GM105 testbank with complete solution
1. Keeping in mind Apple's competitive advantage, which of the following products was introduced by Apple in 2007? Iphone
2. is best described as an integrative management field that combines analysis, formulation, and implementation in the quest for comp...
gm105 testbank with complete solution 1 keeping in mind apples competitive advantage
which of the following products was introduced by apple in 2007 iphone 2 is best described as an integra
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GM105 testbank with complete solution
1. Keeping in mind Apple's competitive advantage, which of the following products was
introduced by Apple in 2007? Iphone
2. is best described as an integrative management field that combines analysis,
formulation, and implementation in the quest for competitive advantage. Strategic
management
3. is best described as a set of goal-directed actions a firm takes to gain and sustain
superior performance relative to competitors. Strategy
4. Which of the following stages of the strategic management process involves an evaluation
of a firm's external and internal environments? Strategy analysis
5. In , a firm frames a guiding policy to address the competitive challenge. Strategy
formulation
6. Through , a firm puts its guiding policy into practice by employing a set of coherent
actions. Strategy implementation
7. A firm that achieves superior performance relative to other firms in the same industry or
the industry average has a(n) . Competitive advantage
8. Cadia Foods Inc. was the first company to start selling energy drinks in its country—a
product that gained popularity among diverse groups. Soon, other companies started to sell
their own brands of energy drinks, thereby giving Cadia Foods ample competition. In
response, Cadia Foods decided to limit its variety of energy drinks to only two. However, it
ensured that these two flavors were free of calories and low in cost. With this innovation,
Cadia Foods Inc. consistently outperformed its competitors for ten years. In this scenario,
Cadia Foods Inc. has maintained a through its innovative strategy. Sustainable
competitive advantage
9. Which of the following scenarios illustrates a firm that has a sustainable competitive
advantage? TrueLink Corp. was able to hold its market share of 68 percent in the social
networking industry for more than three years.
10. If SA Pharmaceuticals obtains an 18 percent return on invested capital, which of the
following will help determine if it has a competitive advantage over other pharmaceutical
companies? Comparing the return to the return on invested capital obtained by other firms
in the industry
11. Underperformance relative to other firms in the same industry or the industry average
results in a(n) for a firm. Competitive disadvantage
12. New Communications Inc. is a newspaper publishing company whose average return on
invested capital is approximately 5 percent. Because newspaper publishing is a declining
industry, the industry average has been negative (-5 percent) for the last few years. In this
scenario, New Communications Inc. has a . Competitive advantage
13. Exis Inc. and Stelma Inc. are two companies that have been manufacturing typewriters
for almost 30 years. Due to the reduced demand for typewriters today, both companies'
average return on invested capital is approximately -5 percent. The current industry average
is 2 percent. In this scenario, Exis Inc. and Stelma Inc. most likely have: competitive parity
with each other
,14. The average cost of production for a bottle of vitamin water in the industry is $4 while its
average price is $7. StoreAll Inc. manufactures the same product for $3 per bottle and sells
it for $7 per bottle. Which of the following statements is most likely true of StoreAll Inc. in
this scenario? It has a competitive advantage in the industry.
15. A firm is said to gain a competitive advantage when it can: provide products similar to its
competitors, but at lower prices.
16. FindFor Inc. is an e-commerce retail firm that sells a variety of merchandise online.
Through services like cash on delivery, easy return, and online tracking, the company has
created more customer value than its competitors (brick-and-mortar businesses) at the
same price. Also, the company's costs are substantially low due to minimal investment in
operation and administration. In this scenario, FindFor Inc. has most likely been able to
provide superior value and cost control through . Strtategic positioning
17. When a firm adopts a differentiation strategy to attain competitive advantage, it focuses
on: delivering unique features to its customers.
18. True Cinemas Inc. and Digi Future Inc. are two companies that own and run movie
theaters in malls and other commercial areas. While True Cinemas Inc. pursues a cost-
leadership strategy, Digi Future Inc. adopts a differentiation strategy. Which of the following
statements is most likely true of this scenario? Digi Future and True Cinemas will not be
direct competitors to each other and their customer segments will overlap very little.
