Practice exams Strategic Management - RUG
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Which characteristics describe monopolistic or imperfect competition?
Some to vary few firms, high differentiation of products
Some to vary few firms, low differentiation of products
Many firms, no differentiation of products
Many firms, some differentiation of products
According to the lectures, which of the following best describes the relationship between Porter’s Five Forces analysis and the PEST analysis?
A PEST analysis focuses on process issues while a Five Forces analysis focuses on content issues.
A Five Forces analysis describes the industry (i.e., the micro-economic environment) that the firm is in, while a PEST describes the broader (macro-economic) environment that the industry is in
A Five Forces analysis describes the external environment, while PEST analysis describes the internal environment of the firm
The findings from a Five Forces analysis provide the input (the data) for a PEST analysis
According to the lecture on organizational learning, which term refers to key individuals or interest groups using their power to prevent change and maintain the status quo?
Co-evolutionism
Institutionalism
Neo-institutionalism
Isomorphism
What strategic options in decision-making are available to organizations that have a low knowledge of new markets, but have high capabilities?
No options
Trade options
Bounded options
Full set of options
Imagine an SBU within a corporate portfolio that has the second largest market share in a mature market. According to the lecture on the BCG-matrix, this SBU would be a:
Dog
Questionmark
Cash cow
Star
Henderson and Clark (1990) review two kinds of dynamic processes in modular systems: modular innovation and architectural innovation. Which statement(s) is (are) true?
I Modular innovation retains the architecture of the network, including its joints, but modifies the modules. The changes occur in innovations and improvements of the modular components.
II In architectural innovation, the modules are largely unchanged, but the architecture that connects them (the jointing system) is changed. The speed of innovation can be fast, as a key part of the system, the modular structure, is retained. New joints between these modules are installed.
Only statement I is true
Only statement II is true
Both statements are true
Both statements are false
Which statement(s) is (are) true with regard to decision-making?
I Planning facilitates decision makers in analyzing and codifying what appear initially as complex problems. Planning processes help decision makers identify key performance indicators by which progress of the decision can be monitored and judged.
II The chaos perspective on decision-making does not seek to simplify and reduce uncertainty. It avoids over-simplification of the process and allows decision makers to appreciate and expect the role of politics and influence to be a natural part of decision-making process.
Only statement I is true
Only statement II is true
Both statements are true
Both statements are false
According to the lecture, the chairperson is a two-tier board is in principle
Not the CEO
A non-executive
A outsider
All of the above
What is meant by customer surplus?
When the product is more valuable to the consumer than the price he/she pays for it
The amount of new customers the firm attracts by introducing a new product
The excess demand by customers caused by applying a differentiation strategy
There are many substitution possibilities available to the customers
Which is NOT a limitation of risk analysis techniques?
Models can be over-reliant on past relations between variables which may not hold true for the current or future situations
Models may exclude important variables and parameters
They can easily be interpreted as being falsely precise (since they are numerically complex)
They use soft factors such as cultural and social differences, which are very rich but might be irrelevant to success or failure.
Which of the following refers to a set of firm-specific skills and processes directed towards the attainment of competitive advantage?
Core competences
Differentiation strategy
Business model
Competitive scope
Which of the following is NOT one of the types of strategic alliances found amongst non-competing firms?
Vertical partnership
Co-opetition
Joint ventures
Cross-industry agreements
What are the underlying assumptions of game theories?
Players are assumed to have perfect knowledge of the rules (shared equally between them)
Players are always want to maximize their returns
Players are assumed to be rational in their choices and behaviors
All of the above
What is NOT one of the criticisms by Doyle (2000) against the use of accounting-based performance metrics?
Managers and analysts use accounting earnings and accounting profits as a benchmark only because financial accounts are readily available and the measures, themselves, are easy to calculate
Accounting profits exclude investments, ignore the time value of money and produce a focus on short-term results
Managers may uncritically focus on accounting numbers without recognizing the judgments, conventions and realities involved in the construction of those numbers
The measurement of accounting earnings can be arbitrary, subjective and easily manipulated by management
Which of the following statements illustrates “oppo rtunity costs”?
The essence of strategy is taking the opportunity to perform activities differently from rivals
Strategic positions provide windows of opportunities
Strategic choice should focus on return on investment by maximizing opportunity costs
A dollar invested ‘here’ is a dollar not invested ‘ there’,
What can be reasons why relationships between subordinate managers and corporate (senior) managers are often mis-aligned?
