SEVI 3013 (WELSH) EXAM/ACTUAL EXAM QUESTIONS AND ANSWERS
PLUS RATIONALES/NEWEST UPDATE 2026
1. A firm develops an integrated and coordinated set of commitments and
actions designed to exploit its core competencies and achieve competitive
advantage over rivals. Which concept best describes this managerial
approach?
A. Organizational structure
B. Strategy
C. Tactical budgeting
D. Operational control
Answer: B
2. Senior executives are deciding which industries and markets their
corporation should compete in, rather than determining how one particular
business unit should compete. Which level of strategy is primarily being
addressed?
A. Functional strategy
B. Business-level strategy
C. Corporate strategy
D. Operational strategy
Answer: C
3. A business unit has already selected its industry and now must determine
how it will position itself against competitors by choosing between
approaches such as cost leadership and differentiation. Which strategic
question is being addressed?
A. How should the firm compete within its chosen industry?
B. Which countries should be eliminated from the corporation?
C. How should accounting procedures be standardized?
D. Which employees should receive promotions?
Answer: A
pg. 1
, 4. Investors receive returns that exceed what they expect from alternative
investments with a similar level of risk. Which term describes this outcome?
A. Competitive parity
B. Economic decline
C. Above-average returns
D. Operational efficiency
Answer: C
5. A firm's leaders identify specialized knowledge, skills, and organizational
capabilities that competitors find difficult to duplicate and that allow the
firm to differentiate itself. What are these strategically important
capabilities called?
A. Core competencies
B. Switching costs
C. Industry barriers
D. External controls
Answer: A
6. A manager explains that the firm's performance is strongly influenced by
the characteristics of the industry in which it competes and that managers
should select an attractive industry and position the firm appropriately.
Which strategic management model is being described?
A. Resource-based model
B. I/O model
C. Behavioral model
D. Stakeholder model
Answer: B
7. A company believes that its unique resources, capabilities, and
competencies are the primary foundation of its competitive advantage.
Which perspective does this belief most closely represent?
A. Industrial organization model
B. Population ecology model
C. Resource-based model
pg. 2
, D. Transaction-cost model
Answer: C
8. A strategic manager evaluates customers, competitors, suppliers, and other
groups that can influence the organization's ability to achieve its objectives.
Which concept is most directly involved?
A. Stakeholder analysis
B. Vertical integration
C. Organizational downsizing
D. Financial auditing
Answer: A
9. A company has developed a valuable proprietary technology, but
competitors can easily purchase an equivalent technology from suppliers.
Which characteristic of a resource is most clearly missing if the firm wants
the resource to provide a sustained competitive advantage?
A. Value
B. Rarity
C. Imitability
D. Organizational support
Answer: B
10. A company owns a resource that is valuable, rare, difficult to imitate, and
fully supported by its organizational systems. According to the VRIO
framework, what type of strategic implication is most appropriate?
A. Competitive disadvantage
B. Temporary competitive parity
C. Sustained competitive advantage
D. Strategic irrelevance
Answer: C
11. A firm's managers examine population trends, age distributions, geographic
shifts, and changes in household composition because these factors may
alter future demand. Which segment of the general environment are they
evaluating?
pg. 3
, A. Economic
B. Demographic
C. Technological
D. Political/legal
Answer: B
12. A company monitors inflation, interest rates, unemployment, gross
domestic product, and consumer purchasing power when developing its
strategy. Which external-environment segment is being analyzed?
A. Economic
B. Sociocultural
C. Global
D. Technological
Answer: A
13. A multinational organization examines taxation laws, antitrust regulations,
labor legislation, and government policies before entering a foreign market.
Which environmental segment is most relevant?
A. Demographic
B. Political/legal
C. Sociocultural
D. Sustainable physical
Answer: B
14. A company notices increasing demand for environmentally sustainable
products and changing attitudes toward workforce diversity and lifestyle
preferences. Which broad environmental segment is most directly involved?
