TEST BANK FOR
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STRATEGIC MANAGEMENT 6TH EDITION ROTHAER
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MEL FRANK e0
ISBN 978-1266191862
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,Chapter 1-12 Answers are at the End of Each Chapter
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Chapter 1 e0
Student name: e0
1) A good strategy allows a firm to achieve superior performance and sustainable competitiv
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e advantage without regard to the external environment.
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⊚ true e 0
⊚ false e 0
2) The following statement by the chief executive of MegaFilms movie studio should not b
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e used as a strategy: “We will produce the greatest films of the 21st century.”
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
⊚ true e 0
⊚ false e 0
3) The three tasks of the AFI strategy framework are to Assemble a prototype, Find a buyer, a
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nd Incorporate feedback.
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⊚ true e 0
⊚ false e 0
4) Questions asked during the strategy analysis stage of the AFI framework should include
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“What effects do forces in the external environment have on the firm’s potential to gain an
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d sustain a competitive advantage?”
e0 e0 e0 e0
⊚ true e 0
⊚ false e 0
,5) Once a strategy has been formulated and implemented, it is important that the firm sticks to
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it no matter what happens.
e0 e0 e0 e0
⊚ true e 0
⊚ false e 0
6) Because they are a crucial component of a firm’s success, customers are considered intern
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al stakeholders.
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⊚ true e 0
⊚ false e 0
7) A firm is required by society and its shareholders to meet its ethical and philanthropi
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
c responsibilities.
e0
⊚ true e 0
⊚ false e 0
8) Stakeholder impact analysis provides a decision tool that helps strategic leaders recognize th
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
e needs of different stakeholders.
e0 e0 e0 e0
⊚ true e 0
⊚ false e 0
9) Juan wants to open his own hot dog restaurant but doesn’t know anything about business.
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He needs help determining who his competition is, how he should craft his strategy to co
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
mpete and how he’ll implement his strategy to achieve a competitive advantage. He’s hire
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d you to help him get started. As a result, you will probably use which of the following?
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
A) AFI strategy framework e0 e0
B) Red Queen effect e0 e0
C) competitive benchmarking e0
D) Stakeholder Impact analysis e0 e0
, 10) Roberta is interested in the concept of strategy and decides to create her own. As a resul
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t, Roberta says that her strategy is to focus on competitive benchmarking to achieve c
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ompetitive advantage. Which is the best evaluation of Roberta’s statement?
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A) Roberta’s strategy is clear, but she should provide more detail. e0 e0 e0 e0 e0 e0 e0 e0 e0
B) Roberta’s strategy reveals a clear strategic position and tradeoff, so she shoul
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
d proceed. e0
C) Roberta should reevaluate her statement because it fails to mention more than on
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e strategy. e0
D) Roberta should reevaluate her statement because it fails to meet the principles of wh
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at a strategy should be. e0 e0 e0 e0
11) Tony’s Pizza Shop is able to net $10,000 a week; this makes the shop profitable. Its numb
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er one competitor, Leo’s Pies, is also profitable, netting $12,000 a week. Lil Anthony’s P
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izza Palace nets $13,000 a week. Since Tony’s Pizza Shop is profitable, we can conclude
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that it has a competitive advantage in its industry.
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A) True—competitive advantage is achieved through profitability alone. e0 e0 e0 e0 e0 e0
B) True—competitive advantage is achieved since Tony has a positive net income. e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
C) False—
competitive advantage is only achieved by generating above average returns, relativ
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e to competition. e0 e0
D) False—
Tony more than likely has a sustained competitive advantage since he’s been in bus
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iness longer. e0
12) Bill’s Auto & Airplane Repair shop is able to generate a positive net income of $10,000
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a week, which is about the same as the income of a close competitor. As a result, we
0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
can conclude that the two businesses also have a competitive parity in the industry.
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A) Correct—competitive advantage is achieved through profitability alone. e0 e0 e0 e0 e0 e0
B) Correct—
competitive advantage is achieved since Bill’s Auto & Airplane Repair shop has a po
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sitive net income. e0 e0
C) Correct—competitive parity is a performance of two or more firms at the same level. e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
D) Incorrect—
Bill’s Auto & Airplane Repair shop more than likely has a sustained competiti
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ve advantage because the business is diversified.
e0 e0 e0 e0 e0 e0
e0 e0
STRATEGIC MANAGEMENT 6TH EDITION ROTHAER
e0 e0 e0 e0e0
MEL FRANK e0
ISBN 978-1266191862
e0
,Chapter 1-12 Answers are at the End of Each Chapter
e0 e 0 e0 e0 e0 e0 e0 e0 e0
Chapter 1 e0
Student name: e0
1) A good strategy allows a firm to achieve superior performance and sustainable competitiv
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
e advantage without regard to the external environment.
e0 e0 e0 e0 e0 e0 e0
⊚ true e 0
⊚ false e 0
2) The following statement by the chief executive of MegaFilms movie studio should not b
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
e used as a strategy: “We will produce the greatest films of the 21st century.”
