,
,6. The primary drivers of hypercompetition are __________ and __________.
a. rising global socio-economic instability; increased inflation
b. the emergence of a global economy; rapid technological change
c. increased global competition; decreased tariffs
d. increased availability of capital; increased competition
ANSWER: b
POINTS: 1
DIFFICULTY: Easy
REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Remember
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/15/2023 2:15 PM
7. All of the following are characteristics of the global economy EXCEPT:
a. the increasing importance of emerging economies as sources of revenue growth.
b. the free movement of goods, services, people, skills, and ideas across geographic borders.
c. the increased use of tariffs to protect industries.
d. higher levels of opportunities and challenges in new geographic markets.
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Diversity
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 4/19/2023 5:02 PM
8. The increasing economic interdependence among countries and their organizations as reflected in the flow of products,
financial capital, and knowledge across country borders is defined as
a. hypercompetition.
b. boundaryless retailing.
c. strategic intensity.
d. globalization.
ANSWER: d
POINTS: 1
DIFFICULTY: Easy
Copyright Cengage Learning. Powered by Cognero. Page 3
,REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES:SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Diversity
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:18 PM
9. New markets created by the technologies underlying the development of products such as iPads and Wi-Fi are a result
of
a. disruptive technologies.
b. global competition.
c. knowledge intensity.
d. hypercompetition.
ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 4:22 PM
10. The CEO of Ridgeway, Inc., realizes that the company's survival depends on developing and acquiring knowledge.
Which of the following actions by the CEO would be MOST consistent with this need?
a. Ensuring that all current, unique knowledge of the firm is protected by patents
b. Planning extensive employee training and hiring educated and experienced employees
c. Investing in sophisticated databases in relevant knowledge areas
d. Establishing a system of organizational intelligence gathering
ANSWER: b
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
Copyright Cengage Learning. Powered by Cognero. Page 4
,DATE MODIFIED: 4/19/2023 5:02 PM
11. RelTech has developed a proprietary approach to supply chain management and uses that expertise as a source of
competitive advantage. RelTech is relying on what intangible asset as a basis of competition?
a. Knowledge
b. Insight
c. Intensity
d. Strategic flexibility
ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Analyze
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 4/19/2023 5:02 PM
12. All of the following are assumptions of the industrial organization (I/O) model EXCEPT:
a. organizational decision makers are assumed to be rational and committed to acting in the firm's best interests.
b. resources to implement strategies are firm-specific and attached to firms over the long-term.
c. the external environment is assumed to impose pressures and constraints that determine the strategies that
would result in above-average returns.
d. most firms competing within an industry or within a segment of that industry are assumed to control similar
strategically relevant resources and to pursue similar strategies in light of those resources.
ANSWER: b
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-3 The I/O Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.03 - Use the industrial organization (I/O) model to explain how firms can
earn above-average returns
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 4/19/2023 5:02 PM
13. The industrial organization (I/O) model argues that the
a. key factor in success is choosing the correct industry in which to compete.
b. firm's internal resources and capabilities represent the foundation for development of a value-creating strategy.
c. key to earning above-average returns is strategic flexibility.
d. internal structure of the organization must match the industry in which it competes for it to earn above-average
returns on investment.
Copyright Cengage Learning. Powered by Cognero. Page 5
,ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-3 The I/O Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES:SM.HITT.24.01.03 - Use the industrial organization (I/O) model to explain how firms can
earn above-average returns
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:20 PM
14. Which of the following statements is MOST consistent with the I/O view? Performance of a firm is most directly
attributable to
a. the power of the financial market stakeholders.
b. the resources the firm possesses.
c. the profitability of the industry in which the firm competes.
d. hypercompetition within the industry.
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-3 The I/O Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.03 - Use the industrial organization (I/O) model to explain how firms can
earn above-average returns
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:19 PM
15. Alibaba is a company in the Internet services industry that has improved its performance by focusing on its unique
abilities in the area of innovation and service diversification. This improved performance is best explained by
a. globalization.
b. the resource-based model.
c. the industrial organization (I/O) model.
d. hypercompetition.
