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MBA 620 Midterm Exam Actual Exam Newest
2025/2026 Complete Questions And Correct Detailed
Answers (Verified Answers) |Brand New Version!!
Agency Problem - SOLUTION=the possibility of conflict of interest
between the owners and management of a firm
A firm operating in a highly competitive industry attempts to win
customers by offering the lowest prices. Which strategy is it pursuing?
A. Differentiation
B. Cost leadership
C. Market penetration
D. Diversification
Answer: B. Cost leadership
Which framework best evaluates external factors such as political,
economic, social, technological, environmental, and legal trends?
A. SWOT
B. PESTEL
C. Value Chain
D. Porter’s Five Forces
Answer: B. PESTEL
Which element of SWOT analysis examines factors like skilled
employees, patents, and brand reputation?
A. Opportunities
B. Weaknesses
C. Strengths
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D. Threats
Answer: C. Strengths
When customers can easily switch to substitutes, which force in Porter’s
Five Forces increases?
A. Supplier power
B. Buyer power
C. Threat of substitutes
D. Industry rivalry
Answer: C. Threat of substitutes
A company acquires its distributor to gain more control over product
delivery. This is an example of:
A. Backward integration
B. Forward integration
C. Horizontal integration
D. Diversification
Answer: B. Forward integration
Which decision-making approach emphasizes optimization under perfect
information?
A. Behavioral model
B. Classical model
C. Incremental model
D. Intuitive model
Answer: B. Classical model
An entrepreneur chooses to focus on a niche market by offering a
specialized product. Which strategy is being used?
A. Cost leadership
B. Broad differentiation
C. Focus strategy
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D. Retrenchment
Answer: C. Focus strategy
In the BCG Growth-Share Matrix, a business unit with high market
share and low growth is considered a:
A. Question mark
B. Star
C. Cash cow
D. Dog
Answer: C. Cash cow
Which financial tool is most appropriate for determining whether a
project generates value after accounting for the cost of capital?
A. Payback period
B. ROI
C. Net Present Value (NPV)
D. Break-even analysis
Answer: C. Net Present Value (NPV)
The concept of “core competencies” was introduced by:
A. Michael Porter
B. Henry Mintzberg
C. Prahalad and Hamel
D. Peter Drucker
Answer: C. Prahalad and Hamel
A company develops different pricing strategies for different customer
groups. This practice is called:
A. Penetration pricing
B. Price skimming
C. Price discrimination
D. Loss-leader pricing
Answer: C. Price discrimination
MBA 620 Midterm Exam Actual Exam Newest
2025/2026 Complete Questions And Correct Detailed
Answers (Verified Answers) |Brand New Version!!
Agency Problem - SOLUTION=the possibility of conflict of interest
between the owners and management of a firm
A firm operating in a highly competitive industry attempts to win
customers by offering the lowest prices. Which strategy is it pursuing?
A. Differentiation
B. Cost leadership
C. Market penetration
D. Diversification
Answer: B. Cost leadership
Which framework best evaluates external factors such as political,
economic, social, technological, environmental, and legal trends?
A. SWOT
B. PESTEL
C. Value Chain
D. Porter’s Five Forces
Answer: B. PESTEL
Which element of SWOT analysis examines factors like skilled
employees, patents, and brand reputation?
A. Opportunities
B. Weaknesses
C. Strengths
,2|Page
D. Threats
Answer: C. Strengths
When customers can easily switch to substitutes, which force in Porter’s
Five Forces increases?
A. Supplier power
B. Buyer power
C. Threat of substitutes
D. Industry rivalry
Answer: C. Threat of substitutes
A company acquires its distributor to gain more control over product
delivery. This is an example of:
A. Backward integration
B. Forward integration
C. Horizontal integration
D. Diversification
Answer: B. Forward integration
Which decision-making approach emphasizes optimization under perfect
information?
A. Behavioral model
B. Classical model
C. Incremental model
D. Intuitive model
Answer: B. Classical model
An entrepreneur chooses to focus on a niche market by offering a
specialized product. Which strategy is being used?
A. Cost leadership
B. Broad differentiation
C. Focus strategy
, 3|Page
D. Retrenchment
Answer: C. Focus strategy
In the BCG Growth-Share Matrix, a business unit with high market
share and low growth is considered a:
A. Question mark
B. Star
C. Cash cow
D. Dog
Answer: C. Cash cow
Which financial tool is most appropriate for determining whether a
project generates value after accounting for the cost of capital?
A. Payback period
B. ROI
C. Net Present Value (NPV)
D. Break-even analysis
Answer: C. Net Present Value (NPV)
The concept of “core competencies” was introduced by:
A. Michael Porter
B. Henry Mintzberg
C. Prahalad and Hamel
D. Peter Drucker
Answer: C. Prahalad and Hamel
A company develops different pricing strategies for different customer
groups. This practice is called:
A. Penetration pricing
B. Price skimming
C. Price discrimination
D. Loss-leader pricing
Answer: C. Price discrimination