19. For a firm that operates in an industry where competition is high, which of the following
practices will result in inferior performance? Trying to be everything to everybody by
combining different competitive strategies.
20. If a company wants to gain a competitive advantage in a highly competitive industry, it
should ideally: stake out a unique position within the industry.
21. TakeFlight Airways is a new entrant to the airline industry. While most of its competitors
are pursuing a cost-leadership strategy, TakeFlight Airways has decided to execute a
differentiation strategy. Which of the following is the most likely implication of this
decision? TakeFlight Airways will create value for customers by delivering unique features.
22. Pink Couture Inc. and Pink Blush Inc. are two companies in the apparel industry. While
Pink Couture Inc. focuses on providing unique product features and superior customer
service, Pink Blush Inc. focuses on low prices and minimal customer service. Both companies
have been able to gain a competitive advantage. This is most likely because: the companies
have pursued distinct strategic positions
23. Which of the following is an implication of all firms in an industry pursuing a low-cost
position through application of competitive benchmarking? The firms would eventually have
no resources to invest in product and process improvements.
24. Which of the following statements should ideally reflect a firm's strategy for competitive
advantage? Our aim is to create superior customer value while controlling costs.
25. Which of the following factors most effectively contributed to the success of JetBlue
airlines in comparison to other airlines like Delta, United, or American? Its point-to-point
business model
26. Which of the following statements about strategy is NOT true? Operational effectiveness
and competitive benchmarking should be treated as strategy.
27. Industry effects describe the underlying structure of the industry. economic
28. Which of the following statements accurately describes firm effects? They attribute firm
performance to the actions managers take within a chosen industry.
29. Which of the following forces tends to be more important in determining a firm's
performance? The actions of managers within the firm
,30. A company wants to determine how industry effects have affected its profitability. Which
of the following elements should the company focus on? The barriers to entry and exit within
the industry
31. Which of the following forces is most closely related to industry effects within the
automobile industry? The types of products and the services offered within the industry
32. are incidents that describe highly improbable but high impact events. Black swan
events
33. Shortly after the small island of Balamia experienced multiple unexpected high-intensity
earthquakes that caused massive destruction, many banks and insurance companies filed
for bankruptcy. This left the economy of the country in a poor state. The natural calamity in
Balamia best exemplifies . A black swan event
34. Due to several black swan events in the past, the: implicit trust relationship between the
corporate world and society at large has deteriorated.
35. When the strong dictatorial rule in Canria unexpectedly collapsed due to the shocking
mass murder of the royal family, the nation's economy experienced drastic changes. The
laws became more restrictive, the country lost many locally produced resources and
products, and the distribution of wealth became inequitable. The unexpect ed event that led
to these changes can best be described as a(n) event. Black swan
36. In the United States, which of the following was born out of dissatisfaction with the
capitalist system in 2011? The Occupy movement
37. Which of the following was a key driver in the Occupy movement of 2011? The issue of
income disparity
38. The past black swan events in the United States demonstrate that: Managerial actions
can affect the economic well-being of large numbers of people around the globe.
39. Derek, a retired CEO, invests capital in a start-up company that creates mobile
applications. He mentors the entrepreneur and the employees of the company because he
wants the company to perform well and survive in the market. Thus, Derek is the start-up
company's . Stakeholder
40. Pure Food Inc., a multinational company, relies on its media partner Radio Ex to regularly
advertise its offers, sales, and new products. Radio Ex is invested in this relationship
because it generates most of its revenue from advertising Pure Food's products. In this
scenario, Radio Ex is Pure Food Inc.'s . External stakeholder
41. Which of the following is an example of a firm's external stakeholder? Customers
42. Which of the following is NOT an example of a software company's external
stakeholder? Project managers
43. Rachel owns a large portion of GM Cube Inc.'s stocks. However, she is not employed by
the company. In this scenario, Rachel is the company's . Internal stakeholder
44. Sun Inc., a vendor, regularly supplies pallets to Octangle Corp. for its shipping business.
Therefore, Sun Inc. is Octangle Corp.'s . External stakeholder
45. State-level government agencies that check whether firms are meeting statutory safety
measures in their production units are considered to be the firms' . External
stakeholders
46. Which of the following best qualifies as a firm's internal stakeholder? A manager taking
care of the firm’s operations in a foreign market
47. The best example of a firm's external stakeholder is a(n): government agency that
regulates the prices of products manufactured by the firm.
