Question

1. Which of the following best explains why zoos are not affected by the threats of new entrants?
- Starting a zoo has a high entry cost.
- Customers do not have replacement activities.
- Substitutions for attending the zoo are much lower quality.
- The zoo industry is growing rapidly.

2. A _______________ is a network of value-creating activities.
- value pyramid
- value chain
- value network
- value system

3. Which of the following is not a potential disadvantage of a low-cost strategy?
- Consumer tastes can change over time.
- Firms with a focus strategy can potentially have prices just as low.
- Other firms can neutralize the advantage by cutting prices to the same level.
- Firms with access to better technology can obtain even lower prices.

4. Paul wants to start a landscaping business. An example of a differentiation strategy he might try is
- advertising nationwide in a variety of gardening magazines.
- using only trees and grasses that are naturally pest resistant.
- offering discounts to repeat customers.
- selling at prices comparable to large home-improvement garden centers.

5. After creating an organizational strategy based on Porter's models, a company can
- develop information systems.
- create process models.
- calculate inputs and outputs.
- examine market structure.

6. By choosing a(n) __________, an organization responds to the structure of its industry.
- brand image
- competitive strategy
- advertising policy
- business process

7. The owner of Harriet's Hair Studio is hoping to increase customer loyalty by offering free hair trims in between hair-coloring appointments. Which of the five forces in Porter's model is Harriet addressing?
- the threat of new entrants
- the bargaining power of supplies
- the bargaining power of customers
- rivalry

8. Which of the following does not affect a company's organizational strategy?
- Porter's generic strategies model
- Porter's value chain model
- Porter's competitive institutions model
- Porter's five forces model

9. Which of he following situations represents a strong bargaining power of suppliers?
- a winter coat outlet at the beginning of spring
- strawberry growers following an unexpected frost
- jewelry store liquidation following a decision to close the business
- apartment prices in a saturated rental market

10. Which of the following represents inbound logistics for a bookstore?
- allowing customers to fill out a satisfaction survey
- featuring a book signing by a popular author
- purchasing books from a publishing house
- recruiting and retaining high-quality employees

Answer 1

1. Starting a zoo has a high entry cost.

2. Value chain.

3. Other firm can neutralize the advantage by cutting prices to the same level.

4. Using only trees and grasses that are naturally pest resistant.

5. Calculate inputs and outputs.

6. Competitive strategy.

7. Rivalry.

8. Porter's five forces model.

9. Strawberry growers following an unexpected frost.

10. Purchasing books from a publishing house.