MGT 8803 LATEST 2026 STUDY GUIDE QUESTIONS AND
SOLUTIONS GRADED A+
✔✔3 components of a business model - ✔✔(1) value delivery (how customers are
reached and served)
(2) value creation (how the product/service is made),
(3) value capture (how the firm makes money).
✔✔What is the primary aim in cost leadership? - ✔✔the lowest costs in a broad market
(e.g., Walmart).
✔✔Differentiation vs Focus approach - ✔✔When a company seeks to offer unique value
at a premium price in a broad market (e.g., Apple). Focus targets a narrow niche with
either cost leadership or differentiation (e.g., Rolex).
✔✔What type of planning works well in a stable environment? - ✔✔top-down
✔✔What type of planning works well in a unstable environment? - ✔✔flexible methods
like scenario planning, which develops strategies for multiple plausible futures
✔✔What are some examples of political variables in PESTEL? - ✔✔-subsidies
-favorable tax policies
-pricing controls
-regulated access
-grants
-trade controls/imports restrictions
-tariffs
✔✔Which area of PESTEL can be influenced by an individual firm? How? - ✔✔Political
variables. Lobbying efforts, litigating against policies, supporting legislators
✔✔Primary impact of political variables - ✔✔opens or restricts access to markets by
creating or eliminated barriers to entry
✔✔Primary impact of socio-cultural variables - ✔✔impacts what consumers want to buy,
market sizes, and increases management complexity of a diverse workforce.
✔✔Cost structure - ✔✔The types and proportions of expenses a company incurs in its
operations.
✔✔Economies of Scale - ✔✔Cost advantages that a firm gains by increasing its scale of
production.
, ✔✔Economies of Scope - ✔✔Cost advantages that a firm gains by offering a wider
range of products or services.
✔✔Disruptive Innovation - ✔✔An innovation that creates a new market and value
network and eventually disrupts an existing market and value network, displacing
established market-leading firms and products.
✔✔The broadest level of planning - ✔✔strategic planning
✔✔Drives decisions about resource allocation - ✔✔strategic planning
✔✔T or F: Strategic planning primarily involves specific rather than directional goals. -
✔✔False
✔✔Examples of functional planning - ✔✔marketing plans, production plans, supply
chain management plans, and financial plans
✔✔Which type of planning focuses on implementing the SBU's strategies? -
✔✔functional
✔✔Who develops functional plans? - ✔✔senior and middle-level managers
✔✔The most specific and narrow plans - ✔✔Tactical/Operational Planning
✔✔What is the focus of tactical plans? - ✔✔day-to-day execution of functional plans
✔✔Examples of tactical planning - ✔✔production schedules, delivery schedules,
staffing schedules, project work plans, sales call schedules, and operating budgets
✔✔How long are tactical planning horizons? - ✔✔quarterly to hourly
✔✔Who develops tactical plans? - ✔✔lower levels of management and at the team
leader level
✔✔T or F: If lower-level goals are reached, then the higher-level goals are achieved -
✔✔True
✔✔What are the two fundamental and distinct generic business strategies aimed at
achieving competitive advantage? - ✔✔Cost leadership and differentiation
✔✔Cost leadership targets a ___ market. - ✔✔broad
SOLUTIONS GRADED A+
✔✔3 components of a business model - ✔✔(1) value delivery (how customers are
reached and served)
(2) value creation (how the product/service is made),
(3) value capture (how the firm makes money).
✔✔What is the primary aim in cost leadership? - ✔✔the lowest costs in a broad market
(e.g., Walmart).
✔✔Differentiation vs Focus approach - ✔✔When a company seeks to offer unique value
at a premium price in a broad market (e.g., Apple). Focus targets a narrow niche with
either cost leadership or differentiation (e.g., Rolex).
✔✔What type of planning works well in a stable environment? - ✔✔top-down
✔✔What type of planning works well in a unstable environment? - ✔✔flexible methods
like scenario planning, which develops strategies for multiple plausible futures
✔✔What are some examples of political variables in PESTEL? - ✔✔-subsidies
-favorable tax policies
-pricing controls
-regulated access
-grants
-trade controls/imports restrictions
-tariffs
✔✔Which area of PESTEL can be influenced by an individual firm? How? - ✔✔Political
variables. Lobbying efforts, litigating against policies, supporting legislators
✔✔Primary impact of political variables - ✔✔opens or restricts access to markets by
creating or eliminated barriers to entry
✔✔Primary impact of socio-cultural variables - ✔✔impacts what consumers want to buy,
market sizes, and increases management complexity of a diverse workforce.
✔✔Cost structure - ✔✔The types and proportions of expenses a company incurs in its
operations.
✔✔Economies of Scale - ✔✔Cost advantages that a firm gains by increasing its scale of
production.
, ✔✔Economies of Scope - ✔✔Cost advantages that a firm gains by offering a wider
range of products or services.
✔✔Disruptive Innovation - ✔✔An innovation that creates a new market and value
network and eventually disrupts an existing market and value network, displacing
established market-leading firms and products.
✔✔The broadest level of planning - ✔✔strategic planning
✔✔Drives decisions about resource allocation - ✔✔strategic planning
✔✔T or F: Strategic planning primarily involves specific rather than directional goals. -
✔✔False
✔✔Examples of functional planning - ✔✔marketing plans, production plans, supply
chain management plans, and financial plans
✔✔Which type of planning focuses on implementing the SBU's strategies? -
✔✔functional
✔✔Who develops functional plans? - ✔✔senior and middle-level managers
✔✔The most specific and narrow plans - ✔✔Tactical/Operational Planning
✔✔What is the focus of tactical plans? - ✔✔day-to-day execution of functional plans
✔✔Examples of tactical planning - ✔✔production schedules, delivery schedules,
staffing schedules, project work plans, sales call schedules, and operating budgets
✔✔How long are tactical planning horizons? - ✔✔quarterly to hourly
✔✔Who develops tactical plans? - ✔✔lower levels of management and at the team
leader level
✔✔T or F: If lower-level goals are reached, then the higher-level goals are achieved -
✔✔True
✔✔What are the two fundamental and distinct generic business strategies aimed at
achieving competitive advantage? - ✔✔Cost leadership and differentiation
✔✔Cost leadership targets a ___ market. - ✔✔broad