Subordinate managers want to preserve autonomy and not be wholly controlled by senior managers
Subordinate managers may be looking to be promoted to senior levels
Subordinate managers act in ways which enhance their prospects of promotion rather than effective strategy execution
All of the above reasons
In the 1870s the QWERTY configuration was selected by the creators of the TypeWriter brand in order to slow down typists so as to reduce jamming of the keys. The Dvorak layout patented in 1932 is a more efficient layout and allows faster typing. The fact that the slower QWERTY system still dominates the market can be explained in terms of:
Opportunity costs
Switching costs
Sunk costs
Moore’s law
Which statement(s) is (are) true with regard to competition?
Perfectly competitive markets are characterized by free entry, perfect information and commodity-like products. The consequences of such “ perfect” competition is that price is the only competitive variable, that firms are essentially identical and, therefore, that there are no super-normal profits to be had.
Imperfections in markets provide the possibility for rents (super-normal profits) and rent-seeking activities. Imperfections could be, for example, differences in information about production possibilities, or consumer ignorance about product benefits.
Only statement I is true
Only statement II is true
Both statements are true
Both statements are false
Senge (1990) emphasizes the importance of what he calls “adaptive learning” and “generative learning”. Which of the following statements regard ing organizational learning is true?
Adaptive learning is similar to single-loop learning
Generative learning is similar to single-loop learning
In double-loop learning, individuals, groups and organizations adjust their behavior according to fixed organizational goals, norms and assumptions
In single-loop learning, organizational goals, norms and assumptions as well as behavior are all open to change
Which statement(s) is (are) true with regard to pricing, price elasticity, costs and profits?
With a cost advantage and high price elasticity, it pays to under-price competitors to gain share
With a differentiation advantage and high price elasticity, it pays to maintain price parity (same price as rivals) and rely on the differentiation advantage to increase market share
With a cost advantage and low price elasticity, a margin strategy involves maintaining price parity with rivals and relying on fatter profits margins to generate superior performance
All of the above mentioned statements are true
Which of the following is a motive for acquisition?
Getting rid of competitors from an over-saturated industry
Rapidly acquiring new skills
Gaining access to new markets
All of the above
Which types of organizations have relatively little need for ling-term scenario analysis?
Those operating in hypercompetitive environments classified by high levels of ambiguity
Those that maintain high levels of flexibility and are able to react quickly to any changes
Those operating in competitive environments classified by high levels of uncertainty
Those unable to react quickly and effectively to changing events as they occur
According to the lecture on strategic groups, what is true about mobility barriers?
Barriers don’t make a position profitable, but they do allow existing profits to be sustained
Barriers trigger rapid growth in marketshare
Barriers are what make niches profitable and sustain those profits over time
None of the above
According to the lecture material on decision-making processes, which of the following is one of the characteristics of wicked problems?
A low level of interconnectedness
Frequent repetition
A high level of uncertainty
A low level of complexity
Which of the following statements is (are) true?
Only statement I is true
Only statement II is true
Both statements are true
Both statements are false
According to the lecture, which of the following is NOT advisable for businesses in the new economy?
Emphasize the protection of intellectual property rights
Use inverse pricing (the best product is sold at the lowest price)
Use of open standards
Manage expectations
Which statement(s) is (are) true?
According to McGee et al. strategic planning is the process by which the firm organizes its resources and actions in relation to an external environment in order to achieve its goals and objectives. This is conducted in a very hierarchical and formal manner.
According to Mintzberg and Waters (1985), some strategies may be planned, at least in their first stages, but many more just simply emerge in an organization without being consciously intended or being deliberate acts
Logical incrementalism (Quinn, 1980) combines rational-resource allocation thinking with practical learning by doing; longer-term plans and targets with evolutionary, learning-based patterns of movement on the way
All of the above statements are true
When applying Porter’s 5 forces model for a given firm, which of the forces would be most directly influenced if that firm is threatened to engage in vertical integration?
Buyer power
Pressure from substitutes
Threat of new entrants
Intensity of rivalry
Which statement is true according to the Chesbrough & Rosenbloom?
Only statement I is true
Only statement II is true
Both statements are true
Both statements are false
Which organization type, designed by Michaud and Thoenig, is characterized by its calm external contexts, bureaucratic character, short-term perspective and individuals within who have no incentive to change?
Mercenary organization
Fragmented organization
Organic organization
Self-sufficient organization
The principal-agent model in which principals are the shareholders and the agents are corporate managers:
Assumes that the goals of the principal and the goals of the agent will conflict
Assumes that the sole purpose of the firm is to maximize shareholder value.
