BUSI 4940 Exam 2
Simplified Exam Questions with 100% Correct Answers
Focused cost-leadership strategy - same as the cost-leadership strategy except with a narrow
focus on a niche market
focused differentiation strategy - high end with great customer service; serving only one
segment of the overall market and trying to be the most differentiated organization serving that
segment
EX: Louis Vitton
integrated cost leadership/differentiation strategy - "stuck in the middle strategy" that is
proven to fail
Risks of Cost Leadership Strategy - 1. Processes may become obsolete due to competitor
innovations
2. too much cost reductions may communicate poor quality
3. may be able to imitate cost leader's strategy
risks of differentiation - 1. price differentiation may become too large
2. differentiation doesn't provide incremental value for which customers are willing to pay
3. counterfeit goods replicate the features
risks of focus strategies - 1. focusing firm may be "out focused"
2. large competitor may set its sights on the firm's NICHE market
3. customer preferences may change in niche market
reach - a firm's access and connection to customers
, richness - the depth and detail of the 2-way flow of information between the firm and the
customer
affiliation - the facilitation of useful interactions with customers
valuation - the analytical process of determining the current (or projected) worth of an asset
or a company
What is value placed on in an evaluation? - Business's management
Composition of its capital structure
Prospect of future earnings
Market value of its assets
value only exists if it is a _____________ of _________________ - voluntary transaction,
private property
What do you do if no one is willing to buy your product? - -. lower your value expectations
- keep searching for buyers
- stop trying to sell it
Accounting - the cumulative set of rules and processes for recording, analyzing, retrieving,
and reporting financial transactions of a firm
Utility - total satisfaction received from consuming a good or service; the study of human
behavior as it relates to the allocation of limited resources
Simplified Exam Questions with 100% Correct Answers
Focused cost-leadership strategy - same as the cost-leadership strategy except with a narrow
focus on a niche market
focused differentiation strategy - high end with great customer service; serving only one
segment of the overall market and trying to be the most differentiated organization serving that
segment
EX: Louis Vitton
integrated cost leadership/differentiation strategy - "stuck in the middle strategy" that is
proven to fail
Risks of Cost Leadership Strategy - 1. Processes may become obsolete due to competitor
innovations
2. too much cost reductions may communicate poor quality
3. may be able to imitate cost leader's strategy
risks of differentiation - 1. price differentiation may become too large
2. differentiation doesn't provide incremental value for which customers are willing to pay
3. counterfeit goods replicate the features
risks of focus strategies - 1. focusing firm may be "out focused"
2. large competitor may set its sights on the firm's NICHE market
3. customer preferences may change in niche market
reach - a firm's access and connection to customers
, richness - the depth and detail of the 2-way flow of information between the firm and the
customer
affiliation - the facilitation of useful interactions with customers
valuation - the analytical process of determining the current (or projected) worth of an asset
or a company
What is value placed on in an evaluation? - Business's management
Composition of its capital structure
Prospect of future earnings
Market value of its assets
value only exists if it is a _____________ of _________________ - voluntary transaction,
private property
What do you do if no one is willing to buy your product? - -. lower your value expectations
- keep searching for buyers
- stop trying to sell it
Accounting - the cumulative set of rules and processes for recording, analyzing, retrieving,
and reporting financial transactions of a firm
Utility - total satisfaction received from consuming a good or service; the study of human
behavior as it relates to the allocation of limited resources