ANSWER: b
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-4 The Resource-Based Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.04 - Use the resource-based model to explain how firms can earn above-
average returns.
Copyright Cengage Learning. Powered by Cognero. Page 6
,NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:19 PM
16. An investor is considering in which of two start-up companies to invest. The investor has faith in the industrial
organization (I/O) model of above-average returns and is using that as a guideline to make a decision. Both start-up
companies propose to manufacture health-focused foods with low salt, low sugar, high fiber, and no artificial additives.
RexRich Foods has a business strategy of producing a differentiated product for which consumers will pay more. Green
Pastures Foods is in the health-foods industry because of its internal culture and commitment to healthy lifestyles, but it
does not have any executives with experience in food production. Which investment decision is the investor most likely to
make?
a. The investor will select Green Pastures Foods since it is most consistent with the I/O model.
b. The investor will select RexRich Foods since it is most consistent with the I/O model.
c. Since both firms are consistent with the I/O model, the investor will seek additional information before
making a decision.
d. At the entrepreneurial stage, the model that companies follow is not important, and the investor will wait
before making any investments.
ANSWER: b
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-3 The I/O Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.03 - Use the industrial organization (I/O) model to explain how firms can
earn above-average returns
NATIONAL STANDARDS: United States - BUS PROG: Reflective Thinking
KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 4/19/2023 5:02 PM
17. All of the following are resources of an organization EXCEPT:
a. an hourly production employee's ability to catch subtle quality defects in products.
b. oil drilling rights in a promising region.
c. weak competitors in the industry.
d. a charity's board of directors of experienced executives.
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-4 The Resource-Based Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.04 - Use the resource-based model to explain how firms can earn above-
average returns.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
Copyright Cengage Learning. Powered by Cognero. Page 7
,DATE MODIFIED: 4/19/2023 5:02 PM
18. All of the following are assumptions of the resource-based model EXCEPT:
a. firms acquire different resources and develop unique capabilities based on how they combine and use
resources.
b. firms' performances across time are due primarily to their unique resources and capabilities rather than the
industry's structural characteristics.
c. resources and capabilities are highly mobile across firms.
d. differences in resources and capabilities are the basis of competitive advantage.
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-4 The Resource-Based Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.04 - Use the resource-based model to explain how firms can earn above-
average returns.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/15/2023 2:35 PM
19. What is the capacity for a set of resources to perform a task or an activity in an integrative manner considered?
a. A capability
b. A core competence
c. Sustainable competitive advantage
d. Organizational intelligence
ANSWER: a
POINTS: 1
DIFFICULTY: Easy
REFERENCES: 1-4 The Resource-Based Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.04 - Use the resource-based model to explain how firms can earn above-
average returns.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Remember
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 4:25 PM
20. When capabilities serve as a source of competitive advantage for a firm over its rivals, the firm has created a(n)
a. strategic mission.
b. inspiring vision.
c. core competence.
d. sustainable market niche.
ANSWER: c
Copyright Cengage Learning. Powered by Cognero. Page 8
,POINTS: 1
DIFFICULTY: Easy
REFERENCES: 1-4 The Resource-Based Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES:SM.HITT.24.01.04 - Use the resource-based model to explain how firms can earn above-
average returns.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Remember
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:21 PM
21. What is the goal of an organization which points the firm in the direction of where it would like to be in the years to
come known as?
a. Its vision
b. Its mission
c. Its culture
d. Its strategy
ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-6 Vision, Mission, and Values
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.06 - Describe vision, mission, and values, and explain why they are
important.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 4:27 PM
22. The Princeton Alliance Church states on its website that "PAC exists to help you live life to the fullest by knowing
God, developing community and bringing hope." This pronouncement is MOST precisely a statement of organizational
a. values.
b. structure.
c. vision.
d. culture.
