WPC 480 FINAL EXAM QUESTIONS AND ANSWERS
If a company wants to gain a competitive advantage in a highly competitive industry, it
should ideally - Answers - stake out a unique position within the industry.
Which of the following stages of the strategic management process involves an
evaluation of a firm's external and internal environments? - Answers - strategy analysis
While creating its AFI strategy framework, Valdez Consultants decided what markets
the firm should compete in. By doing this, what type of strategy did the company
devise? - Answers - corporate strategy
Fuller Apparel's core value statement reads we will ensure our clothing is made with the
highest respect toward human rights and environmental protection. Which of the
following actions exemplifies how Fuller's core values drive its strategic decision
making? - Answers - demanding that textile suppliers pay livable wages and maintain
safe production facilities
A firm always has a competitive disadvantage when its return on invested capital is -
Answers - below the industry average.
________, which is the return on risk capital, includes stock price appreciation plus
dividends received over a specific period. - Answers - Total return to shareholders
Rock Bottom Tiles has developed a new customer-oriented business model. Rather
than maintain a network of showrooms across the country, the business will now let
customers choose several styles that interest them from an online site, and will ship
samples of each of the styles to the customer to test in their home free of charge. Once
they have settled on a tile choice, Rock Bottom will send a representative to their home
to schedule installation. The company has determined that busy middle-class customers
will value the convenience of the new model, which allow them to upgrade the look of
their homes without spending time browsing showrooms. The new model will be created
by selling the old showrooms and shifting resources to the new online site and regional
offices for sales personnel. What question remains for Rock Bottom to ask in order to
put its strategy into action? - Answers - What activities need to be performed to create
and deliver the offerings to consumers?
Aguilar Industries has produced a new piece of technology that will monitor the soil
moisture in a user's garden and send a notification to an app on the user's phone when
it is time to water their plants. The goal of this inexpensive technology is to entice users
to purchase Aguilar's more expensive automated watering system, so that they can
trigger the watering process from the app on their phones. Which business model is
most likely to help Aguilar Industries accomplish its goals? - Answers - freemium
, The working capital turnover of Tesva Systems Corp. is 6.0. What does this financial
data suggest? - Answers - For every dollar Tesva Systems puts to work, the company
realizes $6.00 of sales.
The market capitalization of a public company is $5 billion. Each share of the company
is traded at $200. What do you infer from this financial data? - Answers - The firm's
number of outstanding shares is 25 million.
Petra's Programming competes on cost with WonderWeb in the web design industry.
Both firms operate on a 90 percent learning curve, and neither firm is capable of
increasing its cumulative output any further. How might Petra's Programming achieve a
cost leadership position while maintaining customer satisfaction? - Answers - by
incorporating new programming techniques to take advantage of experience curve
effects
When a differentiator charges a similar price as its competitors in the same strategic
group but offers more perceived value, it - Answers - gains market share from other
firms.
Heirloom Furniture is a brand reputed for its wide variants of sofas that introduced a
new range of mattresses and bed frames a few years ago. Since most of its products
could be produced using the same resources and technology, the company's cost
structure lowered, while its product portfolio widened. In this scenario, which of the
following value and cost drivers is Heirloom applying? - Answers - economies of scope
Gilroy Crackers enjoys a competitive advantage as a cost leader because high demand
for its products has allowed it to operate at the minimum efficient scale. Which of the
following scenarios would be most concerning to the managers of Gilroy Crackers? -
Answers - A major winter storm shuts down Gilroy's production for several days.
Which of the following is primarily a value driver? - Answers - complements
Which of the following is a primary feature of the five forces model? - Answers - It views
competition within an industry broadly to include forces such as buyers, suppliers, and
the threat of substitutes.
Bryan is a manager at a software firm. The CEO tells him that the industry as a whole
has become increasingly profitable over the past five years. Based on this information,
Bryan is most likely to expect - Answers - increased competition in the future and
therefore he should recommend that the company upgrade its products to slow the
entry of rival companies.
Golden Harvest is a restaurant located inside a five-star hotel. It caters mainly to
customers who are concerned about quality dining rather than the prices. In this
scenario, which of the following will be a part of Golden Harvest's strategic group? -
Answers - a premium rooftop restaurant in the same city
If a company wants to gain a competitive advantage in a highly competitive industry, it
should ideally - Answers - stake out a unique position within the industry.
