Complete Test Bank Strategic Management Concepts Competitiveness and Globalization 12th Edition Hitt Questions & Answers with rationales (Chapter 1-13)

Strategic Management Concepts Competitiveness and Globalization 12th Edition Hitt Test Bank Chapter 01 Strategic Management and Strategic Competitiveness TRUEFALSE 1. Strategic competitiveness is achieved when a firm successfully formulates and implements a value -creating strategy. (A) True (B) False Answer : (A) 2. Alligator Enterprises has earned above -average returns since its founding five years ago. No other firm has challenged Alligator in its particular market niche; therefore, the firm's owners can feel secure that Alligator has established a competitive advantage. (A) True (B) False Answer : (B) 3. The goal of strategy implementation is to develop a permanent competitive advantage. (A) True (B) False Answer : (B) 4. Risk in terms of financial returns reflects an investor's uncertainty about economic gains or losses that will result from a particular investment. (A) True (B) False Answer : (A) 5. Average returns are those in excess of what an investor expects to earn from other investments with a similar amount of risk. (A) True (B) False Answer : (B) 6. Above average returns are those in excess of what an investor expects to earn from other investments with similar stock prices. (A) True (B) False Answer : (A) 7. Returns can only be measured in accounting terms such as return on assets, return on equity, or return on sales. (A) True (B) False Answer : (B) 8. To implement a firm's strategies, the firm takes actions to with the goal of achieving strategic competitiveness and above average returns. (A) True (B) False Answer : (A) 9. Economies of scale and huge advertising budgets are just as effective in the new competitive landscape as they were in the past. (A) True (B) False Answer : (B) 10. The two primary drivers of hypercompetition are the emergence of the global economy and technology. (A) True (B) False Answer : (A) 11. The rate of technology diffusion has been steadily increasing over the last two decades. (A) True (B) False Answer : (A) 12. While patents may be an effective way of protecting proprietary technology, many firms competing in the electronics industry do not apply for patents to prevent competitors from utilizing the technological knowledge that would be included in the patent application. (A) True (B) False Answer : (A) 13. Examples of incremental innovations include iPods, PDAs, Wi-Fi, and web browser software. (A) True (B) False Answer : (B) 14. The rapid rate of technological diffusion has increased the competitive benefits of patents. (A) True (B) False Answer : (B) 15. Developed countries still have major advantages in their access to information technology when compared to emerging economies because of the significant cost of the infrastructure needed for computing power. (A) True (B) False Answer : (B) 16. The rate of growth of Internet -based applications could be affected by strategies of Internet service providers charging users for downloading those applications. (A) True (B) False Answer : (A) 17. The new CEO of Opacity Enterprises is determined to make the long -established firm strategically flexible. The CEO feels that the employees of the company have the ability, training, and resources to engage in continuous learning. The CEO must encourage ambidextrous learning, absorbing new knowledge and building incremental knowledge. (A) True (B) False Answer : (A) 18. The I/O (industrial organization) model assumes that the uniqueness of a firm's resources and capabilities is the main source of above -average returns. (A) True (B) False Answer : (B) 19. The CEO of Twin Spires, Inc., is committed to using the expertise and resources currently in the firm to serve the needs of the natural gardening community by providing rare and native plants to individuals and nurseries around the United States. The perspective of the CEO of Twin Spires is consistent with the assumptions of the industrial organization (I/O) model. (A) True (B) False Answer : (B) 20. The five forces model suggests that firms should target the industry with the highest potential for above -average returns and then implement either a cost -leadership strategy or a differentiation strategy. (A) True (B) False Answer : (A) 21. The uniqueness of a firm's resources and capabilities is the basis for a firm's strategy and determines its ability to earn above -average returns under the I/O view. (A) True (B) False