Strategic Management: Concepts and Cases 3rd Edition by Jeffrey H. Dyer Test bank
a) unique value
b) complimentary value
c) above-average profits
d) above-average losses
Answer: c
Difficulty: Easy
Section Reference 1: What Is Business Strategy?
Learning Objective 1: Define business strategy, including the importance of competitive advantage, the four choices that are critical to strategy formulation, and the strategic management process.
Bloomcode: Knowledge
Standard 1: AACSB || Analytic
8) The Mykari Publishing House invested in buying high-end machinery that allowed its newspapers to be printed at twice the speed of average printing machines. The executives of the company stated that this would increase the company’s profit margin by 12% as opposed to the usual 7 to 8% that it makes annually. When the finances of the company were tallied this year, it was found that the profits increased to about 19%. This scenario best illustrates ________.
a) return of equity
b) above-average profits
c) complimentary value
d) unique value
Answer: b
Difficulty: Hard
Section Reference 1: What Is Business Strategy?
Learning Objective 1: Define business strategy, including the importance of competitive advantage, the four choices that are critical to strategy formulation, and the strategic management process.
Bloomcode: Application
Standard 1: AACSB || Analytic
9) Which of the following is true of competitive advantage?
a) It requires a company to consistently outperform its rivals in generating above-average profits.
b) It should be avoided by not-for-profit organizations.
c) It is usually achieved by firms that provide general as well as imitable products.
d) It can be measured by using only tangible outcomes.
Answer: a
Difficulty: Medium
Section Reference 1: What Is Business Strategy?
Learning Objective 1: Define business strategy, including the importance of competitive advantage, the four choices that are critical to strategy formulation, and the strategic management process.
Bloomcode: Comprehension
Standard 1: AACSB || Analytic
10) Which of the following statements about risks is true?
a) Investing in a utility company that supplies power to customers, who have few alternative sources of power, can be very risky.
b) Investors take up risks every time when they are not sure if their investments will be a gain or a loss.
c) Investing in a stable firm is generally considered very risky even if it has a long history of profitability.
d) Investors faceless risk when they put their money into start-up companies that try to launch products based on new technologies.
Answer: b
Difficulty: Medium
Section Reference 1: What Is Business Strategy?
Learning Objective 1: Define business strategy, including the importance of competitive advantage, the four choices that are critical to strategy formulation, and the strategic management process.
Bloomcode: Comprehension
Standard 1: AACSB || Analytic
11) Which of the following is the main purpose of a strategic management process?
a) Ensuring that all employees have managers and supervisors to lead their teams
b) Creating an organization that functions systematically according to its vision, mission, and goals
c) Creating a high-level plan that can be implemented without fierce competition and undue risk
d) Specifying a high-level plan that an organization will employ to achieve competitive advantage
Answer: d
Difficulty: Medium
Section Reference 1: What Is Business Strategy?
Learning Objective 1: Define business strategy, including the importance of competitive advantage, the four choices that are critical to strategy formulation, and the strategic management process.
Bloomcode: Comprehension
Standard 1: AACSB || Analytic
12) The management of Neptune Inc. creates a definite plan of action that will surely create profits for the company. It allocates and sectionalizes its machinery and personnel. The main office is moved to a prime location that helps attract customers and facilitates competitive development. This plan of action helps Neptune Inc. retain its competitive advantage and has also grow as a company. Which of the following terms does this scenario best illustrate?
a) Strategic tools
b) Strategic management process
c) Functional strategy
d) Business unit strategy
Answer: b
Difficulty: Hard
Section Reference 1: What Is Business Strategy?
Learning Objective 1: Define business strategy, including the importance of competitive advantage, the four choices that are critical to strategy formulation, and the strategic management process.