Business Strategy Mid-Term: Ch. 1-6 Test And Answers
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Course
Term: Ch. 1-6
Institution
Term: Ch. 1-6
mission, objectives, external & internal analysis, strategic choice, strategy
implementation, and competitive advantage - CORRECT ANSWER-Strategic
Management Process: components in order
Mission - CORRECT ANSWER-Defines the organization's purpose or reason for
existence. Guides each step of ...
Business Strategy Mid-Term: Ch. 1-6
Test And Answers
mission, objectives, external & internal analysis, strategic choice, strategy
implementation, and competitive advantage - CORRECT ANSWER-Strategic
Management Process: components in order
Mission - CORRECT ANSWER-Defines the organization's purpose or reason for
existence. Guides each step of the process.
Objectives - CORRECT ANSWER-concrete and clear in action and/or target. Precise
and measurable.
External Analysis - CORRECT ANSWER-identify environmental opportunities and
threats (SWOT)
internal analysis - CORRECT ANSWER-identify internal strengths and weaknesses
(VRIO)
Strategic choice - CORRECT ANSWER-to gain competitive advantage
Business Level strategy - CORRECT ANSWER-how to achieve competitive advantage
in a particular business.
cost leadership and product differentiation - CORRECT ANSWER-Examples of
business level strategies (2)
corporate level strategy - CORRECT ANSWER-competitive advantage in multiple
markets
diversification, global strategies,merger, strategic alliances, and vertical integration, -
CORRECT ANSWER-Examples of corporate level strategies (5)
Organizational structure, management control systems, and compensation policies -
CORRECT ANSWER-Strategy implementation: How strategies are executed (3)
competitive advantage - CORRECT ANSWER-ability to create more economic value
than competitors
relative, determined in relation to other companies, and customers demonstrate a
preference for the firm's offering. - CORRECT ANSWER-Competitive advantage
characteristics (3)
, strategy - CORRECT ANSWER-firms theory about how to gain competitive advantage
economic value - CORRECT ANSWER-the difference between the perceived benefits
of the product or service and the full economic cost of the product or service
nordstrom vs. wal- mart - CORRECT ANSWER-Example of economic value
EV = perceived benefits - total economic costs - CORRECT ANSWER-Economic value
Formula is__
competitive disadvantage - CORRECT ANSWER-less economic value than
competitors; negative reputation
competitive parity - CORRECT ANSWER-similar economic value as competitors; firm's
offerings are average
CA results in high profit, profits attract competition, competition limits duration of the
competitive advantage, short term and imitable - CORRECT ANSWER-characteristics
of temporary competitive advantage (4)
traditional economic theory and perfect competition - CORRECT ANSWER-When do
you obtain a temporary competitive advantage?
external and internal factors that limit competition i.e. imitation - CORRECT ANSWER-
sustained competitive advantage characteristic
strategic management and imperfect competition - CORRECT ANSWER-When do you
obtain a sustained competitive advantage?
Profitability, Liquidity, Leverage, and Activity - CORRECT ANSWER-Four categories of
Accounting/Economic Ratios
Inventory Turnover, Accounts Receivable Turnover, and Average Collection Period -
CORRECT ANSWER-Activity Ratios (3)
ROA - CORRECT ANSWER-a measure of return on total investment in a firm. Larger is
usually better.
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