A. Economic
B. Technological
C. Sociocultural
D. Demographic
Answer: C
15. A firm evaluates artificial intelligence, automation, research and
development, digital platforms, and the speed with which innovations
pg. 4
PLUS RATIONALES/NEWEST UPDATE 2026
1. A firm develops an integrated and coordinated set of commitments and
actions designed to exploit its core competencies and achieve competitive
advantage over rivals. Which concept best describes this managerial
approach?
A. Organizational structure
B. Strategy
C. Tactical budgeting
D. Operational control
Answer: B
2. Senior executives are deciding which industries and markets their
corporation should compete in, rather than determining how one particular
business unit should compete. Which level of strategy is primarily being
addressed?
A. Functional strategy
B. Business-level strategy
C. Corporate strategy
D. Operational strategy
Answer: C
3. A business unit has already selected its industry and now must determine
how it will position itself against competitors by choosing between
approaches such as cost leadership and differentiation. Which strategic
question is being addressed?
A. How should the firm compete within its chosen industry?
B. Which countries should be eliminated from the corporation?
C. How should accounting procedures be standardized?
D. Which employees should receive promotions?
Answer: A
pg. 1
, 4. Investors receive returns that exceed what they expect from alternative
investments with a similar level of risk. Which term describes this outcome?
A. Competitive parity
B. Economic decline
C. Above-average returns
D. Operational efficiency
Answer: C
5. A firm's leaders identify specialized knowledge, skills, and organizational
capabilities that competitors find difficult to duplicate and that allow the
firm to differentiate itself. What are these strategically important
capabilities called?
A. Core competencies
B. Switching costs
C. Industry barriers
D. External controls
Answer: A
6. A manager explains that the firm's performance is strongly influenced by
the characteristics of the industry in which it competes and that managers
should select an attractive industry and position the firm appropriately.
Which strategic management model is being described?
A. Resource-based model
B. I/O model
C. Behavioral model
D. Stakeholder model
Answer: B
7. A company believes that its unique resources, capabilities, and
competencies are the primary foundation of its competitive advantage.
Which perspective does this belief most closely represent?
A. Industrial organization model
B. Population ecology model
C. Resource-based model
pg. 2
, D. Transaction-cost model
Answer: C
8. A strategic manager evaluates customers, competitors, suppliers, and other
groups that can influence the organization's ability to achieve its objectives.
Which concept is most directly involved?
A. Stakeholder analysis
B. Vertical integration
C. Organizational downsizing
D. Financial auditing
Answer: A
9. A company has developed a valuable proprietary technology, but
competitors can easily purchase an equivalent technology from suppliers.
Which characteristic of a resource is most clearly missing if the firm wants
the resource to provide a sustained competitive advantage?
A. Value
B. Rarity
C. Imitability
D. Organizational support
Answer: B
10. A company owns a resource that is valuable, rare, difficult to imitate, and
fully supported by its organizational systems. According to the VRIO
framework, what type of strategic implication is most appropriate?
A. Competitive disadvantage
B. Temporary competitive parity
C. Sustained competitive advantage
D. Strategic irrelevance
Answer: C
11. A firm's managers examine population trends, age distributions, geographic
shifts, and changes in household composition because these factors may
alter future demand. Which segment of the general environment are they
evaluating?
pg. 3
, A. Economic
B. Demographic
C. Technological
D. Political/legal
Answer: B
12. A company monitors inflation, interest rates, unemployment, gross
domestic product, and consumer purchasing power when developing its
strategy. Which external-environment segment is being analyzed?
A. Economic
B. Sociocultural
C. Global
D. Technological
Answer: A
13. A multinational organization examines taxation laws, antitrust regulations,
labor legislation, and government policies before entering a foreign market.
Which environmental segment is most relevant?
A. Demographic
B. Political/legal
C. Sociocultural
D. Sustainable physical
Answer: B
14. A company notices increasing demand for environmentally sustainable
products and changing attitudes toward workforce diversity and lifestyle
preferences. Which broad environmental segment is most directly involved?
A. Economic
B. Technological
C. Sociocultural
D. Demographic
Answer: C
15. A firm evaluates artificial intelligence, automation, research and
development, digital platforms, and the speed with which innovations
pg. 4
