1 | Page
Strategic MGMT - Chapter 4 EXAM
QUESTIONS WITH CORRECT ANSWERS
Questions and Correct Answers
Religious beliefs are an example of customer segmentation by
______ factors.
a. demographic
b. socioeconomic
c. psychological
d. geographic Ans: C
A flexible manufacturing system is
a. based on the use of temporary and part-time employees as well
as outsourcing.
b. a system that identifies "the one best way" to produce each
product in the company's line.
c. based on a 360-degree view of the company's relationships with
customers.
d. a computer-controlled process that is used to produce a variety
of products in moderate, flexible quantities with minimal human
intervention. Ans: D
Walmart went against business-level strategy and made changes to
attract upscale customers. These changes had which of the
following results?
a. attracted significant numbers of new customers.
b. Family Dollar, Dollar Tree, and Dollar General all experienced
losses in sales as many of their customers went to Walmart.
c. It strengthened Walmart's position against rivals such as Dollar
Stores and Amazon.
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d. It made Walmart vulnerable to Dollar Store and Amazon. Ans: D
An interior decorator has moved his business from Los Angeles to
St. Paul, Minnesota, because his spouse's company transferred her
to St. Paul. The decorator is distressed because the customers in
his target market have, in his words, "banal and bourgeois taste."
What is the decorator's problem?
a. The decorator does not understand that customer needs are
neither right nor wrong, good nor bad.
b. The decorator is highly affiliated with the new target market
and understands how he can create value for it.
c. The decorator should choose a strategy of cost leadership in this
environment.
d. The decorator has no core competencies that will transfer to his
new geographic market. Ans: A
Mercedes mass produces luxury vehicles at a premium price. It
uses a(n) ______ strategy.
a. focused cost leadership
b. integrated cost leadership/differentiation
c. differentiation
d. focused differentiation Ans: C
Before the firm decides what products to offer and what benefits
and features they will have, the firm must decide all the following
questions EXCEPT
a. what core competencies are needed to satisfy customer needs.
b. what needs the firm should satisfy.
c. when the customer's needs should be satisfied.
d. who the firm should serve. Ans: C
The differentiation strategy can be effective in controlling the
power of rivalry with existing competitors in an industry because
© 2025 All rights reserved
Strategic MGMT - Chapter 4 EXAM
QUESTIONS WITH CORRECT ANSWERS
Questions and Correct Answers
Religious beliefs are an example of customer segmentation by
______ factors.
a. demographic
b. socioeconomic
c. psychological
d. geographic Ans: C
A flexible manufacturing system is
a. based on the use of temporary and part-time employees as well
as outsourcing.
b. a system that identifies "the one best way" to produce each
product in the company's line.
c. based on a 360-degree view of the company's relationships with
customers.
d. a computer-controlled process that is used to produce a variety
of products in moderate, flexible quantities with minimal human
intervention. Ans: D
Walmart went against business-level strategy and made changes to
attract upscale customers. These changes had which of the
following results?
a. attracted significant numbers of new customers.
b. Family Dollar, Dollar Tree, and Dollar General all experienced
losses in sales as many of their customers went to Walmart.
c. It strengthened Walmart's position against rivals such as Dollar
Stores and Amazon.
© 2025 All rights reserved
, 2 | Page
d. It made Walmart vulnerable to Dollar Store and Amazon. Ans: D
An interior decorator has moved his business from Los Angeles to
St. Paul, Minnesota, because his spouse's company transferred her
to St. Paul. The decorator is distressed because the customers in
his target market have, in his words, "banal and bourgeois taste."
What is the decorator's problem?
a. The decorator does not understand that customer needs are
neither right nor wrong, good nor bad.
b. The decorator is highly affiliated with the new target market
and understands how he can create value for it.
c. The decorator should choose a strategy of cost leadership in this
environment.
d. The decorator has no core competencies that will transfer to his
new geographic market. Ans: A
Mercedes mass produces luxury vehicles at a premium price. It
uses a(n) ______ strategy.
a. focused cost leadership
b. integrated cost leadership/differentiation
c. differentiation
d. focused differentiation Ans: C
Before the firm decides what products to offer and what benefits
and features they will have, the firm must decide all the following
questions EXCEPT
a. what core competencies are needed to satisfy customer needs.
b. what needs the firm should satisfy.
c. when the customer's needs should be satisfied.
d. who the firm should serve. Ans: C
The differentiation strategy can be effective in controlling the
power of rivalry with existing competitors in an industry because
© 2025 All rights reserved
