Question 1

A group of companies offering products or services that are close substitutes for each other is referred to as a(n)

Accepted Answer

A)   strategic group.
B)   market segment.
C)   sector.
D)   supplier.
E)   industry.F) A) and D)
G) B) and C)

Question 2

Growth in an embryonic industry is slow because of buyers' unfamiliarity with the industry's product, high prices due to the inability of companies to reap any significant scale of economies, and poorly developed distribution channels.

Accepted Answer

A) True 
 B)False

Question 3

The growth industry is where demand is expanding as second-time consumers enter the market.

Accepted Answer

A) True 
 B)False

Question 4

Strategic groups are groups of companies in which each company follows a strategy that is similar to that pursued by other companies in the group, and is the same strategy followed by companies in other groups.

Accepted Answer

A) True 
 B)False

Question 5

A company's closest competitors are those that

Accepted Answer

A)   are in the same geographical area.
B)   serve the same basic customer needs.
C)   are small and aggressive.
D)   focus on low price.
E)   attack and then retreat before the company can respond.F) All of the above
G) B) and D)

Question 6

Demand reaches total saturation in the ___________ stage of the industry life cycle.

Accepted Answer

A)   embryonic
B)   growth
C)   shakeout
D)   maturity
E)   declineF) B) and D)
G) C) and D)

Question 7

Which of the following industry structures consists of a large number of small and medium-sized companies, none of which is in a position to determine industry price?

Accepted Answer

A)   Fragmented industry
B)   Consolidated industry
C)   Oligopoly
D)   Monopoly
E)   SectorF) A) and B)
G) A) and C)

Question 8

Which of the following industry structures is dominated by a small number of large companies?

Accepted Answer

A)   Fragmented industry
B)   Consolidated industry
C)   Mature industry
D)   Monopoly
E)   Growing industryF) None of the above
G) A) and B)

Question 9

Managers must anticipate how the strength of industry competitive forces will change as the industry evolves and then formulate appropriate strategies to take advantage of opportunities.

Accepted Answer

A) True 
 B)False

Question 10

Julian is asked to examine the demographic environment facing his employer, a clothing manufacturer. Which of the following should Julian examine?

Accepted Answer

A)   Government regulations
B)   Inflation
C)   Manufacturing technology
D)   Aging of the population
E)   Society's growing interest in exerciseF) B) and E)
G) C) and E)

Question 11

The industry life cycle model identifies four sequential stages in the evolution of an industry that lead to four distinct kinds of industry environment.

Accepted Answer

A) True 
 B)False  False

Question 12

Members of a strategic group

Accepted Answer

A)   compete directly with members of other strategic groups.
B)   are affected by Porter's five competitive forces to the same degree that members of other strategic groups are affected.
C)   follow a business model that is similar to that pursued by other companies in the group.
D)   earn the same rate of return.
E)   move easily to other groups as desired.F) A) and C)
G) A) and B)

Question 13

Exit barriers are the economic, strategic, and emotional factors that prevent companies from leaving an industry.

Accepted Answer

A) True 
 B)False

Question 14

Mobility barriers

Accepted Answer

A)   prevent movement within a strategic group.
B)   inhibit the movement of companies between strategic groups in an industry.
C)   inhibit the movement of a company from one industry to another.
D)   include exit barriers of the strategic group that a company wants to enter.
E)   are low when exit barriers in the strategic group that a company is a member of are high.F) B) and D)
G) A) and B)

Question 15

Potential competitors are companies that are currently competing in an industry, but have the capability to do so if they choose.

Accepted Answer

A) True 
 B)False

Question 16

The bargaining power of an industry's suppliers is greater when

Accepted Answer

A)   the supply industry is fragmented.
B)   switching costs are high.
C)   the industry buys in large quantities.
D)   many substitutes are available.
E)   firms in the industry can threaten backward vertical integration.F) A) and B)
G) A) and E) B

Question 17

Merck, Eli Lilly, and Pfizer are examples of?

Accepted Answer

A)   a generic drug strategic group.
B)   companies which manufacture low-cost drugs.
C)   companies with low R&D spending
D)   a proprietary strategic group pursuing a high-risk, high-return strategy.
E)   unsuccessful patent monopolies.F) A) and B)
G) All of the above

Question 18

High levels of immigration into the U.S. in recent years have had an impact on which of the following macroenvironmental factors?

Accepted Answer

A)   Economic
B)   Social
C)   Political and legal
D)   Demographic
E)   All of the macroenvironmental factors have been affected.F) A) and D)
G) A) and E)

Question 19

The concept of strategic groups suggests that

Accepted Answer

A)   a company's major competitors are those in other groups.
B)   companies within a strategic group all have the same rate of return.
C)   it is easier for a company to move between groups than within a group.
D)   different strategic groups can have different standings with respect to each of Porter's five competitive forces.
E)   each company in the group pursues a unique basic strategy.F) None of the above
G) A) and E)

Question 20

In a declining industry, competition usually decreases.

Accepted Answer

A) True 
 B)False  False

Exam 3: External Analysis: the Identification of Opportunities and Threats

A group of companies offering products or services that are close substitutes for each other is referred to as a(n)

Correct AnswerverifiedShow Answer

Growth in an embryonic industry is slow because of buyers' unfamiliarity with the industry's product, high prices due to the inability of companies to reap any significant scale of economies, and poorly developed distribution channels.

Correct AnswerverifiedShow Answer

The growth industry is where demand is expanding as second-time consumers enter the market.

Correct AnswerverifiedShow Answer

Strategic groups are groups of companies in which each company follows a strategy that is similar to that pursued by other companies in the group, and is the same strategy followed by companies in other groups.

Correct AnswerverifiedShow Answer

A company's closest competitors are those that

Correct AnswerverifiedShow Answer

Demand reaches total saturation in the ___________ stage of the industry life cycle.

Correct AnswerverifiedShow Answer

Which of the following industry structures consists of a large number of small and medium-sized companies, none of which is in a position to determine industry price?

Correct AnswerverifiedShow Answer

Which of the following industry structures is dominated by a small number of large companies?

Correct AnswerverifiedShow Answer

Managers must anticipate how the strength of industry competitive forces will change as the industry evolves and then formulate appropriate strategies to take advantage of opportunities.

Correct AnswerverifiedShow Answer

Julian is asked to examine the demographic environment facing his employer, a clothing manufacturer. Which of the following should Julian examine?

Correct AnswerverifiedShow Answer

The industry life cycle model identifies four sequential stages in the evolution of an industry that lead to four distinct kinds of industry environment.

Correct AnswerverifiedFalse

Members of a strategic group

Correct AnswerverifiedShow Answer

Exit barriers are the economic, strategic, and emotional factors that prevent companies from leaving an industry.

Correct AnswerverifiedShow Answer

Mobility barriers

Correct AnswerverifiedShow Answer

Potential competitors are companies that are currently competing in an industry, but have the capability to do so if they choose.

Correct AnswerverifiedShow Answer

The bargaining power of an industry's suppliers is greater when

Correct AnswerverifiedB

Merck, Eli Lilly, and Pfizer are examples of?

Correct AnswerverifiedShow Answer

High levels of immigration into the U.S. in recent years have had an impact on which of the following macroenvironmental factors?

Correct AnswerverifiedShow Answer

The concept of strategic groups suggests that

Correct AnswerverifiedShow Answer

In a declining industry, competition usually decreases.

Correct AnswerverifiedFalse

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False

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B

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False