COMPXM CAPSTONE BUSINESS
SIMULATION EXAM PREPARATION TEST
BANK WITH CORRECT ANSWERS
●● A conceptual model that helps strategists choose between seeking
internal development, entering into an alliance, or acquiring new
resources, capabilities, and competencies is called the "______
framework."
Multiple choice question.
Answer: Build-borrow-or-buy
●● Internal development should occur when the firm's resources are
_____ to those of competitors in the targeted area.
Answer: Both similar and superior
●● A firm should use an equity alliance, a joint venture, or an outright
acquisition in order to gain use of a resource when ______.
Answer: The resource is not easily traded.
●● What are the most expensive, complicated, and difficult to undo
options used to grow a firm?
Answer: Mergers and Acquisitions
,●● What are three options used by executives to drive firm growth?
(Check all that apply.)
Answer: Organic growth, alliances, and acquisitions
●● What are some advantages of strategic alliances? (Select all that
apply.)
Answer: They help firms achieve goals faster than they would alone.
They might give companies a competitive advantage.
●● Which of the following are the three choices in the build-borrow-or-
buy framework? (Check all that apply.)
Answer: Strategic alliances, internal development, and acquisition of
new resources
●● What must strategic alliances do in order to create the foundation for
a competitive advantage?
Answer: Form unique resource combinations that obey the VRIO
criteria.
●● Which framework can companies use to assess whether their internal
resources are superior to those of competitors in the targeted area?
Multiple choice question.
Answer: VRIO Framework
,●● True or false: Firms tend to enter strategic alliances when they have
no other choice.
Answer: False
●● In general, if a resource is highly tradable, then it should be ______
using a license or contractual agreement.
Answer: Borrowed
●● A firm might want to use a strategic alliance to ______.
Answer: Change the industry structure
●● A firm should consider using mergers and acquisitions only when
______.
Answer: It is important to be extremely close to the resource partner in
order to understand underlying information.
●● A voluntary arrangement between firms to share knowledge,
resources, and capabilities to develop products, processes, or services is
known as a ______.
Answer: Strategic alliance
●● How do foreign governments typically influence a firm's use of
strategic alliances to enter new markets?
, Answer: Governments may requires that foreign firms have a local joint
venture partner in order to conduct business within the country's borders.
●● Which of the following best exemplifies the relational view of
competitive advantage?
Answer: The strategic alliance between company A and company B
creates more value than either company individually.
●● A real option gives a firm the right to continue making investments
______.
Answer: But does not obligate the firm to do so.
●● One reason why a firm might enter into a strategic alliance is to
______.
Answer: Hedge against uncertainty
●● When a company makes incremental investments as part of a larger
investment and takes the time to analyze the information gained
following each incremental investment, the company is taking a ______.
Answer: Real-options perspective
●● True or false: Firms can use strategic alliances to strengthen their
competitive advantage when competing in battles to control industry
standards.
SIMULATION EXAM PREPARATION TEST
BANK WITH CORRECT ANSWERS
●● A conceptual model that helps strategists choose between seeking
internal development, entering into an alliance, or acquiring new
resources, capabilities, and competencies is called the "______
framework."
Multiple choice question.
Answer: Build-borrow-or-buy
●● Internal development should occur when the firm's resources are
_____ to those of competitors in the targeted area.
Answer: Both similar and superior
●● A firm should use an equity alliance, a joint venture, or an outright
acquisition in order to gain use of a resource when ______.
Answer: The resource is not easily traded.
●● What are the most expensive, complicated, and difficult to undo
options used to grow a firm?
Answer: Mergers and Acquisitions
,●● What are three options used by executives to drive firm growth?
(Check all that apply.)
Answer: Organic growth, alliances, and acquisitions
●● What are some advantages of strategic alliances? (Select all that
apply.)
Answer: They help firms achieve goals faster than they would alone.
They might give companies a competitive advantage.
●● Which of the following are the three choices in the build-borrow-or-
buy framework? (Check all that apply.)
Answer: Strategic alliances, internal development, and acquisition of
new resources
●● What must strategic alliances do in order to create the foundation for
a competitive advantage?
Answer: Form unique resource combinations that obey the VRIO
criteria.
●● Which framework can companies use to assess whether their internal
resources are superior to those of competitors in the targeted area?
Multiple choice question.
Answer: VRIO Framework
,●● True or false: Firms tend to enter strategic alliances when they have
no other choice.
Answer: False
●● In general, if a resource is highly tradable, then it should be ______
using a license or contractual agreement.
Answer: Borrowed
●● A firm might want to use a strategic alliance to ______.
Answer: Change the industry structure
●● A firm should consider using mergers and acquisitions only when
______.
Answer: It is important to be extremely close to the resource partner in
order to understand underlying information.
●● A voluntary arrangement between firms to share knowledge,
resources, and capabilities to develop products, processes, or services is
known as a ______.
Answer: Strategic alliance
●● How do foreign governments typically influence a firm's use of
strategic alliances to enter new markets?
, Answer: Governments may requires that foreign firms have a local joint
venture partner in order to conduct business within the country's borders.
●● Which of the following best exemplifies the relational view of
competitive advantage?
Answer: The strategic alliance between company A and company B
creates more value than either company individually.
●● A real option gives a firm the right to continue making investments
______.
Answer: But does not obligate the firm to do so.
●● One reason why a firm might enter into a strategic alliance is to
______.
Answer: Hedge against uncertainty
●● When a company makes incremental investments as part of a larger
investment and takes the time to analyze the information gained
following each incremental investment, the company is taking a ______.
Answer: Real-options perspective
●● True or false: Firms can use strategic alliances to strengthen their
competitive advantage when competing in battles to control industry
standards.
