaining power of buyers business of sellers b. When the costs incurred by buyers in switching to competing brands or substituting products are relatively low c. When buyers have the ability to postpone purchases if they don’t like the prices offered by sellers d. When buyers are few in number and/or often purchase in large quantities 6. Assess each option as to which factor will a. If substitute products offer an attractive price-performance trade- result in a more serious threat from off to industry products substitute products b. The buyer’s cost of switching to the substitute is high c. If industry products offer and attractive price-performance trade- off to substitutes d. The suppliers cost of switching to the substitute is high 7. When there are no substitutes for a a. The statement is CORRECT specified raw material or input from b. The statement is WRONG suppliers, their bargaining power is high c. I don’t know the answer and strong 8. When switching costs from one supplier to a. The statement is CORRECT another are high, the supplier’s bargaining b. The statement is WRONG power is high and strong c. I don’t know the answer 9. When a few large suppliers dominate the a. The statement is CORRECT market where they form a powerful b. The statement is WRONG oligopolistic bloc would mean a high or c. I don’t know the answer strong bargaining power in favor of them 10. When buyers or customers of suppliers a. The statement is CORRECT are not united or fragmented, the b. The statement is WRONG bargaining power of suppliers is high and c. I don’t know the answer strong 11. When sellers’ products are not unique, a. The statement is CORRECT such that buyers or customers can b. The statement is WRONG replace or produce those products c. I don’t know the answer themselves, the bargaining power of customers is weak or low 12. When suppliers are fragmented or few, a. The statement is CORRECT and product switching among buyers or b. The statement is WRONG customers is easy, the bargaining power c. I don’t know the answer of buyers is weak or low 13. When there are many players in the a. The statement is CORRECT market with similar strategies, the b. The statement is WRONG competitive rivalry among players or firms c. I don’t know the answer is high 14. When the barriers to exit are high, the a. The statement is CORRECT competitive rivalry of firms is high b. The statement is WRONG c. I don’t know the answer 15. When incumbent firms in the market a. The statement is CORRECT produce better products, increase their b. The statement is WRONG efficiency, promote their brand image, c. I don’t know the answer enhance relationships with suppliers and  distributors, and pursue aggressive marketing strategies, they, in return, reduce threats of new entrants in the market 16. He developed the Five Forces Model a. Prof. Nam Joo-Hyuk b. Prof. Kim Seon-Ho c. Prof. Lee Do-Hyun d. Prof. Michael E. Porter 17. When the threat of entry is high, a. The statement is CORRECT incumbent firms’ ability to gain profits will b. The statement is WRONG be reduced because they will lower prices c. I don’t know the answer considering that their costs are high 18. When supplier power is high, incumbent a. The statement is CORRECT firms’ ability to gain profits will be reduced b. The statement is WRONG because their costs of raw materials are c. I don’t know the answer high 19. This term is defined as the group of firms a. Substitutes producing products that are close b. Industry substitutes for each other c. Conglomerates d. Complementary 20. Creating value is not enough for firms. a. The statement is CORRECT They must also be able to capture a b. The statement is WRONG significant share of the value created c. I don’t know the answer 21. What is the difference between what a. Price customers are willing to pay for a firm’s b. Cost products or services and the total cost of c. Economic Value producing these products or services? d. Competitive Advantage 22. A firm has a competitive advantage when a. The statement is CORRECT it can create more profit than rival firms b. The statement is WRONG c. I don’t know the answer 23. Firms can create economic value or profit a. Profit = Price – Cost by expanding as much as possible the b. Economic Value = Total Cost – Profit gap between perceived value the firm’s c. Profit = Economic Value – Cost product or service generates and the cost d. Cost = Fixed Cost + Variable Cost to produce. What formula best describes this situation? 