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-6 Vision, Mission, and Values
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.06 - Describe vision, mission, and values, and explain why they are
important.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
Copyright Cengage Learning. Powered by Cognero. Page 9
, KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:22 PM
23. Jan is the CEO of GlenOak Corp. After analyzing GlenOak's vision statement and aligning it with new environmental
conditions, Jan rewrote GlenOak's mission. Which of the following best characterizes Jan's action?
a. Jan should have involved managers at all levels in the firm as well as employees who interact with customers
and the markets for input when rewriting the mission statement.
b. Because a mission can change along with environmental circumstances, Jan did the right thing in rewriting the
mission.
c. Because the CEO has the final responsibility for forming a firm's mission, it was proper for Jan to rewrite the
mission statement.
d. A mission statement is an enduring reflection of the values and aspirations of a firm, and Jan should not have
rewritten it.
ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-6 Vision, Mission, and Values
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.06 - Describe vision, mission, and values, and explain why they are
important.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Analyze
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/15/2023 2:44 PM
24. A key purpose of a vision and mission statement is to define what a firm is, what it seeks to accomplish, and who it
seeks to serve. Who is this statement meant to inform?
a. CEOs
b. Stakeholders
c. Regulators
d. Former employees
ANSWER: b
POINTS: 1
DIFFICULTY: Easy
REFERENCES: 1-6 Vision and Mission
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.06 - Describe vision, mission, and values, and explain why they are
important.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Remember
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 4:29 PM
25. Todd works at EnergyOne and also owns shares of stock in the company and is a member in the union there. Todd
Copyright Cengage Learning. Powered by Cognero. Page 10
,6. The primary drivers of hypercompetition are __________ and __________.
a. rising global socio-economic instability; increased inflation
b. the emergence of a global economy; rapid technological change
c. increased global competition; decreased tariffs
d. increased availability of capital; increased competition
ANSWER: b
POINTS: 1
DIFFICULTY: Easy
REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Remember
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/15/2023 2:15 PM
7. All of the following are characteristics of the global economy EXCEPT:
a. the increasing importance of emerging economies as sources of revenue growth.
b. the free movement of goods, services, people, skills, and ideas across geographic borders.
c. the increased use of tariffs to protect industries.
d. higher levels of opportunities and challenges in new geographic markets.
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Diversity
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 4/19/2023 5:02 PM
8. The increasing economic interdependence among countries and their organizations as reflected in the flow of products,
financial capital, and knowledge across country borders is defined as
a. hypercompetition.
b. boundaryless retailing.
c. strategic intensity.
d. globalization.
ANSWER: d
POINTS: 1
DIFFICULTY: Easy
Copyright Cengage Learning. Powered by Cognero. Page 3
,REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES:SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Diversity
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:18 PM
9. New markets created by the technologies underlying the development of products such as iPads and Wi-Fi are a result
of
a. disruptive technologies.
b. global competition.
c. knowledge intensity.
d. hypercompetition.
ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 4:22 PM
10. The CEO of Ridgeway, Inc., realizes that the company's survival depends on developing and acquiring knowledge.
Which of the following actions by the CEO would be MOST consistent with this need?
a. Ensuring that all current, unique knowledge of the firm is protected by patents
b. Planning extensive employee training and hiring educated and experienced employees
c. Investing in sophisticated databases in relevant knowledge areas
d. Establishing a system of organizational intelligence gathering
ANSWER: b
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
Copyright Cengage Learning. Powered by Cognero. Page 4
,DATE MODIFIED: 4/19/2023 5:02 PM
11. RelTech has developed a proprietary approach to supply chain management and uses that expertise as a source of
competitive advantage. RelTech is relying on what intangible asset as a basis of competition?
a. Knowledge
b. Insight
c. Intensity
d. Strategic flexibility
ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-2 The Competitive Landscape
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.02 - Describe the competitive landscape, and explain how globalization,
technological changes, and expectations of socially responsible behavior shape it.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Analyze
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 4/19/2023 5:02 PM
12. All of the following are assumptions of the industrial organization (I/O) model EXCEPT:
a. organizational decision makers are assumed to be rational and committed to acting in the firm's best interests.
b. resources to implement strategies are firm-specific and attached to firms over the long-term.
c. the external environment is assumed to impose pressures and constraints that determine the strategies that
would result in above-average returns.
d. most firms competing within an industry or within a segment of that industry are assumed to control similar
strategically relevant resources and to pursue similar strategies in light of those resources.