48. The interaction between a firm and its diverse internal and external stakeholders is best
described as a(n): exchange relationship
49. Stakeholder strategy is an integrative approach to managing a diverse set of
stakeholders effectively in order to . Gain and sustain competitive advantage
50. A firm's stakeholder strategy primarily allows the firm to: analyze and manage how
various external and internal stakeholders interact to jointly create and trade value.
51. A core tenet of stakeholder strategy is that a: single-minded focus on shareholders alone
exposes a firm to undue risks that can threaten the very survival of the enterprise.
52. In a firm, a strategist's job should be to: understand the complex web of exchange
, relationships among different stakeholders.
53. RedSteel Corp. has been able to gain and sustain a competitive advantage due to its
strong relationship with its employees, customers, suppliers, and local communities. The
company believes in lifetime employment and ensures that its employees grow along with
the company. Investors are more than satisfied with the returns on their investments. Also, 3
percent of the company's profit is spent on community development. With initiatives like
these, customers feel privileged to associate themselves with RedSteel products. This
scenario best illustrates the implementation of a . Stakeholder strategy
54. Which of the following scenarios best illustrates a good stakeholder strategy? PA Corp.
distributes only 70 percent of its annual profit after tax to shareholders, while the remaining
is distributed among employees and the local community, and invested for further research.
55. provides a decision tool that enables a firm to act as a good corporate citizen by
allowing its managers to recognize, prioritize, and address the needs of different groups of
individuals who take personal interest in the firm's performance and survival. Stakeholder
impact analysis
56. Which of the following is NOT a stakeholder attribute that managers consider during
stakeholder impact analysis? A stakeholder’s liquidity
57. Stakeholder impact analysis primarily helps a firm: gain a competitive advantage while
acting as a good corporate citizen.
58. The first step in stakeholder impact analysis involves: identifying the stakeholders that
currently have, or potentially can have, a material effect on a company.
59. Which of the following groups is considered to be the primary stakeholder for public-
stock companies? Suppliers of capital
60. After a firm has identified its key stakeholders in stakeholder impact analysis, the
immediate next step is to: identify stakeholders’ interests and claims
61. As the legal owners, have the most legitimate claim on a company's
profits. Shareholders
62. The management of Five Square Corp. wants to reduce the separation between
ownership (by shareholders) and control of the firm (by professional managers). Which of
the following practices would best help the company do this? Allowing employees to
purchase the stock of the company at a discounted rate
63. The board at Unicore Systems Corp. has decided to allocate 20 percent of the company's
shares to its workforce, at a discounted price. Apart from being a valued investment, the
plan will allow the employees to take personal responsibility for the firm's performance.
Which of the following employee incentive schemes does this best illustrate? Employee
stock ownership plan
64. Which of the following statements about a firm's stakeholders is true? Within stakeholder
groups there can be significant variation in the power a stakeholder may exert on a firm.
65. Institutional investors have more sway in public companies than individual investors
because of the size of their . Assets under management (AUM)
66. Which of the following does NOT accurately explain why institutional investors are much
more potent stakeholders than individual investors? While institutional investors are external
stakeholders of a firm, individual investors are internal stakeholders.
67. Which of the following is step 3 in the five-step process of stakeholder impact
analysis? Identifying the opportunities and threats the stakeholders present
68. is best described as a framework that helps firms recognize and address the
economic, legal, social, and philanthropic expectations that society has of the business
enterprise at a given point in time. Corporate social responsibility
69. In stakeholder impact analysis, identifying the opportunities and threats presented by
stakeholders is immediately followed by: recognizing the economic, legal, ethical, and
philanthropic responsibilities of the firm to its stakeholders.
70. Which of the following statements accurately describes corporate social responsibility
(CSR)? CSR provides a conceptual model that more completely describes a society’s
expectations.
71. Paying taxes to local government authorities from the annual revenues generated by a
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