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The perfectly competitive industry structure differs from the resource-based model in its view that:


A) all firms have access to the same resources.
B) accessibility to bundles of resources differ across firms.
C) resources tend to be "sticky."
D) competencies differ across firms working in the same industry.

E) A) and C)
F) A) and D)

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Which of the following resources is a firm's resource stock?


A) Cash at bank
B) Reputation for quality
C) Land and building
D) Plant and machinery

E) All of the above
F) None of the above

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BioTree Inc.has used $350,000, from its total annual earnings of $1,250,000, to invest in the research and development of a multi-purpose vaccine.Its account receivable from customers is estimated to be $150,000 and accounts payable $80,000.In monetary terms, what would BioTree Inc.'s resource flows be?


A) $1,250,000
B) $150,000
C) $80,000
D) $350,000

E) None of the above
F) B) and D)

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How do managers use the SWOT matrix to develop strategic alternative?

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Managers use the SWOT matrix to develop ...

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True Home Inc., Super Cart Inc., and Daily Things Inc.are three consumer-product retailing companies.Their products consist primarily of day-to-day items that are easy to imitate and sell.All three companies use the same resources and capabilities in the production and distribution of their products.Which of the following is an implication of the market condition indicated in this scenario?


A) Resource immobility of the firms will be low.
B) The industry structure will be far from perfect competition.
C) Barriers to entry within the industry will be high.
D) Any advantage that one firm has will be short-lived.

E) A) and C)
F) B) and D)

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Talk Age Inc., a telecommunication company, had been drastically losing its market share due to tough competition in the industry.The management hired a reputed consulting firm to advice the company.The experts from the consulting firm pointed out that the company primarily lost out on its competitive advantage due to its tedious internal policies and procedures.These ineffective policies and procedures made the company operations, marketing, and after sales service inefficient.Talk Age Inc.can best solve its problem by working on its _____.


A) immobile assets
B) support activities
C) resource flows
D) resource stocks

E) B) and C)
F) A) and C)

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A firm's resources and capabilities are costly to imitate.This is because rival companies do not clearly understand the relationship between the resources and capabilities controlled by the firm.In this case, the firm's competitive advantage is protected against imitation by _____.


A) path dependence
B) dependence complexity
C) causal ambiguity
D) social complexity

E) None of the above
F) A) and B)

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Connect Plus Cellular is a leading mobile network operator.Since most of the resources used by Connect Plus Cellular is easily available, the company's brand name is the only resource that distinguishes it from the other operators.No other competitor in the industry has a strong brand name like that of Connect Plus Cellular.This unique asset that has helped the company gain a competitive advantage will be considered as a(n) _____ resource in the VRIO framework.


A) tangible
B) mobile
C) imperishable
D) rare

E) None of the above
F) A) and B)

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Which of the following is a drawback of the SWOT analysis?


A) The SWOT analysis takes into account only the internal environment of a firm, ignoring the equally important external environment.
B) This framework is only applicable to the manufacturing industries; it is ineffective when applied to the service firms.
C) A problem with this framework is that a strength can also be a weakness, and that an opportunity can also simultaneously be a threat.
D) A drawback of this framework is that it allows managers to merely evaluate a firm's current situation, and not its future prospects.

E) A) and B)
F) C) and D)

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Intangible assets add great value to a firm primarily because the firm's:


A) reputation and brand equity are accumulated quickly and can be leveraged easily.
B) knowledge and culture take time to develop and are generally difficult to imitate.
C) tangible assets require a higher degree of capital than its intangible assets.
D) capabilities are by nature typically tangible.

E) A) and D)
F) None of the above

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Maroon Inc.is a leading international apparel company.Competitors across the globe have failed to imitate Maroon Inc.'s production models, supply chain systems, knowledge systems, and culture.These attributes have remained unique to Maroon Inc.for a long time.Which of the following assumptions of the resource-based model of competitive advantage does this scenario best illustrate?


A) Resource homogeneity
B) Resource perishability
C) Resource equality
D) Resource immobility

E) A) and C)
F) All of the above

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Which of the following statements fails to bring out the essence of the dynamic capabilities perspective?


A) A firm's competitive advantage is derived from static resource or market advantages.
B) A firm must be able to change its resource base as the external environment changes in order to sustain its competitive advantage.
C) A firm should modify its core competencies to effectively compete in dynamic markets.
D) A firm's external environment is rarely stable, and in many industries, change is fast and ferocious.

E) None of the above
F) B) and C)

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In a generic value chain, a firm's after-sales service will be referred to as its _____.


A) primary activity
B) support activity
C) static resource
D) resource flow

E) All of the above
F) B) and D)

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_____ describes a process in which the options one faces in a current situation are limited by decisions made in the past.


A) Social complexity
B) Path dependence
C) Cannibalization
D) Causal ambiguity

E) A) and B)
F) None of the above

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How does causal ambiguity act as a barrier against imitation of a firm's valuable resources?

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Causal ambiguity describes a situation i...

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The competitive advantage that one firm has will be short-lived in an industry where:


A) resource immobility is high.
B) perfect competition exists.
C) resource heterogeneity is high.
D) capabilities of a firm are not easily replicable.

E) B) and C)
F) A) and D)

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In the context of the VRIO Framework, what does a valuable resource mean?

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A resource is valuable if it helps a fir...

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In the context of SWOT analysis, which of the following best exemplifies a firm's external opportunity?


A) An increase in its financial resources
B) An increase in its brand equity
C) An increase in its customers' disposable income
D) An increase in its employee productivity

E) B) and C)
F) None of the above

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The management of a company is assessing the value of all the tangible resources the company owns.Which of the following will be included in this assessment?


A) The company's copyrights
B) The company's brand equity
C) The company's patents
D) The company's machinery

E) A) and B)
F) All of the above

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In the context of the resource-based model of competitive advantage, which of the following scenarios best exemplifies resource immobility?


A) AP Corp. has earned a good reputation among its shareholders by investing more in tangible assets over intangible assets.
B) Two Triangle Inc. has lost its market share because its resources are not mobile, that is rigid, inflexible, and static.
C) Blue Elixir Corp. has been able to gain a competitive advantage because of its ability to efficiently move its resources from one manufacturing unit to another.
D) True 3 Inc. has been able to outperform its competitors because the uniqueness of its resources is difficult to replicate.

E) A) and B)
F) B) and C)

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