Assumes that social relations in economic interaction can be reduces to sets of contracts between principals and agents
All of the above are true
Regarding the inimitability of resources, path dependency refers to:
Not really knowing what (combinations of) assets are responsible for the existing success
Cumulative learning and experience over time, which is difficult to replicate over short periods.
The socially complex system that gives rise to the competitive advantage
All of the above
What perspective is included in the strategy map developed by Kaplan and Norton (2001)?
Social-cultural perspective
Political perspective
Customer perspective
Ecological perspective
BMW forcing an alliance with Rolls Royce in aircraft engines in order to enter a new market is an example of:
Cross-industry agreement
Vertical partnership
Complementary alliance
Pre-competitive alliance
Which of the following is true according to prospect theory?
The 50% chance of losing $40,000 is preferred over the guaranteed loss of $20,000
The disappointment at losing $20,000 is greater than the pleasure of gaining the same amount
The guaranteed gain of $20,000 is preferred over the 50% chance of gaining $40,000
All of the above
Which of the following is a support activity in Porter’s value chain model:
Inbound logistics
Human resource management
Operations
Service
According to the lecture covering network-level strategy, a strategic network can be described as:
A cross between a clan and a hierarchy
A hierarchy with a non-zero-sum game
A market with a non-zero-sum game
A market with a zero-sum game
Which term addresses what strategic decisions are about and what the intention is?
Strategic context
Strategic content
Strategic product
Strategic process
According to the lecture on Mintzberg’s view on decision-making, which approach is most appropriate when many elements have to be combined into creative solutions, commitment on those solutions is key, and communication across boundaries is essential?
Doing first
Being first
Seeing first
Thinking first
According to the lecture on corporate strategy, which integration mechanism is based on all the SBUs having similar resources, activities and product features?
Centralization
Coordination
Standardization
Concentration
1 d | 11 a | 21 d | 31 d |
2 b | 12 b | 22 b | 32 b |
3 b | 13 d | 23 a | 33 c |
4 c | 14 a | 24 c | 34 a |
5 a | 15 d | 25 b | 35 d |
6 c | 16 d | 26 a | 36 b |
7 c | 17 b | 27 d | 37 c |
8 d | 18 c | 28 a | 38 b |
9 a | 19 a | 29 b | 39 c |
10 d | 20 d | 30 b | 40 c |
According to Mintzberg (2.4 Decision-making: It's not what you think), which decision-making approach is associated with organizational behavior, Karl Weick, and the following process: enactment => selection => retention ?
Which approach claims that powerful people with the firm prevent learning in order to maintain their own power base?
In the context of efficient production and plant size, indivisibility means that:
In Prospect theory, the relationship between outcomes and the value of those outcomes is drawn as:
In the Turnbell report, which type of risk is associated with the following issues: loss of key people, succession problems and reputation damage?
Which of Porter’s generic strategies is associated with a narrow market scope and commodity products?
Which of the following is not true about strategic groups?
According to Mintzberg (Decision-making: It's not what you think), which decision-making approach is most appropriate when many elements have to be combined into creative solutions, commitment on those solutions is key, and communication across boundaries is essential?
Which of the following is the most effective way to transfer tacit knowledge to new workers?
Which organizational structure enables business managers to maximize economies of specialization, by allowing them to focus on their products and markets, while freeing corporate managers from the distractions of day-to-day operations?.....read more
Which characteristics describe monopolistic or imperfect competition?
Some to vary few firms, high differentiation of products
Some to vary few firms, low differentiation of products
Many firms, no differentiation of products
Many firms, some differentiation of products
According to the lectures, which of the following best describes the relationship between Porter’s Five Forces analysis and the PEST analysis?
A PEST analysis focuses on process issues while a Five Forces analysis focuses on content issues.
A Five Forces analysis describes the industry (i.e., the micro-economic environment) that the firm is in, while a PEST describes the broader (macro-economic) environment that the industry is in
A Five Forces analysis describes the external environment, while PEST analysis describes the internal environment of the firm
The findings from a Five Forces analysis provide the input (the data) for a PEST analysis
According to the lecture on organizational learning, which term refers to key individuals or interest groups using their power to prevent change and maintain the status quo?
Co-evolutionism
Institutionalism
Neo-institutionalism
Isomorphism
What strategic options in decision-making are available to organizations that have a low knowledge of new markets, but have high capabilities?