24. This term is defined as fixed costs that a. Switching Costs buyers face when they change suppliers b. Variable Costs and may arise because a buyer who c. Fixed Costs switches vendors must, for example, alter d. Cost of Goods product specifications, retrain employees to use a new product, or modify processes or information systems 25. To Michael Porter, the lob of the strategist a. Understand and cope with competition is? b. Understand industry competition and profitability c. Understand the competitive forces and their underlying causes d. All of the above 26. The country’s unemployment rate is an a. Economic external force impacting which b. Social environment? c. Political d. Environment 27. Why is PESTEL analysis considered a. Because it looks at climate change “environmental scanning”? b. Because it considers environment setting c. Because it scans the environment for positive and negative factors d. Because it compares two different organizations against each other 28. The Work Place Health and Safety a. Environmental Factors legislation and codes of practice that a b. Political Factors business must consider are… c. Ecological Factors d. Legal Factors 29. An increase in the minimum wage may a. It will increase profits impact the business because… b. It will increase consumer products c. It will increase the total cost of the business d. It will increase customer 30. Consumer taste is what type of PESTEL a. Environmental factor? b. Ethical c. Technological d. None of the above 31. PESTEL analysis takes place in what a. Ecological Environment environment of the business? b. Macroenvironment c. Task Environment d. Microenvironment 32. By implementing the TRAIN law, a. Only statement 1 is correct 1. Businesses will increase profits b. Only statement 2 is correct because customer numbers will c. Both statements are correct increase d. Both statements are incorrect 2. Businesses will increase profits because the total cost of business will decrease 33. Putting or considering your business a. Environmental Factors target market values is what factors? b. Economic Factors c. Sociocultural Factors d. Technological Factors 34. A decrease in dollar value against the a. Decrease the profit of the business all businesses Philippine peso will… b. Increase in the profit of the businesses that do domestic products and services c. Increase the profit of the businesses that do international products and services d. None of the above 35. If the employment rate is low… a. More money will be spent on our economy b. Less money will be spent on our economy c. The economy will be stable d. None of the above 36. A rising interest rate is an… a. Economic factor that will increase the businesses’ profitability b. Economic factor that will decrease the businesses’ profitability c. Ecological factor that will increase the businesses’ profitability d. Ecological factor that will decrease the businesses’ profitability 37. Which of the following is not part of the a. Ecological Factors PESTEL Framework? b. Political Factors c. Educational Factors d. Legal Factors 38. Which of the following is not an economic a. Employment rate factor? b. Growth rate c. Interest rate d. None of the above 39. Statement 1: Deflation is an economic a. Only statement 1 is correct factor that will increase the country’s b. Only statement 2 is correct economy c. Both statements are correct Statement 2: Deflation is an economic d. Both statements are incorrect factor that is a serous threat to the economy 40. Which of the following are considered a. Weather and climate sociocultural factors b. Visa restrictions and tariffs c. Age and gender d. Currency inflation and interest rates 41. Which of the following is considered a. Interest rates economic factors b. Inflation c. Deflation d. All of the above 42. It’s the ability of the business to produce a. Market share quality products and services and sell b. Competitive advantage them at the highest possible price, and c. Positioning how the company is situated relative to its d. Brand leadership competitors is called… 43. An increase in production of goods or a. Ecological Factor improvement in services provided by b. Technological Factor business with the help of machines is c. Economic Factor a/an? d. Sociocultural Factor 44. PESTEL stands for c. Political, Economic, Sociocultural, Technological, Ecological, and Legal 45. Rice tariffication law is an example of a. Economic factor which PESTEL factor? b. Political factor c. Legal factor d. Sociocultural 46. The character and strength of the a. True competitive forces operating in an b. False industry are never the same from one c. Maybe industry to another 47. Environmental and ecological are a. True different factors b. False c. Maybe 48. It is a strategic framework commonly used a. PESTEL Analysis to evaluate the business environment in b. SWOT Analysis which a firm operates. c. Five Forces d. None of the above 49. Which of the following is not part of a a. Expansion business cycle? b. Contraction c. Through d. None of the above 50. A depreciated peso will? a. Increase the cost of the international products b. Decrease the profitability of businesses doing imports c. The imports will be more expensive d. All of the above