Unit 2 Quizzes PDF

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Unit 2 Quizzes Chapter 5 1. Sandra is developing a competitor analysis for two florists. Which of the following information in the analysis will be the bases for predicting the competitors’ behavior in the form of their competitive actions and responses? a. Market commonality 2. Which of the following is NOT a reason for a firm to respond to a competitor’s action? a. The firms have resource dissimilarity 3. Which of the following is an example of multimarket competition? a. Company A makes tomato sauce sold to consumers in grocery stores and to restaurants. Company B sells tomato sauce to consumers in grocery stores 4. By introducing Google Pay in response to Apple Pay, Google hopes to build and defend its competitive advantages and improve its market position through: a. Competitive behavior 5. Car maker BAAS is known for its risky competitive behavior, including drastically changing its prices over short time spans. Based on this information, which of the following is the most likely competitor response? a. Competitors will be less likely to respond because of BAAS’ risky behavior 6. FedEx and United Parcel Service (UPS) compete in many of the same markets and have similar types of truck and airplane fleets, similar levels of financial capital, and other similarities. These tangible and intangible resources between the two firms describe the: a. Resource similarity 7. Which of the following relates to a firm’s resources and the flexibility they provide? a. Ability 8. FreeForAll is an online retailer for graphic t-shirts and hats. Previously, it was the only mass retailer for such goods. Hatz, an in-store retailer that sells predominantly baseball hats, has just launched an e-commerce site that also features t-shirts for sales. FreeForAll has decided to respond quickly to Hatz’s competitive action. This decision is based on FreeForAll’s: a. Market dependence 9. Fast-cycle markets are markets in which the firms’ capabilities that contribute to competitive advantages aren’t shielded from imitation and where imitation is often ___ and ____. a. Rapid; inexpensive 10. The number of markets with which a firm and a competitor are jointly involved and the degree of importance of the individual markets to each is referred to as: a. Market commonality 11. Which of the following is an advantage of being part of a slow-cycle market as opposed to a fast-cycle market? a. In slow-cycle markets, firms can shield themselves from imitation 12. Which of the following characteristics best describe tactical actions? a. Relatively easy to implement and reverse 13. Slow-cycle markets are markets in which the firm’s:

a. Competitive advantages are shielded from imitation, commonly for long periods of time, and where imitation is costly 14. Which of the following may result if Bella’s Eatery does not conduct a competitor analysis? a. Formation of competitive blind spots 15. A fast-food chain, Bob’s Bigger Burgers, has just launched a campaign to market its new pound-and-a-half burger against its competitor, Lou’s Burgers, who previously sold the biggest burger at a pound a quarter. Bob’s Bigger Burgers’ strategic move against Lou’s Burgers is a: a. Competitive action Chapter 6 1. Intangible resources are more flexible than tangible physical assets in facilitating a. Diversification 2. A company is looking to diversify as a way to reduce risk and protect against uncertain future cash flow from its core business. These efforts would most likely have which of the following impacts on the firm’s value? a. It would be value-neutral 3. A firm owns several businesses, including a personal loan office and a furniture store. Another standalone personal loan office is suffering financially because of the allocation of its assets. The furniture business decides to buy the standalone personal loan business, restructure its assets, and then sell it as operations resume more successfully. This is an example of: a. Unrelated diversification 4. A single-business diversification strategy and a dominant-business diversification strategy are both examples of what level of diversification? a. Low level 5. A secondhand computer retailer is often mistaken for an IT-help business. As a result, tech-savvy employees of the retailer are often fixing the customer’s computer issues when they come into the store. The firm that owns the secondhand computer retailer has decided to diversify and open computer repair shops selling IT services. The retailer is diversifying on the basis of employee knowledge, which is considered a ___ resource a. Intangible 6. In which of the following ways does the availability of tangible and intangible resources affect a firm’s ability to create value through diversification? a. A resource has rarity and value 7. A popular TV network, QTV, wishes to gain a competitive advantage by managing several businesses from its corporate headquarters. Among its goals, QTV hopes to acquire its competitor, RTV, in the process. In this instance, QTV is using which type of strategy? a. Corporate-level strategy 8. What is the distinction between value-neutral reasons and value-creating reasons for a firm to diversify? a. Value-neutral reasons seek to help the firm establish a more competitive position, whereas value-creating reasons seek to improve the firm overall.

