Strategic Management and Competitive Advantage, 4e (Barney) Chapter 2 Evaluating a Firm's External Environment

1) A firm's general environment consists of broad trends in the context within which the firm operates that can have an impact on the firm's strategic choices. Answer: TRUE Diff: 1 Page Ref: 30 Objective: 2.1 2) In general, technological change creates opportunities, but not threats. Answer: FALSE Diff: 2 Page Ref: 31 Objective: 2.1 3) The aging of the "baby boomer" generation in American society is an example of a demographic trend. Answer: TRUE Diff: 2 Page Ref: 31 Objective: 2.1 4) Culture is the values, beliefs and norms that guide a behavior in a society, and culture is largely the same across the world. Answer: FALSE Diff: 2 Page Ref: 32 Objective: 2.1 5) A severe recession that lasts for several years is known as a depression. Answer: TRUE Diff: 1 Page Ref: 32 Objective: 2.1 6) In the structure-conduct-performance model, the term "structure" refers to industry structure, measured by such factors as the number of competitors in an industry. Answer: TRUE Diff: 2 Page Ref: 34 Objective: 2.2 7) In the structure-conduct-performance model, the term "performance" refers solely to the performance of individual firms. Answer: FALSE Diff: 2 Page Ref: 34 Objective: 2.2 1 8) In a perfectly competitive industry, a large number of firms have products and services that are similar to each other and it is not very costly for firms to enter into or exit these markets. Answer: TRUE Diff: 2 Page Ref: 37 Objective: 2.2 9) The S-C-P model assumes that any competitive advantages a firm has in an industry must benefit society. Answer: FALSE Diff: 3 Page Ref: 37 Objective: 2.2 10) According to the S-C-P model, attributes of the industry structure within which a firm operates define the range of options and constraints facing a firm. Answer: TRUE Diff: 2 Page Ref: 37 Objective: 2.2 11) The five forces framework is based on the S-C-P model and identifies the five most common threats facing firms from their local competitive environment and the conditions under which these threats are more or less li