S. Management CPT 5
A. maximizing risk-return tradeoffs through diversification.
B. achieving a low cost position.
C. maximizing differentiation of products and/or services.
D. achieving competitive advantage(s).
B. overall cost leadership
C. differentiation focus
A. focus on a narrow market segment.
B. rely on experience effects to raise efficiency.
C. use advertising to build brand image.
D. put heavy emphasis on product engineering.
A. hiring more experienced personnel.
B. repeating a process until a task becomes easier.
C. spreading out a given expense or investment over a greater volume.
D. competing in an industry for a long time.
A. if it can induce greater demand and thereby help a firm travel down the experience curve faster.
B. in industries characterized by high economies of scale.
C. in the maturity stage of the industry life cycle.
D. in the decline stage of the industry life cycle.
A. Overall cost leadership.
C. Differentiation focus.
D. Cost leadership focus.
A. Cost cutting may lead to the loss of desirable features.
B. Attempts to stay ahead of the competition may lead to gold plating.
C. Cost differences increase as the market matures.
D. Producers are more able to withstand increases in suppliers’ cost.
A. improving brand image.
B. better customer service.
C. offering lower prices to frequent customers.
D. adding additional product features.
B. Overall cost leadership.
C. Differentiation focus.
D. Stuck-in-the middle.
A. higher market share.
B. decreased emphasis on competition based on price.
C. higher profit margins and lower costs.
D. significant economies of scale.
A. By increasing a firm’s margins, it avoids the need for a low cost position.
B. It helps a firm to deal with supplier power and reduces buyer power since buyers lack comparable alternatives.
C. Supplier power is increased because suppliers will be able to charge higher prices for their inputs.
D. Firms will enjoy high customer loyalty, thus experiencing less threat from substitutes than its competitors.
A. lessening competitive rivalry by distinguishing itself.
B. having brand-loyal customers become more sensitive to prices.
C. increasing economies of scale.
D. serving a broader market segment.
A. uniqueness that is not valuable.
B. too high a price premium.
C. all rivals share a common input or raw material.
D. perceptions of differentiation may vary between buyers and sellers.
A. If several competitors pursue similar differentiation tactics, they may all be perceived as equals in the mind of the consumer.
B. With an overall cost leadership strategy, firms need not be concerned with parity on differentiation.
C. In the long run, a business with one or more competitive advantages is probably destined to earn normal profits.
D. Attaining multiple types of competitive advantage is a recipe for failure.
A. broadly-defined target market is to a cost leadership strategy.
B. growth market is to a differentiation-based strategy.
C. growth market is to a cost-based strategy.
D. technological innovation is to a cost-based strategy.
A. must focus on governmental regulations.
B. must focus on a market segment or group of segments.
C. must focus on the rising cost of inputs.
D. must avoid entering international markets.
A. erosion of cost advantages within the narrow segment.
B. all rivals share a common input or raw material.
C. even product and service offerings that are highly focused are subject to competition from new entrants and from imitation.
D. focusers can become too focused to satisfy buyer needs.
A. at about the same level as firms that achieve either cost or differentiation advantages.
B. about the same as firms that are “stuck-in-the-middle.”
C. lower than firms that achieve differentiation advantages but higher than firms that achieve cost advantages.
D. higher than firms that achieve either a cost or a differentiation advantage.
A. automated and flexible manufacturing systems.
B. exploiting the profit pool concept for competitive advantage.
C. coordinating the “extended” value chain by way of information technology.
D. deriving benefits from highly focused and high technology markets.
A. profit maximizer
B. revenue enhancer
C. profit pool
D. profit outsourcing
A. firms that fail to attain both strategies may end up with neither and become “stuck-in-the-middle.”
B. targeting too large a market that causes unit costs to increase.
C. underestimating the challenges and expenses associated with coordinating value-creating activities in the extended value chain.
D. miscalculating sources of revenue and profit pools in the firm’s industry.
A. eliminating supply chain intermediaries
B. evaluating employee performance
C. minimizing office expenses
D. reducing business travel
A. electronic data interchange.
B. knowledge management.
C. collaborative design.
D. mass customization.
A. celebrity endorsements
B. prestige packaging
C. exceptional service
D. mass customization
A. respond quickly to customer requests.
B. provide more services and features.
C. access markets less expensively.
D. access niche markets in a highly specialized fashion.
A. incumbent firms are entering market segments that they previously considered to be too small.
B. nearly all competitors will have greater access to tools for managing costs making it hard for any one to achieve an advantage.
C. differentiators have been able to preserve the unique advantages that have always been the hallmark of their success.
D. firms are ignoring opportunities to offer high-end services in niche markets.
A. Part of the power of the market life cycle is its ability to serve as a short-run forecasting device.
B. Trends suggested by the market life cycle model are generally not reversible or repeatable.
C. It has important implications for a firm’s generic strategies, functional areas, value-creating activities, and overall objectives.
D. It points out the need to maintain a differentiation advantage and a low cost advantage simultaneously.
A. It produces relatively large, positive cash flows.
B. Strong brand recognition seldom serves as an important switching cost.
C. Market share gains by pioneers are usually easily sustained for many years.
D. Products or services offered by pioneers may be perceived as differentiated simply because they are new.
A. “in-kind” competition (from the same type of product).
B. premium pricing.
C. a growing trend to compete on the basis of price.
D. retaliation by competitors whose customers are stolen.
A. costs continue to increase.
B. application for patents increase.
C. differentiation opportunities increase.
D. there is increasing emphasis on efficiency.
A. Some competitors enjoy a significant operating advantage due to increasing experience effects.
B. The market supports premium pricing, which attracts additional competitors.
C. Advantages that cannot be duplicated by other competitors are difficult to achieve.
D. The magnitude of pricing differences and product differentiation is larger than in the growth stage.
A. high growth.
B. strong competitive advantage.
C. mergers and acquisitions.
D. decline in the market life cycle.
A. asset and cost surgery.
B. selective product and market pruning.
C. global expansion.
D. piecemeal productivity improvements.
A. business process reengineering.
B. increased capacity utilization.
D. expansion of a firm’s product market scope.
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