ANSWER: b
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-3 The I/O Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.03 - Use the industrial organization (I/O) model to explain how firms can
earn above-average returns
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 4/19/2023 5:02 PM
13. The industrial organization (I/O) model argues that the
a. key factor in success is choosing the correct industry in which to compete.
b. firm's internal resources and capabilities represent the foundation for development of a value-creating strategy.
c. key to earning above-average returns is strategic flexibility.
d. internal structure of the organization must match the industry in which it competes for it to earn above-average
returns on investment.
Copyright Cengage Learning. Powered by Cognero. Page 5
,ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-3 The I/O Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES:SM.HITT.24.01.03 - Use the industrial organization (I/O) model to explain how firms can
earn above-average returns
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:20 PM
14. Which of the following statements is MOST consistent with the I/O view? Performance of a firm is most directly
attributable to
a. the power of the financial market stakeholders.
b. the resources the firm possesses.
c. the profitability of the industry in which the firm competes.
d. hypercompetition within the industry.
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-3 The I/O Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.03 - Use the industrial organization (I/O) model to explain how firms can
earn above-average returns
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:19 PM
15. Alibaba is a company in the Internet services industry that has improved its performance by focusing on its unique
abilities in the area of innovation and service diversification. This improved performance is best explained by
a. globalization.
b. the resource-based model.
c. the industrial organization (I/O) model.
d. hypercompetition.
ANSWER: b
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-4 The Resource-Based Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.04 - Use the resource-based model to explain how firms can earn above-
average returns.
Copyright Cengage Learning. Powered by Cognero. Page 6
,NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:19 PM
16. An investor is considering in which of two start-up companies to invest. The investor has faith in the industrial
organization (I/O) model of above-average returns and is using that as a guideline to make a decision. Both start-up
companies propose to manufacture health-focused foods with low salt, low sugar, high fiber, and no artificial additives.
RexRich Foods has a business strategy of producing a differentiated product for which consumers will pay more. Green
Pastures Foods is in the health-foods industry because of its internal culture and commitment to healthy lifestyles, but it
does not have any executives with experience in food production. Which investment decision is the investor most likely to
make?
a. The investor will select Green Pastures Foods since it is most consistent with the I/O model.
b. The investor will select RexRich Foods since it is most consistent with the I/O model.
c. Since both firms are consistent with the I/O model, the investor will seek additional information before
making a decision.
d. At the entrepreneurial stage, the model that companies follow is not important, and the investor will wait
before making any investments.
ANSWER: b
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-3 The I/O Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.03 - Use the industrial organization (I/O) model to explain how firms can
earn above-average returns
NATIONAL STANDARDS: United States - BUS PROG: Reflective Thinking
KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 4/19/2023 5:02 PM
17. All of the following are resources of an organization EXCEPT:
a. an hourly production employee's ability to catch subtle quality defects in products.
b. oil drilling rights in a promising region.
c. weak competitors in the industry.
d. a charity's board of directors of experienced executives.
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-4 The Resource-Based Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.04 - Use the resource-based model to explain how firms can earn above-
average returns.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
Copyright Cengage Learning. Powered by Cognero. Page 7
,DATE MODIFIED: 4/19/2023 5:02 PM
18. All of the following are assumptions of the resource-based model EXCEPT:
a. firms acquire different resources and develop unique capabilities based on how they combine and use
resources.
b. firms' performances across time are due primarily to their unique resources and capabilities rather than the
industry's structural characteristics.
c. resources and capabilities are highly mobile across firms.
d. differences in resources and capabilities are the basis of competitive advantage.
