MGT8803 - Strategy Exam (NEW UPDATED VERSION) LATEST
ACTUAL EXAM QUESTIONS AND CORRECT ANSWERS (VERIFIED
QUESTIONS AND ANSWERS) -GUARANTEED PASS A+ [2026-2027]
MGT8803 – Strategy 2 Practice Exam
1. What is the primary purpose of a SWOT analysis?
A. To assess financial performance
B. To identify strengths, weaknesses, opportunities, and threats
C. To evaluate employee satisfaction
D. To measure market share
Answer: B
Rationale: SWOT analysis evaluates internal and external factors affecting strategy.
2. Which of the following is a key component of corporate strategy?
A. Pricing decisions
B. Deciding which industries or markets the firm should compete in
C. Employee scheduling
D. Daily operational procedures
Answer: B
Rationale: Corporate strategy focuses on overall scope and direction of the organization.
3. What is a competitive advantage?
A. A temporary market trend
B. A firm’s unique strengths allowing it to outperform competitors
C. A type of accounting method
1
D. A government subsidy
Page
2026 Graded A+ EXAM
, Answer: B
Rationale: Competitive advantage allows sustained superior performance over rivals.
4. The VRIO framework assesses resources based on:
A. Value, Rarity, Imitability, Organization
B. Vision, Revenue, Innovation, Operations
C. Variables, Risks, Income, Objectives
D. Valuation, Research, Implementation, Optimization
Answer: A
Rationale: VRIO determines if resources provide sustainable competitive advantage.
5. PESTEL analysis evaluates:
A. Internal operational efficiency
B. External macro-environmental factors
C. Customer satisfaction
D. Employee engagement
Answer: B
Rationale: PESTEL assesses Political, Economic, Social, Technological, Environmental, and
Legal influences.
6. Which growth strategy involves acquiring or merging with other firms?
A. Organic growth
B. Horizontal or vertical integration
C. Retrenchment
D. Diversification
Answer: B
Rationale: Integration strategies expand market share or production capabilities via acquisitions
or mergers.
7. Porter's Five Forces does NOT include:
2
A. Threat of new entrants
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B. Bargaining power of suppliers
2026 Graded A+ EXAM
, C. Employee satisfaction
D. Threat of substitute products
Answer: C
Rationale: Porter's framework evaluates industry attractiveness, not internal HR metrics.
8. A differentiation strategy aims to:
A. Offer lower costs than competitors
B. Provide unique products/services valued by customers
C. Exit the market
D. Reduce production volume
Answer: B
Rationale: Differentiation creates customer preference and premium pricing potential.
9. Which strategy focuses on reducing costs to gain competitive advantage?
A. Cost leadership
B. Differentiation
C. Diversification
D. Retrenchment
Answer: A
Rationale: Cost leadership emphasizes operational efficiency and low-cost delivery.
10. Which type of diversification spreads risk across unrelated industries?
A. Concentric
B. Horizontal
C. Conglomerate
D. Vertical
Answer: C
Rationale: Conglomerate diversification reduces dependency on a single market or industry.
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Page
2026 Graded A+ EXAM
, 11. The BCG matrix classifies business units based on:
A. Market share and market growth
B. Profit margin only
C. Employee satisfaction
D. Product quality
Answer: A
Rationale: BCG identifies “Stars,” “Cash Cows,” “Question Marks,” and “Dogs.”
12. A “Star” in the BCG matrix is characterized by:
A. Low market share, high growth
B. High market share, high growth
C. Low market share, low growth
D. High market share, low growth
Answer: B
Rationale: Stars are leaders in growing markets, requiring investment to sustain growth.
13. Which is an example of a forward integration strategy?
A. Manufacturer opening retail stores
B. Supplier producing raw materials
C. Outsourcing production
D. Downsizing operations
Answer: A
Rationale: Forward integration expands control toward the customer end of the value chain.
14. Blue Ocean Strategy focuses on:
A. Competing in existing markets
B. Creating uncontested market space
C. Reducing operational costs only
D. Entering foreign markets
Answer: B
Rationale: Blue Ocean strategy emphasizes innovation and value creation to avoid competition.
