Chapter 6-Strategic Management (CAP) UPDATED ACTUAL Questions and
CORRECT Answers
An organization's present strategies, objectives and True
mission, coupled with the external and internal audit
information, provide a basis for generating and evaluating
feasible alternative strategies.
Alternative strategies don't come out of the blue; they True
are derived from the firm's vision, mission, and objectives.
It is vital that strategists always consider all feasible False
alternatives that could benefit the firm.
The first stage of the strategy-formulation framework is False
the input stage, and it is directly followed by the decision
stage.
Stage 2 in the strategy-formulation framework involves False
the Quantitative Strategic Planning Matrix.
The Strengths-Weaknesses-Opportunities-Threats True
(SWOT) Matrix, the Strategic Position and Action
Evaluation (SPACE) Matrix, the Boston Consulting Group
(BCG) Matrix, the Internal-External (IE) Matrix, and the
Grand Strategy Matrix are included in stage two of the
strategy-formulation framework.
Good intuitive judgment is always needed to determine True
appropriate weights and ratings in the input stage
matrices.
When completing the matching stage of the strategy- False
formulation framework, the SWOT Matrix needs to be
completed before the SPACE Matrix.
The purpose of matching key factors is to generate True
feasible alternative strategies.
Strengths-opportunities strategies are based on using a True
firm's internal strengths to take advantage of external
opportunities.
A SWOT Matrix is composed of four cells for the four False
types of strategies it creates.
, One of the steps of the SWOT Matrix is to list the firm's True
key external opportunities.
The SWOT matrix, if used appropriately, does not have False
any limitations.
The most important determinants of an organization's True
overall strategic position are considered to be the two
internal dimensions, financial position (FP) and
competitive position (CP), and the two external
dimensions, industry position (IP) and stability position
(SP).
The four strategies of the SPACE Matrix are aggressive, False
conservative, offensive and defensive.
Market penetration can be classified as either a True
conservative, aggressive, or competitive strategy.
The SP and CP dimension variables in a SPACE Matrix are True
assigned a numerical value ranging from -1 (best) to -7
(worst).
Conservative strategies in a SPACE Matrix most often True
include product development, market development,
market penetration, and related diversification.
The firm should pursue conservative strategies if the True
coordinates of a SPACE directional vector are (-1, +4).
A firm should pursue defensive strategies if the False
coordinates of a SPACE directional vector are (+2, +3).
The firm should pursue aggressive strategies if the True
coordinates of a SPACE directional vector are (+5, +4).
Relative market share position is given on the x-axis of True
the BCG Matrix.
The midpoint on the x-axis of a BCG Matrix is typically set False
at 0.05.
The size of the circle in a BCG Matrix corresponds to the True
proportion of corporate revenue generated by that
business unit.
In a BCG Matrix the pie slice indicates the proportion of True
corporate profits generated by that division.
Stars, Question Marks, Cash Cows, and Dogs are the four True
quadrants exhibited by the BCG Matrix.
CORRECT Answers
An organization's present strategies, objectives and True
mission, coupled with the external and internal audit
information, provide a basis for generating and evaluating
feasible alternative strategies.
Alternative strategies don't come out of the blue; they True
are derived from the firm's vision, mission, and objectives.
It is vital that strategists always consider all feasible False
alternatives that could benefit the firm.
The first stage of the strategy-formulation framework is False
the input stage, and it is directly followed by the decision
stage.
Stage 2 in the strategy-formulation framework involves False
the Quantitative Strategic Planning Matrix.
The Strengths-Weaknesses-Opportunities-Threats True
(SWOT) Matrix, the Strategic Position and Action
Evaluation (SPACE) Matrix, the Boston Consulting Group
(BCG) Matrix, the Internal-External (IE) Matrix, and the
Grand Strategy Matrix are included in stage two of the
strategy-formulation framework.
Good intuitive judgment is always needed to determine True
appropriate weights and ratings in the input stage
matrices.
When completing the matching stage of the strategy- False
formulation framework, the SWOT Matrix needs to be
completed before the SPACE Matrix.
The purpose of matching key factors is to generate True
feasible alternative strategies.
Strengths-opportunities strategies are based on using a True
firm's internal strengths to take advantage of external
opportunities.
A SWOT Matrix is composed of four cells for the four False
types of strategies it creates.
, One of the steps of the SWOT Matrix is to list the firm's True
key external opportunities.
The SWOT matrix, if used appropriately, does not have False
any limitations.
The most important determinants of an organization's True
overall strategic position are considered to be the two
internal dimensions, financial position (FP) and
competitive position (CP), and the two external
dimensions, industry position (IP) and stability position
(SP).
The four strategies of the SPACE Matrix are aggressive, False
conservative, offensive and defensive.
Market penetration can be classified as either a True
conservative, aggressive, or competitive strategy.
The SP and CP dimension variables in a SPACE Matrix are True
assigned a numerical value ranging from -1 (best) to -7
(worst).
Conservative strategies in a SPACE Matrix most often True
include product development, market development,
market penetration, and related diversification.
The firm should pursue conservative strategies if the True
coordinates of a SPACE directional vector are (-1, +4).
A firm should pursue defensive strategies if the False
coordinates of a SPACE directional vector are (+2, +3).
The firm should pursue aggressive strategies if the True
coordinates of a SPACE directional vector are (+5, +4).
Relative market share position is given on the x-axis of True
the BCG Matrix.
The midpoint on the x-axis of a BCG Matrix is typically set False
at 0.05.
The size of the circle in a BCG Matrix corresponds to the True
proportion of corporate revenue generated by that
business unit.
In a BCG Matrix the pie slice indicates the proportion of True
corporate profits generated by that division.
Stars, Question Marks, Cash Cows, and Dogs are the four True
quadrants exhibited by the BCG Matrix.
