CAPSIM Exam 1 UPDATED ACTUAL
Exam Questions and CORRECT Answers
What are the Porter's five forces - CORRECT ANSWER - degree of rivalry,
power of suppliers,
power of buyers,
threat of substitutes,
threat of new entrants
Explain the relationship between each force and industry profitability - CORRECT
ANSWER - As the force increases, industry profitability decreases
What is the relationship between slow industry growth and the intensity of rivalry among
competitor - CORRECT ANSWER - As the industry growth slows down, the intensity of
rivalry goes up
What are strategic groups - CORRECT ANSWER - Set of firms emphasizing similar
strategic dimensions to use a similar strategy
Would the competition within same strategic group be intensified or weakened? - CORRECT
ANSWER - Intensifies
Tangible Resources - CORRECT ANSWER - resources that have physical attributes and
thus are visible
Ex. of Tangible resources - CORRECT ANSWER - Financial Assets/Cash
Physical Assets
Land
Human Resources/People
Organizational Structure
, Intangible Resource - CORRECT ANSWER - abstract resources
Ex. of Tangible resources - CORRECT ANSWER - Technology
Innovativeness
Reputation/Goodwill
Brand Equity
Knowledge/Ideas
What are the four criteria of sustainable competitive advantage - CORRECT ANSWER -
Valuable, rare, costly-to-imitate, non-substitutable
What are the primary activities - CORRECT ANSWER - Activities involved in the
physical creation of the product, its marketing and deliveryto consumers, and after-sales service
and suppor
what are the support activities - CORRECT ANSWER - Activities which provide the
inputs that allow the primary activities to take place
Suppliers are powerful when:
A. satisfactory substitutes of suppliers are available.
B. they sell a commodity product.
C. they have credible threat of forward integration.
D. they are in a highly fragmented (not concentrated) industry - CORRECT ANSWER - C.
9. Customers tend to exhibit a powerful force on competition in the industry if:
A. There are a large number of customers that buy the product
B. The customers make low volume purchase
Exam Questions and CORRECT Answers
What are the Porter's five forces - CORRECT ANSWER - degree of rivalry,
power of suppliers,
power of buyers,
threat of substitutes,
threat of new entrants
Explain the relationship between each force and industry profitability - CORRECT
ANSWER - As the force increases, industry profitability decreases
What is the relationship between slow industry growth and the intensity of rivalry among
competitor - CORRECT ANSWER - As the industry growth slows down, the intensity of
rivalry goes up
What are strategic groups - CORRECT ANSWER - Set of firms emphasizing similar
strategic dimensions to use a similar strategy
Would the competition within same strategic group be intensified or weakened? - CORRECT
ANSWER - Intensifies
Tangible Resources - CORRECT ANSWER - resources that have physical attributes and
thus are visible
Ex. of Tangible resources - CORRECT ANSWER - Financial Assets/Cash
Physical Assets
Land
Human Resources/People
Organizational Structure
, Intangible Resource - CORRECT ANSWER - abstract resources
Ex. of Tangible resources - CORRECT ANSWER - Technology
Innovativeness
Reputation/Goodwill
Brand Equity
Knowledge/Ideas
What are the four criteria of sustainable competitive advantage - CORRECT ANSWER -
Valuable, rare, costly-to-imitate, non-substitutable
What are the primary activities - CORRECT ANSWER - Activities involved in the
physical creation of the product, its marketing and deliveryto consumers, and after-sales service
and suppor
what are the support activities - CORRECT ANSWER - Activities which provide the
inputs that allow the primary activities to take place
Suppliers are powerful when:
A. satisfactory substitutes of suppliers are available.
B. they sell a commodity product.
C. they have credible threat of forward integration.
D. they are in a highly fragmented (not concentrated) industry - CORRECT ANSWER - C.
9. Customers tend to exhibit a powerful force on competition in the industry if:
A. There are a large number of customers that buy the product
B. The customers make low volume purchase