9. Which of the following represents an example of an external incentive for value-neutral diversification? a. An organization forced to pursue a new business unit because of changes in tax laws and regulations 10.What are economies of scope? a. Cost savings a firm creates by successfully sharing resources and capabilities or transferring one or more corporate-level core competencies that were developed in one of its businesses to another of its businesses. 11.Which of the following is a reason why firms with a low level of diversification are often able to earn positive returns? a. They can provide superior customer service 12.Steeler Manufacturing uses an unrelated diversification strategy throughout its operations. For instance, Steeler has five core businesses, all of which are unrelated. Each of its businesses is large and indicates Steeler's success in implementing an unrelated diversification as a _____ firm. a. Very highly diversified 13.Firms use corporate-level strategies for several reasons, including to: a. Pursue development of a market 14.Sports Inc. has developed a shoe to compete with Air Jordans. In order to keep up with competitors and minimize competitor market power, the firm decides to sell branded sports equipment as well. By introducing another new business so soon outside of its shoe products, the firm stands to lose value. Sports Inc.'s reason for diversifying itself is to _____ by acquiring a _____. a. Neutralize another firm’s advantage; similar distribution outlet 15.Which of the following is an advantage of pursuing diversification by entering into a greenfield venture? a. By taking advantage of intangible resources, such as experience and knowledge of a firm, a new business can be established independently with instant ability to create value using those resources Chapter 7 1. Which of the following is an attribute of a successful acquisition? a. Acquiring firm has financial slack 2. A firm owns a wide variety of consumer goods businesses. Its portfolio includes a grocery store, shoe store, and gas station. How might the diversification of its businesses impact its ability to have successful acquisitions? a. Managers are unequipped to evaluate the success of businesses on a deeper level than finances 3. When a target firm does not solicit an acquiring firm’s bid, it is known as: a. Takeover 4. The long-term outcomes of a leveraged buyout are higher performance and higher risk. What two short-term outcomes lead to these long-term outcomes a. Emphasis on strategic controls and high debt costs

5. Which of the following is the result of a merged firm that maintains a low to moderate debt position? a. Lower financing cost 6. When a firm takes over another firm in an unfriendly acquisition process, what is a challenge to its future success? a. The firm will struggle to effectively integrate its operations 7. Two specialty craft stores have just been bought by craft giant Ultimate Crafts. By rebranding the small stores, Ultimate Crafts' executives hope to gain strategic competitiveness in what way? a. Market power 8. Which of the following is an example of a problem that can prevent an acquisition from being successful? a. Too much diversification 9. ___ generally, leads to more positive outcomes in both the short and long term a. Down-scoping 10.A popular juniors clothing store features young designers and has been very successful. To gain strategic competitiveness, the clothing store frequently acquires young socialmedia sensations' designs and brings their designs to life in the store. What type of acquisition is the store using to increase its strategic competitiveness? a. Related acquisition 11.A large software company is in the process of acquiring a small tech startup that has built an app for developers to code websites on their smartphones. It is rumored that the software company has grossly overestimated the future growth as a result of the acquisition. If this turns out to be true, what common acquisition problem has the software company encountered? a. Inadequate evaluation of target 12. Which of the following statements best explains how shareholders affected by acquisitions? a. Acquired firms' shareholders often earn above-average returns as a result of acquisitions, whereas acquiring firms' shareholders often earn returns that are close to zero as a result of acquisitions 13.Disney bought Pixar in 2004 to extend and begin a new partnership in its renewed focus on animation. In the deal, Steve Jobs, the CEO of Pixar at the time, vowed to preserve the independent nature of Pixar. Since then, the two have put out hits such as the Toy Story, The Incredibles, and Nemo franchises. This partnership is an example of a(n): a. Merger 14.Ronson Foods, a corporation that operates more than 400 large supermarkets in 12 states in the northeastern United States, is considering acquiring East Coast Organics, a small chain of 26 specialty food stores known for their friendly atmosphere and humorous advertising. While many see the potential in this acquisition, some analysts worry about the integration process following the acquisition. What is a difference between the two that might cause difficult integration? a. There may be cultural differences in operations between the two firms 15. What does it mean when an acquisition is unable to achieve synergy?

a. When the acquiring firm and acquired firm do not effectively share resources, economies of scale, and economies of scope across the businesses...