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
⊚ true e 0
⊚ false e 0
3) The three tasks of the AFI strategy framework are to Assemble a prototype, Find a buyer, a
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
nd Incorporate feedback.
e0 e0
⊚ true e 0
⊚ false e 0
4) Questions asked during the strategy analysis stage of the AFI framework should include
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
“What effects do forces in the external environment have on the firm’s potential to gain an
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
d sustain a competitive advantage?”
e0 e0 e0 e0
⊚ true e 0
⊚ false e 0
,5) Once a strategy has been formulated and implemented, it is important that the firm sticks to
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
it no matter what happens.
e0 e0 e0 e0
⊚ true e 0
⊚ false e 0
6) Because they are a crucial component of a firm’s success, customers are considered intern
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
al stakeholders.
e0
⊚ true e 0
⊚ false e 0
7) A firm is required by society and its shareholders to meet its ethical and philanthropi
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
c responsibilities.
e0
⊚ true e 0
⊚ false e 0
8) Stakeholder impact analysis provides a decision tool that helps strategic leaders recognize th
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
e needs of different stakeholders.
e0 e0 e0 e0
⊚ true e 0
⊚ false e 0
9) Juan wants to open his own hot dog restaurant but doesn’t know anything about business.
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
He needs help determining who his competition is, how he should craft his strategy to co
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
mpete and how he’ll implement his strategy to achieve a competitive advantage. He’s hire
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
d you to help him get started. As a result, you will probably use which of the following?
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
A) AFI strategy framework e0 e0
B) Red Queen effect e0 e0
C) competitive benchmarking e0
D) Stakeholder Impact analysis e0 e0
, 10) Roberta is interested in the concept of strategy and decides to create her own. As a resul
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
t, Roberta says that her strategy is to focus on competitive benchmarking to achieve c
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
ompetitive advantage. Which is the best evaluation of Roberta’s statement?
e0 e0 e0 e0 e0 e0 e0 e0 e0
A) Roberta’s strategy is clear, but she should provide more detail. e0 e0 e0 e0 e0 e0 e0 e0 e0
B) Roberta’s strategy reveals a clear strategic position and tradeoff, so she shoul
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
d proceed. e0
C) Roberta should reevaluate her statement because it fails to mention more than on
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
e strategy. e0
D) Roberta should reevaluate her statement because it fails to meet the principles of wh
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
at a strategy should be. e0 e0 e0 e0
11) Tony’s Pizza Shop is able to net $10,000 a week; this makes the shop profitable. Its numb
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
er one competitor, Leo’s Pies, is also profitable, netting $12,000 a week. Lil Anthony’s P
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
izza Palace nets $13,000 a week. Since Tony’s Pizza Shop is profitable, we can conclude
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
that it has a competitive advantage in its industry.
e0 e0 e0 e0 e0 e0 e0 e0 e0
A) True—competitive advantage is achieved through profitability alone. e0 e0 e0 e0 e0 e0
B) True—competitive advantage is achieved since Tony has a positive net income. e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
C) False—
competitive advantage is only achieved by generating above average returns, relativ
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
e to competition. e0 e0
D) False—
Tony more than likely has a sustained competitive advantage since he’s been in bus
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iness longer. e0
12) Bill’s Auto & Airplane Repair shop is able to generate a positive net income of $10,000
e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e
a week, which is about the same as the income of a close competitor. As a result, we
0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
can conclude that the two businesses also have a competitive parity in the industry.
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A) Correct—competitive advantage is achieved through profitability alone. e0 e0 e0 e0 e0 e0
B) Correct—
competitive advantage is achieved since Bill’s Auto & Airplane Repair shop has a po
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sitive net income. e0 e0
C) Correct—competitive parity is a performance of two or more firms at the same level. e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0 e0
D) Incorrect—
Bill’s Auto & Airplane Repair shop more than likely has a sustained competiti
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ve advantage because the business is diversified.
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