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-4 The Resource-Based Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.04 - Use the resource-based model to explain how firms can earn above-
average returns.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/15/2023 2:35 PM
19. What is the capacity for a set of resources to perform a task or an activity in an integrative manner considered?
a. A capability
b. A core competence
c. Sustainable competitive advantage
d. Organizational intelligence
ANSWER: a
POINTS: 1
DIFFICULTY: Easy
REFERENCES: 1-4 The Resource-Based Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.04 - Use the resource-based model to explain how firms can earn above-
average returns.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Remember
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 4:25 PM
20. When capabilities serve as a source of competitive advantage for a firm over its rivals, the firm has created a(n)
a. strategic mission.
b. inspiring vision.
c. core competence.
d. sustainable market niche.
ANSWER: c
Copyright Cengage Learning. Powered by Cognero. Page 8
,POINTS: 1
DIFFICULTY: Easy
REFERENCES: 1-4 The Resource-Based Model of Above-Average Returns
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES:SM.HITT.24.01.04 - Use the resource-based model to explain how firms can earn above-
average returns.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Remember
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:21 PM
21. What is the goal of an organization which points the firm in the direction of where it would like to be in the years to
come known as?
a. Its vision
b. Its mission
c. Its culture
d. Its strategy
ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-6 Vision, Mission, and Values
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.06 - Describe vision, mission, and values, and explain why they are
important.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Understand
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 4:27 PM
22. The Princeton Alliance Church states on its website that "PAC exists to help you live life to the fullest by knowing
God, developing community and bringing hope." This pronouncement is MOST precisely a statement of organizational
a. values.
b. structure.
c. vision.
d. culture.
ANSWER: c
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-6 Vision, Mission, and Values
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.06 - Describe vision, mission, and values, and explain why they are
important.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
Copyright Cengage Learning. Powered by Cognero. Page 9
, KEYWORDS: Bloom's: Apply
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 6:22 PM
23. Jan is the CEO of GlenOak Corp. After analyzing GlenOak's vision statement and aligning it with new environmental
conditions, Jan rewrote GlenOak's mission. Which of the following best characterizes Jan's action?
a. Jan should have involved managers at all levels in the firm as well as employees who interact with customers
and the markets for input when rewriting the mission statement.
b. Because a mission can change along with environmental circumstances, Jan did the right thing in rewriting the
mission.
c. Because the CEO has the final responsibility for forming a firm's mission, it was proper for Jan to rewrite the
mission statement.
d. A mission statement is an enduring reflection of the values and aspirations of a firm, and Jan should not have
rewritten it.
ANSWER: a
POINTS: 1
DIFFICULTY: Moderate
REFERENCES: 1-6 Vision, Mission, and Values
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.06 - Describe vision, mission, and values, and explain why they are
important.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Analyze
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/15/2023 2:44 PM
24. A key purpose of a vision and mission statement is to define what a firm is, what it seeks to accomplish, and who it
seeks to serve. Who is this statement meant to inform?
a. CEOs
b. Stakeholders
c. Regulators
d. Former employees
ANSWER: b
POINTS: 1
DIFFICULTY: Easy
REFERENCES: 1-6 Vision and Mission
QUESTION TYPE: Multiple Choice
HAS VARIABLES: False
LEARNING OBJECTIVES: SM.HITT.24.01.06 - Describe vision, mission, and values, and explain why they are
important.
NATIONAL STANDARDS: United States - BUSPROG: Analytic | Technology - BUSPROG: Analytic
KEYWORDS: Bloom's: Remember
DATE CREATED: 4/19/2023 5:02 PM
DATE MODIFIED: 5/17/2023 4:29 PM
25. Todd works at EnergyOne and also owns shares of stock in the company and is a member in the union there. Todd
Copyright Cengage Learning. Powered by Cognero. Page 10