4
Page
2026 Graded A+ EXAM
ACTUAL EXAM QUESTIONS AND CORRECT ANSWERS (VERIFIED
QUESTIONS AND ANSWERS) -GUARANTEED PASS A+ [2026-2027]
MGT8803 – Strategy 2 Practice Exam
1. What is the primary purpose of a SWOT analysis?
A. To assess financial performance
B. To identify strengths, weaknesses, opportunities, and threats
C. To evaluate employee satisfaction
D. To measure market share
Answer: B
Rationale: SWOT analysis evaluates internal and external factors affecting strategy.
2. Which of the following is a key component of corporate strategy?
A. Pricing decisions
B. Deciding which industries or markets the firm should compete in
C. Employee scheduling
D. Daily operational procedures
Answer: B
Rationale: Corporate strategy focuses on overall scope and direction of the organization.
3. What is a competitive advantage?
A. A temporary market trend
B. A firm’s unique strengths allowing it to outperform competitors
C. A type of accounting method
1
D. A government subsidy
Page
2026 Graded A+ EXAM
, Answer: B
Rationale: Competitive advantage allows sustained superior performance over rivals.
4. The VRIO framework assesses resources based on:
A. Value, Rarity, Imitability, Organization
B. Vision, Revenue, Innovation, Operations
C. Variables, Risks, Income, Objectives
D. Valuation, Research, Implementation, Optimization
Answer: A
Rationale: VRIO determines if resources provide sustainable competitive advantage.
5. PESTEL analysis evaluates:
A. Internal operational efficiency
B. External macro-environmental factors
C. Customer satisfaction
D. Employee engagement
Answer: B
Rationale: PESTEL assesses Political, Economic, Social, Technological, Environmental, and
Legal influences.
6. Which growth strategy involves acquiring or merging with other firms?
A. Organic growth
B. Horizontal or vertical integration
C. Retrenchment
D. Diversification
Answer: B
Rationale: Integration strategies expand market share or production capabilities via acquisitions
or mergers.
7. Porter's Five Forces does NOT include:
2
A. Threat of new entrants
Page
B. Bargaining power of suppliers
2026 Graded A+ EXAM
, C. Employee satisfaction
D. Threat of substitute products
Answer: C
Rationale: Porter's framework evaluates industry attractiveness, not internal HR metrics.
8. A differentiation strategy aims to:
A. Offer lower costs than competitors
B. Provide unique products/services valued by customers
C. Exit the market
D. Reduce production volume
Answer: B
Rationale: Differentiation creates customer preference and premium pricing potential.
9. Which strategy focuses on reducing costs to gain competitive advantage?
A. Cost leadership
B. Differentiation
C. Diversification
D. Retrenchment
Answer: A
Rationale: Cost leadership emphasizes operational efficiency and low-cost delivery.
10. Which type of diversification spreads risk across unrelated industries?
A. Concentric
B. Horizontal
C. Conglomerate
D. Vertical
Answer: C
Rationale: Conglomerate diversification reduces dependency on a single market or industry.
3
Page
2026 Graded A+ EXAM
, 11. The BCG matrix classifies business units based on:
A. Market share and market growth
B. Profit margin only
C. Employee satisfaction
D. Product quality
Answer: A
Rationale: BCG identifies “Stars,” “Cash Cows,” “Question Marks,” and “Dogs.”
12. A “Star” in the BCG matrix is characterized by:
A. Low market share, high growth
B. High market share, high growth
C. Low market share, low growth
D. High market share, low growth
Answer: B
Rationale: Stars are leaders in growing markets, requiring investment to sustain growth.
13. Which is an example of a forward integration strategy?
A. Manufacturer opening retail stores
B. Supplier producing raw materials
C. Outsourcing production
D. Downsizing operations
Answer: A
Rationale: Forward integration expands control toward the customer end of the value chain.
14. Blue Ocean Strategy focuses on:
A. Competing in existing markets
B. Creating uncontested market space
C. Reducing operational costs only
D. Entering foreign markets
Answer: B
Rationale: Blue Ocean strategy emphasizes innovation and value creation to avoid competition.
4
Page
2026 Graded A+ EXAM