No options
Trade options
Bounded options
Full set of options
Imagine an SBU within a corporate portfolio that has the second largest market share in a mature market. According to the lecture on the BCG-matrix, this SBU would be a:
Dog
Questionmark
Cash cow
Star
Henderson and Clark (1990) review two kinds of dynamic processes in modular systems: modular innovation and architectural innovation. Which statement(s) is (are) true?
I Modular innovation retains the architecture of the network, including its joints, but modifies the modules. The changes occur in innovations and improvements of the modular components.
II In architectural innovation, the modules are largely unchanged, but the architecture that connects them (the jointing system) is changed. The speed of innovation can be fast, as a key part of the system, the modular structure, is retained. New joints between these modules are installed.
Only statement I is true
Only statement II is true
Both statements are true
Both statements are false
Which statement(s) is (are) true with regard to decision-making?
I Planning facilitates decision makers in analyzing and codifying what appear initially as complex problems. Planning processes help decision makers identify key performance indicators by which progress of the decision can be monitored and judged.
Michael Porter argued that when analyzing opportunities and threats, managers should pay particular attention to five forces that are the major threats that an organization will encounter. Which of the following forces would be affected by your customers' loyalty to your products?
The level of rivalry among organizations in an industry
The potential for entry into an industry
The power of suppliers
Substitute products
Which of the following best describes the concept of the learning curve?
Time-to-market decreases as a function of the number of innovations developed.
Technical performance increases in an S-shaped curve as a function of effort.
The ability to learn is normally distributed across firms (i.e., a bell-shaped curve).
Cost per unit drops as a function of the cumulative output (total number of units produced).
The competition among firms in the same strategic group will be ________ between firms belonging to different strategic groups even if they sell similar products or services.
similar in intensity to that
more intense than that
less intense than that
variable in intensity than that
An independent group of suppliers, such as farmers, gather to form a cooperative in order to sell their products to buyers directly, replacing their previous distributor. This is an example of
forward integration.
backward integration.
threat of substitute products.
threat of entry.
Which of Porter’s generic strategies is associated with a narrow market scope and commodity products?
Cost focus
Differentiation focus
Cost differentiation
Differentiation
Which of the following is true regarding a differentiation strategy?
A firm selects a unique position on one or more attributes (dimensions) that are important to buyers in general.
A corporation is split into a number of different strategic business units (SBUs).
A single firm develops a broad portfolio of products targeting a number of different markets.
A firm identifies the needs of a specific group of buyers and tailors its strategy to serve that group to the exclusion of other groups.
The term 'stuck in the middle':
means that the firm's cost structure is not low enough to allow it to attractively price its products and that its products are not sufficiently differentiated to create value for its target customer.
indicates that the customers of the firm are willing to pay only a mid-range price for the product.
means adhering to a middle of the road strategy in
Which one of Porter’s 5 forces would be most directly affected if an existing firm in that niche threatens to engage
in vertical integration?
Regarding the statement “patents protect innovation better than any other mechanism":
In the material from Lecture 1, Rumelt gives four criteria for evaluating a strategy. Which criterion has to do with
making sure that the strategy does not overwhelm the available resources?
The key insight from the “prisoners’ dilemma” game is:
According to the lecture, in Barney’s approach to the resource-based view, entry barriers can only provide a
sustainable competitive advantage under which condition(s)?
A well-known brand can provide a sustainable competitive advantage because:
Which of the following factors is NOT conducive to vertical integration [p.303] between two adjacent stages of
production?
If an industry earns a return on capital in excess of its cost of capital:
The main factor causing the transition from corporate planning to strategic management was the work of Michael Porter and fellow academics at Harvard Business School.
An intended strategy is a set of initial ethical intentions; an emergent strategy comprises actions or changes that emerge from the organization or its environment; and finally, the realized strategy is the set of strategic changes and actions that actually takes place.
If a firm adjusts its strategy to ensure it is consistent with its external environment, it benefits from a:
To survive and prosper over the long run requires a firm to:
The primary justification for the assumption that the primary goal of strategy is to maximize profits over the long term is:
Maximizing enterprise value and maximizing shareholder value are linked because:
In formulating strategies under uncertainty, real option analysis is a valuable strategic tool because:
The level of profit in an industry is determined almost entirely by the value of products to customers.
Niche markets are often highly profitable for incumbents because they can often be dominated by a single firm.
Economies of scale, absolute cost advantages, high.....read more
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