WPC 480 EXAM QUESTIONS AND ANSWERS
LATEST UPDATE (ALREADY GRADED A+)
Mainline Ltd. is a landline telephone manufacturer whose average return on invested capital is
approximately 2 percent. Because demand for landline telephones has declined significantly, the
industry average return on invested capital has been negative (-5 percent) for the last few years. In
this scenario, Mainline Ltd. has a
competitive advantage.
A positive relationship between vision statements and firm performance is more likely to exist when
organizational structures are aligned with the firm's vision statement.
Visionary companies are able to outperform their competitors because
they provide more aspirational visions.
Managers use the AFI strategy framework to
explain and predict differences in firm performance.
When do employees fail to adopt the organizational values of a firm?
when the top managers in the firm are merely paying lip service to the firm's stated values
Strategic leadership pertains to the use of power and influence by ________ to direct the activities of
others when pursuing an organization's goals.
corporate executives
The amount of xylene that can be used in household paint is legally limited to 0.03 percent. Anything
beyond this amount is hazardous to health and the environment, and considered a legal offense.
Consequently, CW Paints Corp. has vouched to make its products as safe as possible. Therefore, it
manufactures xylene-free paints even though this increases its costs and reduces the dividends paid
to its shareholders in the long run. Which of the following responsibilities is CW Paints Corp. primarily
compromising in this scenario?
economic responsibilities toward its shareholders
The distribution department at Golden Grains Wheat Company has decided to adopt the FIFO (first in,
first out) method of inventory to dispatch its bags of wheat. Which of the following strategies does
this scenario best illustrate?
functional strategy
A company uses the planned emergence approach in the development of its strategies. Which of the
following is an implication of this?
, The company's organizational structure and systems will be designed to support bottom-up strategic
initiatives.
As a part of strategy formulation, a firm's functional strategy primarily concerns questions relating to
how to implement business strategy.
Which of the following factors most contributes to the U.S. automotive industry being characterized
by high entry barriers?
Car manufacturers require large-scale production in order to be cost-competitive.
Given the structure of the automobile industry, entering the auto manufacturing industry seemed
risky. Yet Tesla Motors joined the fray. Rather than attempting to compete head-on with internal
combustion engines, Tesla Motors entered the all-electric car segment, a much less crowded niche in
the overall car industry. Which of the following is Tesla most hoping to benefit from in this market
niche?
economies of scale
Which of the following features about a buyer indicates that the buyer has high bargaining power?
when the buyer operates in an industry where products are undifferentiated
Pure Carat Inc. is a company that sells 24-carat gold biscuits to companies that manufacture jewelry.
Since the company operates in an industry where many other suppliers sell standardized products, it
can most likely
only achieve competitive parity.
Zoom Zoom Car Rental follows a cost-leadership strategy. Which of the following firms will most likely
be its direct competitor?
Reliable Rental Cars, which follows a low-cost strategy
How does causal ambiguity act as an isolating mechanism for organizations?
It makes it difficult for the competitors to understand why a company has been so successful.
Competitors have found it extremely difficult to imitate Gene Electronics Inc.'s valuable resources,
capabilities, or competencies. This is primarily because the source for the company's success has been
unclear. The competitors are uncertain if Gene Electronics Inc.'s success is due to its strong leadership,
the skills of its research and development team, or the timing of the company' s product
introductions. Gene Electronics Inc. has been protected from losing its competitive advantage as a
result of
causal ambiguity.
Smooth Fusion Inc. is a software company that has built and acquired numerous assets over the years.
According to the resource-based view of a firm, which of the following assets of Smooth Fusion Inc.
will best enable it to gain and sustain a competitive advantage?
LATEST UPDATE (ALREADY GRADED A+)
Mainline Ltd. is a landline telephone manufacturer whose average return on invested capital is
approximately 2 percent. Because demand for landline telephones has declined significantly, the
industry average return on invested capital has been negative (-5 percent) for the last few years. In
this scenario, Mainline Ltd. has a
competitive advantage.
A positive relationship between vision statements and firm performance is more likely to exist when
organizational structures are aligned with the firm's vision statement.
Visionary companies are able to outperform their competitors because
they provide more aspirational visions.
Managers use the AFI strategy framework to
explain and predict differences in firm performance.
When do employees fail to adopt the organizational values of a firm?
when the top managers in the firm are merely paying lip service to the firm's stated values
Strategic leadership pertains to the use of power and influence by ________ to direct the activities of
others when pursuing an organization's goals.
corporate executives
The amount of xylene that can be used in household paint is legally limited to 0.03 percent. Anything
beyond this amount is hazardous to health and the environment, and considered a legal offense.
Consequently, CW Paints Corp. has vouched to make its products as safe as possible. Therefore, it
manufactures xylene-free paints even though this increases its costs and reduces the dividends paid
to its shareholders in the long run. Which of the following responsibilities is CW Paints Corp. primarily
compromising in this scenario?
economic responsibilities toward its shareholders
The distribution department at Golden Grains Wheat Company has decided to adopt the FIFO (first in,
first out) method of inventory to dispatch its bags of wheat. Which of the following strategies does
this scenario best illustrate?
functional strategy
A company uses the planned emergence approach in the development of its strategies. Which of the
following is an implication of this?
, The company's organizational structure and systems will be designed to support bottom-up strategic
initiatives.
As a part of strategy formulation, a firm's functional strategy primarily concerns questions relating to
how to implement business strategy.
Which of the following factors most contributes to the U.S. automotive industry being characterized
by high entry barriers?
Car manufacturers require large-scale production in order to be cost-competitive.
Given the structure of the automobile industry, entering the auto manufacturing industry seemed
risky. Yet Tesla Motors joined the fray. Rather than attempting to compete head-on with internal
combustion engines, Tesla Motors entered the all-electric car segment, a much less crowded niche in
the overall car industry. Which of the following is Tesla most hoping to benefit from in this market
niche?
economies of scale
Which of the following features about a buyer indicates that the buyer has high bargaining power?
when the buyer operates in an industry where products are undifferentiated
Pure Carat Inc. is a company that sells 24-carat gold biscuits to companies that manufacture jewelry.
Since the company operates in an industry where many other suppliers sell standardized products, it
can most likely
only achieve competitive parity.
Zoom Zoom Car Rental follows a cost-leadership strategy. Which of the following firms will most likely
be its direct competitor?
Reliable Rental Cars, which follows a low-cost strategy
How does causal ambiguity act as an isolating mechanism for organizations?
It makes it difficult for the competitors to understand why a company has been so successful.
Competitors have found it extremely difficult to imitate Gene Electronics Inc.'s valuable resources,
capabilities, or competencies. This is primarily because the source for the company's success has been
unclear. The competitors are uncertain if Gene Electronics Inc.'s success is due to its strong leadership,
the skills of its research and development team, or the timing of the company' s product
introductions. Gene Electronics Inc. has been protected from losing its competitive advantage as a
result of
causal ambiguity.
Smooth Fusion Inc. is a software company that has built and acquired numerous assets over the years.
According to the resource-based view of a firm, which of the following assets of Smooth Fusion Inc.
will best enable it to gain and sustain a competitive advantage?
