Multiple choice questions:
1. Which of the following is not a part of a firm's external environment?
A) intellectual property
B) competitors
C) suppliers
D) government agencies
2. To a large extent, attitudes at the corporate level reflect the concerns of
A) stockholders and society at large
B) top managers
C) the CEO
D) the federal government
3. The ideal strategic management team includes decision makers from
A) all three company levels (corporate, business, and functional)
B) just the corporate level
C) just the corporate and business levels
D) just the top management
4. Which of the following is a major function of the strategic management model?
A) it helps make profits for the firm.
B) it helps in identifying key issues faced by the firm.
C) it helps in deciding which products to sell.
D) it depicts the sequence and relationships of the major components of the strategic management process.
5. Which of the following is a generic strategy option?
A) narrow margins
B) diversification
C) differentiation
D) retrenchment
6. Horizontal integration is an example of a
A) generic strategy
B) grand strategy
C) functional level strategy
D) SBU strategy
7. Strategic decisions ostensibly commit the firm for
A) 1-2 years
B) the short term
C) 3-4 years
D) a long period of time, typically five years
8. Three organizational elements providing fundamental, long-term means for institutionalizing a firm's strategy are:
A) leadership, power, culture
B) culture, structure, leadership
C) objectivity, power, culture
D) power, effectiveness, structure
E) none of the above
9. Forces and conditions that originate beyond and usually irrespective of any single firm's immediate operating environment and that provide the general economic, political, social, and technological framework within which competing organizations operate are called the:
A) remote environment
B) task environment
C) operating environment
D) internal environment
E) socio-cultural environment
10. The results which an organization seeks over a multi-year period are its:
A) grand strategies
B) long-term objectives
C) long-term strategies
D) short-term goals
E) tactics
11. The general plan of major actions through which a firm intends to achieve its long-term objectives is called its:
A) corporate plan
B) long-term goal
C) grand strategy
D) mission
12. Functional managers are typically responsible for which of the following?
A) achieving annual objectives
B) selecting grand strategies
C) formulating the strategic plan
D) the mission statement
E) corporate goals
13. The doubling of EPS (earnings per share) within five years with increases in each intervening year is called a(n):
A) long-term goal
B) long-term objective
C) short-term goal
D) short-term objective
E) operating goal
14. Which of the following is not an economic goal that guides the strategic direction of almost every business organization?
A) survival
B) growth
C) profitability
D) market share
15. Which of the following is not a principal reason why managers should be concerned about the socially responsible behavior of their firms?
A) a company's right to exist depends on its responsiveness to the external environment.
B) Federal, state, and local governments threaten increased regulation if business does not evolve to meet changing social standards.
C) a responsive corporate social policy may enhance a firm's long-term viability.
D) Federal laws demand that firms behave in a socially responsible way.
16. Which of the following is a broad trend driving businesses to adopt CSR frameworks?
A) the resurgence of environmentalism.
B) stockholders demand CSR.
C) Federal laws demand companies to adopt CSR.
D) increasing supplier power.
17. One factor of continued success is the extent to which a firm can relate functionally to the external environment. To accomplish this the firm must have:
A) infinite sources of capital for expansion
B) a realistic self-concept
C) specific objectives and job descriptions
D) community involvement
E) legislative lobby groups
18. The mission attempts to
A) ensure unanimity of purpose
B) sets policy
C) creates a board of directors
D) identify stakeholders
E) none of the above
19. The mission reflects the:
A) values of decision makers
B) goals of decision makers
C) experiences of decision makers
D) policies of the firm
E) none of the above
20. Which of the following is indispensable to the mission?
A) primary goal
B) primary market
C) primary area
D) specify basic price
21. The need to invest large financial resources in order to compete creates
A) increased supplier power
B) increased buyer power
C) increased jockeying for position
D) a barrier to entry
22. The external environment can be divided into various subcategories:
A) remote, political, social
B) remote social, operating
C) remote, industry, operating
D) technological and social
E) open and closed
23. Three factors are mentioned which affect a firm's access to needed personnel. One of these factors is:
A) geographic location
B) employee benefits
C) national employment rates
D) availability of skills
E) employee demographics
24. A valuable result of task environment analysis with respect to geographic, demographic, psychographic and buyer-behavior factors is called:
A) market share analysis
B) customer profile
C) competitive edge
D) consumer surveys
E) marketing consultation
25. Business is now being held responsible for:
A) using only underground dumping sites
B) cleaning up its previous environmental damage
C) municipal sewer systems
D) ensuring that a "thermal blanket" is created
E) continuing the "greenhouse effect"
26. When we consider the level of disposable income, we are normally considering:
A) technological factors
B) economic factors
C) political factors
D) social factors
E) modernity factors
27. According to Michael Porter's Model, the level of competition within an industry depends on how many basic forces?
A) 3
B) 2
C) 5
D) 8
E) 10
28. Economies of scale in an industry refers to:
A) savings that companies within the industry achieve due to increased volume
B) declining average short-run costs per unit
C) improved contractual agreements with suppliers in the near term
D) decreased barriers to entry to new firms attempting to enter the industry
E) as production increases so do costs per unit
29. Perceived differentiation results from:
A) the way firms position their products in the market
B) persuading customers that the company's products are slightly different from the competition
