1. A highly capable brick and mortar electronics retailer with a l.docx
- 1. 1. A highly capable brick and mortar electronics retailer with a loyal regional customer base (such as Fry's) should adopt which of the following medium term strategies? "50% off" sale every month Divest Niche or harvest Invest in R&D 2. Amazon's strategy involves offering expanded variety but at very competitive prices. This is primarily achieved through Economies of scope Focus on international markets
- 2. Economies of scale Innovative products 3. Uber is an example of industry chaining in which of the following ways? Economies of scale for service providers Economies of scope for customers Improving access and reduced search costs for customers and service providers Lower wages for service providers and lower prices for customers 4. Shareholder returns are primarily derived from
- 3. Growth in share value and dividend payments dividend payments only Growth in company profits Growth in the share value only 5. Strategy is defined best as: A unique value proposition supported by sound financial decisions A unique value proposition supported by synergies in operations A unique value proposition supported by aggressive marketing A unique value proposition supported by a complex supply chain 6. The cost of attracting new customers is the highest with which of the following groups? Early adopters Late majority
- 4. Laggards Innovators 7. In the context of the Differentiation (Quality) vs Efficiency trade-off curve, the efficient frontier refers to: The company that provides maximum quality for a given cost The company that provides minimum cost The company that provides maximum quality The company that maximizes efficiency 8. Nike hiring sports stars to be brand ambassadors is an example of which of the following mechanisms? Market development Customer segmentation Product development Market penetration 9. Which of the following is an indication of strategic committment of a company in an industry
- 5. Lowering wages of the workforce Increased technology investment Acquiring real-estate in an urban location of demand Increased divident payments for two years in a row 10. A pharma company with a deep roster of capable engineers and scientists and that is the market leader is best advised to begin development of a new drug as: A partnership with smaller competitors License its innovation from other laboratories An independent venture Smaller scale effort 11. The most valuable competency in the declining phase of an industry is: Resposiveness Innovation Efficiency
- 6. Quality 12. There is often limited capacity relative to demand in the early growth period of an industry because: Capacity is very expensive in the later stages of an industry Only few companies have products or technologies in a budding industry Prices tend to be low in the embryonic stage Many companies compete for early advantage in an emerging industry 13. If the willingness to pay of a customer for an automobile is $18000, and the cost to produce that automobile is $14000, the consumer surplus is: Less that $4000 $4000 Cannot be determined with data provided More than $4000 14. A short term profit maximizing strategy for a monopoly would focus on:
- 7. Giving slightly greater surplus than the competitor Maximizing consumer surplus Minimizing consumer surplus Ensuring the lowest possible cost of the product 15. Which of the following companies best exemplifies broad cost leadership? WalMart Toyota Costco Amazon 16. Tesla's business model can be best described as: Electric vehicles and services for the technology savvy drivers with advanced engineering and in-house manufacturing Electric vehicles and services for the technology savvy drivers with an outsourced model of design and manufacturing
- 8. Electric vehicles and services for the technology averse drivers with advanced engineering and in-house manufacturing Electric vehicles and services for the budget conscious drivers with advanced engineering and in-house manufacturing 17. Network amplifiers are critical in establishing a standard (in a technology context) because: Higher end customers have a greater voice Vertical integration is no longer a feasible option for most companies Rate of adoption is a critical factor Ease of use is paramount for any technology 18. Incumbents typically have a cost advantage as compared to new entrants becuase: Incumbents typically have a technogical edge compared to new entrants Incumbents have deeper connections to government and regulatory bodies Incumbents have greater fixed costs but lower variable relative to new entrants typically
- 9. Incumbent market shares lead to greater economies of scale 19. Porter's Five forces helps with all of the following objectives except: Evaluate the attractiveness of an industry Decide entry or exit from an industry Evaluate the strengths and weaknesses of a firm Evaluate opportunities and threats 20. In the context of the Differentiation (Quality) vs Efficiency trade-off curve, Amazon is best described as a company: Just below and to the left of the efficient frontier On the same frontier but a different position compared to brick and mortar competitors A company that values quality over price every single day That has been a value innovator 21. Which of the following best describes a mission statement?
- 10. An objective for a company to be debt free in 5 years A children's clothing store aiming to make a difference in their customer's lives An energy company wanting to be the most sustainable company on the planet A car company wanting to change customers' behavior into to a more sustainable lifestyle 22. According to the Mintzberg model of strategy development: Most unplanned strategies lead to failures on a global scale Most realized strategies are serendipitous and in response to evolving markets Startups often engage in planning emergent strategies Most realized strategies are carefully planned and executed in advance 23. The most valuable competency in the embryonic phase of an industry is: Resposiveness
- 11. Efficiency Innovation Quality 24. Which of the following companies best exemplifies broad differentiation? Volkswagen Amazon WalMart Costco 25. Which of the following provides longer term competitive advantage when it comes to efficiency: Experience effect Economies of scale Relentless focus on lowering labor related costs Learning effect 26. An equation that best describes customer valuation is:
- 12. Price/Quality Quality/Procuct Price Quality/Procuct Cost Product Cost x Quality 27. The best possible context within which to apply Porter's Five Forces model is for: Market segment Industry Sector Strategic group 28. The biggest impediment to an industry's consolidation is: Lack of scale economies Lack of adequate demand
- 13. Poor management Lack of skilled resources 29. The efficient frontier has a concave shape (i.e. a bulging shape) because: Greater levels of efficiency come at a steep cost but only for high-end segments It costs progressively more for every increment in quality levels Quality is free at lower levels of quality There is a quadratic relationship between higher quality and efficiency 30. High-tech companies can be distinguished from low-tech companies primarily based on: Level of fixed cost committment Higher price premiums for high-tech firms Extent of digital or on-line business transactions Price to earnings ratios 31. Subway restaurants is able lower variety related costs primarily through :
- 14. Modular design of its service Choosing franchise partners carefully Extensive franchising Allowing customers to customize their sandwich 32. Strategy formulation and execution is ultimately a service to: Customers Shareholders Employees Government regulators 33. Effective marketing directly contributes to a firm's efficiency objective by Reducing the cost of serving the average customer Providing insight into customer expectations
- 15. Improving the market share among higher-end customers Increasing the willingness to pay of customers 34. Which of the following companies best exemplifies focus differentiation? Costco Amazon Apple WalMart 35. Which of the following companies best exemplifies a blue ocean strategy? Fedex Costco Tesla Uber 36. A key feature of the cereal industry in recent years has been:
- 16. National as opposed to global competition Lower prices to attract customers Fewer store brand competitors Product proliferation 37. Which of the following best exemplifies a capability for a company? Low price Supply chain management Financial reserves Ideal positioning 38. Absolute cost advantages for incumbents (over new entrants to an industry) typically derive from: Higher levels of experience Control of inputs
- 17. Economies of scale from market share All of the above 39. Amazon.com is a great example of a company that has consistently delivered: Spectacular profit growth Profits year over year Above average return on investment Above average share value appreciation 40. Costco's strategy with respect to pricing of its products and services can best be described as: Ensuring the lowest total cost of the product within the market Increasing consumer surplus no matter the segment or product Reducing consumer surplus even at the expense of quality Charging higher prices to boost marginal profits