Strategic Management and Strategic Competitiveness Question Paper

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Chapter 1—Strategic Management and Strategic Competitiveness

TRUE/FALSE

1.The Opening Case shows that McDonald’s is one of the few firms able to achieve strategic competitiveness from its founding until the present time.

ANS:FPTS:1DIF:MediumREF:3
OBJ:01-01 TYPE: application
NOT:AACSB: Multicultural & Diversity | Management: Environmental Influence | Dierdorff & Rubin: Managing strategy and innovation

2.By focusing on product innovations and upgrades of its properties, McDonald’s was able to achieve strategic competitiveness and above average returns.

ANS:TPTS:1DIF:MediumREF:3-4
OBJ:01-01 TYPE: application
NOT:AACSB: Business Knowledge and Analytical Skills | Management: Strategy| Dierdorff & Rubin: Managing strategy and innovation

3.Strategic competitiveness is achieved when a firm successfully formulates and implements a value-creating strategy.

ANS:TPTS:1DIF:EasyREF:4
OBJ:01-01 TYPE: knowledge
NOT:AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Rubin: Managing strategy & innovation

4.Part of McDonald’s strategy was the choice that it would remain involved in additional food concepts such as Boston Market and Chipotle.

ANS:TPTS:1DIF:EasyREF:4
OBJ:01-01 TYPE: application
NOT:AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Rubin: Managing strategy & innovation

5.Alligator Enterprises has earned above-average returns since its founding five years ago. Since no other firm has challenged Alligator in its particular market niche, the firm’s owners can feel secure that Alligator has established a competitive advantage.

ANS:FPTS:1DIF:HardREF:5
OBJ:01-01 TYPE: application
NOT:AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Rubin: Managing the task environment

6.The goal of strategic management is to develop a competitive advantage that is permanent.

ANS:FPTS:1DIF:MediumREF:5
OBJ:01-01 TYPE: comprehension
NOT:AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Rubin: Managing strategy & innovation

7.Risk in terms of financial returns reflects an investor’s uncertainty about economic gains or losses that will result from a particular investment.

ANS:TPTS:1DIF:EasyREF:5
OBJ:01-01 TYPE: knowledge
NOT:AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Rubin: Foundational skills

8.Average returns are returns in excess of what an investor expects to earn from other investments with a similar amount of risk.

ANS:FPTS:1DIF:MediumREF:5
OBJ:01-01 TYPE: knowledge
NOT:AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Rubin: Foundational skills

9.Returns can only be measured in accounting terms such as return on assets, return on equity, or return on sales.

ANS:FPTS:1DIF:EasyREF:5
OBJ:01-01 TYPE: knowledge
NOT:AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Rubin: Foundational skills

10.Best Buy outperforming Circuit City, and Best Buy’s continuing good performance illustrate that permanent success is possible.

ANS:FPTS:1DIF:MediumREF:6
OBJ:01-01 TYPE: application
NOT:AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Rubin: Managing strategy & innovation

11.In the chapter Strategic Focus case, Circuit City did not achieve strategic competitiveness and above-average returns because it failed to successfully implement its strategy.

ANS:TPTS:1DIF:EasyREF:8
OBJ:01-01 TYPE: application
NOT:AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Rubin: Managing strategy & innovation

12.Economies of scale and huge advertising budgets are just as effective in the new competitive landscape as they were in the past, but they must be...
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