C) production and financial strategies
D) a lessening of competition
E) a competitive advantage new firms have as they attempt to enter the market
30. An expiration of a major industry patent would:
A) increase barriers to entry
B) decrease barriers to entry
C) leave barriers to entry unaffected
D) increase supplier power
E) decrease supplier power
31. A company can improve its strategic posture by:
A) finding suppliers who possess high power
B) finding buyers who possess high power
C) finding buyers who possess low power
D) ignoring substitute products
E) reserving capital
32. A buyer group is powerful if:
A) sellers are few in numbers
B) the products it purchases from the industry are unique
C) it earns low profits
D) the product is cheap
E) buyers can not integrate backwards
33. Which of the following is a causal model of forecasting?
A) sales force estimates
B) juries of executive opinion
C) scenario development
D) multiple regression
34. Which forecasting method helps prepare strategic managers for alternative possibilities?
A) econometric models
B) quantitative models
C) scenario development
D) Delphi method
35. Linear, exponential, and S-curve type projections are derived from:
A) time series models
B) the Delphi technique
C) scenario development
D) regression analysis
E) permutation
36. The model most applicable when historical data are not available or when they are hard to use is:
A) the time series model
B) the judgmental model
C) the customer survey
D) the econometric model
E) focus group synthesis
37. The major function of the strategic manager is dealing with:
A) systematic risk
B) business risk
C) uncertainty
D) certainty
E) predictable variations
38. Delphi is a(n):
A) quantitative method
B) economic method
C) judgment method
D) social method
E) none of the above
39. Which of the following is a causal forecasting approach?
A) econometric model
B) scenario development
C) brainstorming
D) the Delphi technique
E) focus groups
40. The model which assumes that the future will be a continuation of the past following some long-range trend is:
A) time series analysis
B) regression analysis
C) survey
D) the Delphi technique
E) lag modeling
41. Internal analysis of the firm is characterized by:
A) identification of the major internal capabilities of the firm
B) identification of all the internal capabilities of the firm
C) evaluation of the internal capabilities of the firm
D) A and C
E) none of the above
42. The identification and evaluation of strategic internal factors are:
A) two distinct steps pursued by strategic managers
B) interdependent and not always distinctly separate steps
C) two critical components for effective environmental analysis
D) B and C
E) none of the above
43. In the evaluation of strategic internal factors, strategists should use:
A) historical experience
B) industry/competitor comparison
C) normative judgment
D) all of the above
E) none of the above
44. To develop or revise a strategy, managers seek to identify the key factors on which success will most likely depend. The internal factors most likely to be associated with success will vary by:
A) industry
B) product life cycle
C) the firm's current position
D) all of the above
E) none of the above
45. Brand name is an example of:
A) a tangible asset
B) an organizational capability
C) a value chain of activity
D) an intangible asset
E) none of the above
46. Which of the following is not a "support" activity associated with the value chain approach?
A) inbound logistics
B) procurement
C) firm infrastructure
D) technology development
47. Which of the following are intended to provide benchmarks for the evaluation of the company's progress in achieving its aim?
A) mission
B) long-term objectives
C) grand strategies
D) business policies
E) functional strategies
48. Which of the following does not describe a good objective?
A) flexible
B) acceptable
C) marketable
D) achievable
E) understandable
49. A differentiation strategy is characterized by:
A) sustained capital investment
B) strong basic R&D and a reputation for quality
C) excellent process engineering, intense supervision of labor
D) low cost distribution
E) none of the above
50. Under changing conditions, concentrated growth is characterized as:
A) higher risk
B) lower risk
C) decreasing resource needs
D) decreasing revenues
E) none of the above
51. If a shirt manufacturer acquires a textile manufacturer, this strategy is called:
A) backward vertical integration
B) diversification
C) horizontal integration
D) integration (pure)
E) joint venture
52. __________________are partnerships that exist for a defined period during which partners contribute their skills and expertise to a cooperative project.
A) licensing agreements
B) franchising agreements
C) export agreements
D) strategic alliances
E) none of the above
53. Which of the following qualities of an objective improves its chances of being attained?
A) timeliness
B) flexibility
C) cost-efficient
D) groundbreaking
E) none of the above
54. When a firm attempts to persuade its creditors to temporarily freeze their claims while it undertakes to reorganize and rebuild its operations more profitably, this form of bankruptcy is called:
A) reorganizational bankruptcy
B) liquidation bankruptcy
C) partial bankruptcy
D) organizational bankruptcy
E) none of the above
55. Occasionally two or more capable companies lack a necessary component for success in a particular competitive environment. The optimal strategy in such a case would be:
A) concentric integration
B) diversification
C) concentration
D) joint venture
E) conglomerate diversification
56. When diversification involves additions of a business to the firm in terms of technology, markets, or products, it involves:
A) concentrated growth
B) horizontal integration
C) concentric diversification
D) vertical diversification
E) joint venture
57. Specific options under the concentration grand strategy include which of the following?
A) opening additional geographic markets
B) increasing present customers' rate of usage
C) developing new products
D) selling to a differentiated customer
E) none of the above
58. Specific approaches to the grand strategy of market development include which of the following?
A) entering additional channels of distribution
B) attracting competitors' customers
C) reducing prices
D) attracting non-users
E) none of the above
59. Creating a new product life cycle is the underlying philosophy of a grand strategy of:
A) product development
B) innovation
C) market development
D) vertical integration
E) horizontal integration
60. According to researchers, the grand strategies of retrenchment/turnaround are most often accomplished in extreme circumstances through which of the following?
A) cost reductions
B) asset reductions
C) changes in top management
D) diversification
E) joint ventures