Multiple Choice

Need to understand the reason behind each questions. Please explain.

1. Corporate level decisions are typically made by which of the following
a. Low-level employees
b. The CEO and/or board of directs
c. Functional managers
d. Department heads

2. The higher the entry barriers, the more intense the competition in an industry
a. True
b. False

3. Which of the following may lead a firm to conclude that an industry is attractive to enter?
a. Strong Supplier power
b. Strong customer power
c. No close substitutes
d. Many strong competitors

4. In examining the metal can industry, plastic bottles would be considered which of the following?
a. Suppliers
b. Customer
c. Substitutes
d. Plastic bottles have no bearing on the metal can industry

5. Which of the following is not one of Michael Porter's five forces?
a. Substitutes
b. Complements
c. Existing competitors
d. Potential competitors
e. Supplies

6. Industries may be defined as a group of organizations that compete directly with each other to win orders and sales in the marketplace.
a. True
b. False

7. A mission statement often contains a statement of vision.
a. True
b. False

8. In the breakfast cereal industry, companies such as Kellogg, Quaker Oats, and General Mills sell their cereals to grocery chains, discount stores, and independent grocers. Chain retailers, such as Wal-Mart, Kroger, Safeway, Costco, and Albertson's, purchase the majority of breakfast Cereal. Of there, Wal-Mart accounts for more than 10 percent of cereal sales in the United States. What does this say about the cereal industry?
a. Supplier power is strong in this industry
b. Buyer power is low in this industry
c. Supplier power is low in this industry
d. Buyer power is strong in this industry

9. One important responsibility of the board of directors is to monitor and prevent the potential for agency problems.
a. True
b. False

10. The bowling equipment industry is dominated by two competitors, Brunswick and AMF. What kind of industry structure does this represent?
a. Monopoly
b. Oligopoly
c. Perfect Competition
d. Emerging

11. External stakeholders are groups or individual outside the organization that are significantly influenced by the organization or who have a major impact on the organization.
a. True
b. False

12. The VCR industry is in what stage of its life cycle?
a. Emerging
b. Growing
c. Maturing
d. Declining

13. What of the following is not a major component of social responsibility?
a. Economic responsibility
b. Legal responsibility
c. Political obligations
d. Moral obligations
e. Discretionary responsibility

14. Which of the following is an example of a barrier entry?
a. High fixed costs
b. Brand loyalty
c. Switching costs
d. All of the above

15. Suppliers tend to exhibit greater power if which of the following is true?
a. There are few suppliers of the raw material, product, or service
b. There are many substitute for the product or service that supplies sell
c. Suppliers are small businesses with regards to total sales volume
d. The suppliers' products are undifferentiated and plentiful.

16. Which of the following is not a component of the vertical chain?
a. Supplies
b. Distributions
c. Consumers
d. Substitutes

17. The can-making industry serves three major markets, beverages, food, and general packaging. The beverage industry is the largest market for metal cans, suing more than 100 billion can annually. Of this total, about two thirds are used for nonalcoholic beverages, especially beer. What does this tell you about the can-making industry?
a. Supplier power is strong in this industry
b. Buyer power is low in this industry
c. Supplier power is low in this industry
d. Buyer power is strong in this industry

18. It is important that a firm's strategy fits with its corporate culture.
a. True
b. False

19. Which of the following is the first step in developing a strategic plan?
a. Monitoring day-to-day activities
b. Developing a mission statement
c. Implementation and control
d. Executing the strategy

20. Strategic management includes a process by which organizations analyze and external environments
a. True
b. False

21. The lawn mowing industry is an example of which of the following?
a. Monopoly
b. Oligopoly
c. Perfect competition
d. Substitute

22. The influence of potential competitors on industry competition is determined primarily by which of the following?
a. Buyer power
b. Supplier power
c. Strength of entry barriers
d. Strength of exit barriers
e. Threat of substitutes

23. What is Southwest Airline's relationship to American Airlines?
a. Potential competitor
b. Existing competitor
c. Substitute
d. Indirect competitor

24. If an industry's products are standard and undifferentiated, which of the following results?
a. The industry will have many competitors
b. The industry will have low profits
c. All of the above
d. None of the above

25. The cellular telephone industry is in what state of its lifecycle?
a. Emerging
b. Growing
c. Maturing
d. Declining