Which of the following stages of the strategic management process involves an
evaluation of a firm's external and internal environments? - Answers - strategy analysis
While creating its AFI strategy framework, Valdez Consultants decided what markets
the firm should compete in. By doing this, what type of strategy did the company
devise? - Answers - corporate strategy
Fuller Apparel's core value statement reads we will ensure our clothing is made with the
highest respect toward human rights and environmental protection. Which of the
following actions exemplifies how Fuller's core values drive its strategic decision
making? - Answers - demanding that textile suppliers pay livable wages and maintain
safe production facilities
A firm always has a competitive disadvantage when its return on invested capital is -
Answers - below the industry average.
________, which is the return on risk capital, includes stock price appreciation plus
dividends received over a specific period. - Answers - Total return to shareholders
Rock Bottom Tiles has developed a new customer-oriented business model. Rather
than maintain a network of showrooms across the country, the business will now let
customers choose several styles that interest them from an online site, and will ship
samples of each of the styles to the customer to test in their home free of charge. Once
they have settled on a tile choice, Rock Bottom will send a representative to their home
to schedule installation. The company has determined that busy middle-class customers
will value the convenience of the new model, which allow them to upgrade the look of
their homes without spending time browsing showrooms. The new model will be created
by selling the old showrooms and shifting resources to the new online site and regional
offices for sales personnel. What question remains for Rock Bottom to ask in order to
put its strategy into action? - Answers - What activities need to be performed to create
and deliver the offerings to consumers?
Aguilar Industries has produced a new piece of technology that will monitor the soil
moisture in a user's garden and send a notification to an app on the user's phone when
it is time to water their plants. The goal of this inexpensive technology is to entice users
to purchase Aguilar's more expensive automated watering system, so that they can
trigger the watering process from the app on their phones. Which business model is
most likely to help Aguilar Industries accomplish its goals? - Answers - freemium
, The working capital turnover of Tesva Systems Corp. is 6.0. What does this financial
data suggest? - Answers - For every dollar Tesva Systems puts to work, the company
realizes $6.00 of sales.
The market capitalization of a public company is $5 billion. Each share of the company
is traded at $200. What do you infer from this financial data? - Answers - The firm's
number of outstanding shares is 25 million.
Petra's Programming competes on cost with WonderWeb in the web design industry.
Both firms operate on a 90 percent learning curve, and neither firm is capable of
increasing its cumulative output any further. How might Petra's Programming achieve a
cost leadership position while maintaining customer satisfaction? - Answers - by
incorporating new programming techniques to take advantage of experience curve
effects
When a differentiator charges a similar price as its competitors in the same strategic
group but offers more perceived value, it - Answers - gains market share from other
firms.
Heirloom Furniture is a brand reputed for its wide variants of sofas that introduced a
new range of mattresses and bed frames a few years ago. Since most of its products
could be produced using the same resources and technology, the company's cost
structure lowered, while its product portfolio widened. In this scenario, which of the
following value and cost drivers is Heirloom applying? - Answers - economies of scope
Gilroy Crackers enjoys a competitive advantage as a cost leader because high demand
for its products has allowed it to operate at the minimum efficient scale. Which of the
following scenarios would be most concerning to the managers of Gilroy Crackers? -
Answers - A major winter storm shuts down Gilroy's production for several days.
Which of the following is primarily a value driver? - Answers - complements
Which of the following is a primary feature of the five forces model? - Answers - It views
competition within an industry broadly to include forces such as buyers, suppliers, and
the threat of substitutes.
Bryan is a manager at a software firm. The CEO tells him that the industry as a whole
has become increasingly profitable over the past five years. Based on this information,
Bryan is most likely to expect - Answers - increased competition in the future and
therefore he should recommend that the company upgrade its products to slow the
entry of rival companies.
Golden Harvest is a restaurant located inside a five-star hotel. It caters mainly to
customers who are concerned about quality dining rather than the prices. In this
scenario, which of the following will be a part of Golden Harvest's strategic group? -
Answers - a premium rooftop restaurant in the same city
