TEST BANK FOR g g
Strategic Management 6th Edition Rothaermel Frank
g g g g g
ISBN 9781265954574
g
Chapter 1-12 Answers are at the End of Each Chapter
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Chapter 1 g
Student name: g
1) A good strategy allows a firm to achieve superior performance and sustainable competitive
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gadvantage without regard to the external environment.
g g g g g g
⊚ true g
⊚ false g
2) The following statement by the chief executive of MegaFilms movie studio should not be
g g g g g g g g g g g g g
gused as a strategy: “We will produce the greatest films of the 21st century.”
g g g g g g g g g g g g g
⊚ true g
⊚ false g
3) The three tasks of the AFI strategy framework are to Assemble a prototype, Find a buyer, and
g g g g g g g g g g g g g g g g
g Incorporate feedback. g
⊚ true g
⊚ false g
4) Questions asked during the strategy analysis stage of the AFI framework should include
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g“What effects do forces in the external environment have on the firm’s potential to gain and
g g g g g g g g g g g g g g g
gsustain a competitive advantage?”
g g g
⊚ true g
⊚ false g
,5) Once a strategy has been formulated and implemented, it is important that the firm sticks to it
g g g g g g g g g g g g g g g g
gno matter what happens.
g g g
⊚ true g
⊚ false g
6) Because they are a crucial component of a firm’s success, customers are considered internal
g g g g g g g g g g g g g
gstakeholders.
⊚ true g
⊚ false g
7) A firm is required by society and its shareholders to meet its ethical and philanthropic
g g g g g g g g g g g g g g
gresponsibilities.
⊚ true g
⊚ false g
8) Stakeholder impact analysis provides a decision tool that helps strategic leaders recognize the
g g g g g g g g g g g g
gneeds of different stakeholders.
g g g
⊚ true g
⊚ false g
9) Juan wants to open his own hot dog restaurant but doesn’t know anything about business. He
g g g g g g g g g g g g g g g
gneeds help determining who his competition is, how he should craft his strategy to compete
g g g g g g g g g g g g g g
gand how he’ll implement his strategy to achieve a competitive advantage. He’s hired you to
g g g g g g g g g g g g g g
ghelp him get started. As a result, you will probably use which of the following?
g g g g g g g g g g g g g g
A) AFI strategy framework g g
B) Red Queen effect g g
C) competitive benchmarking g
D) Stakeholder Impact analysis g g
,10) Roberta is interested in the concept of strategy and decides to create her own. As a result,
g g g g g g g g g g g g g g g g
gRoberta says that her strategy is to focus on competitive benchmarking to achieve
g g g g g g g g g g g g
gcompetitive advantage. Which is the best evaluation of Roberta’s statement?
g g g g g g g g g
A) Roberta’s strategy is clear, but she should provide more detail. g g g g g g g g g
B) Roberta’s strategy reveals a clear strategic position and tradeoff, so she should
g g g g g g g g g g g
proceed. g
C) Roberta should reevaluate her statement because it fails to mention more than one
g g g g g g g g g g g g
strategy. g
D) Roberta should reevaluate her statement because it fails to meet the principles of what
g g g g g g g g g g g g g
a strategy should be.
g g g g
11) Tony’s Pizza Shop is able to net $10,000 a week; this makes the shop profitable. Its number
g g g g g g g g g g g g g g g g
gone competitor, Leo’s Pies, is also profitable, netting $12,000 a week. Lil Anthony’s Pizza
g g g g g g g g g g g g g
gPalace nets $13,000 a week. Since Tony’s Pizza Shop is profitable, we can conclude that it
g g g g g g g g g g g g g g g
ghas a competitive advantage in its industry.
g g g g g g
A) True—competitive advantage is achieved through profitability alone. g g g g g g
B) True—competitive advantage is achieved since Tony has a positive net income. g g g g g g g g g g
C) False—competitive advantage is only achieved by generating above average returns, g g g g g g g g g
relative to competition.
g g g
D) False—Tony more than likely has a sustained competitive advantage since he’s been g g g g g g g g g g g
in business longer.
g g g
12) Bill’s Auto & Airplane Repair shop is able to generate a positive net income of $10,000 a
g g g g g g g g g g g g g g g g
gweek, which is about the same as the income of a close competitor. As a result, we can
g g g g g g g g g g g g g g g g g
gconclude that the two businesses also have a competitive parity in the industry.
g g g g g g g g g g g g
A) Correct—competitive advantage is achieved through profitability alone. g g g g g g
B) Correct—competitive advantage is achieved since Bill’s Auto & Airplane Repair shop g g g g g g g g g g
has a positive net income.
g g g g g
C) Correct—competitive parity is a performance of two or more firms at the same level. g g g g g g g g g g g g g
D) Incorrect—Bill’s Auto & Airplane Repair shop more than likely has a sustained g g g g g g g g g g g
competitive advantage because the business is diversified.
g g g g g g g
, 13) To better achieve a competitive advantage, firms must now adopt a holistic approach towards
g g g g g g g g g g g g g
gsatisfying multiple stakeholders opposed to focusing on the needs of their shareholders. What
g g g g g g g g g g g g
gterm is used for this approach?
g g g g g
A) stakeholder strategy g
B) internal shareholder strategy g g
C) value creation strategy g g
D) shareholder relationship strategy g g
14) All of the following are external stakeholders except which of the following?
g g g g g g g g g g g
A) customers
B) creditors
C) alliance partners g
D) competitors
15) John is a bit confused about the difference between stakeholders and stockholders. You meet
g g g g g g g g g g g g g
gwith John and inform him that the main difference is that
g g g g g g g g g g
A) stakeholders are both internal and external to the firm while stockholders are
g g g g g g g g g g g
considered external to the firm.
g g g g g
B) stakeholders are considered internal to the firm while stockholders are external to the
g g g g g g g g g g g g
firm. g
C) stakeholders can be both internal and external while stockholders own shares of a
g g g g g g g g g g g g
firm and are classified as internal to the firm.
g g g g g g g g g
D) stakeholders are external to the firm while stockholders are considered internal to the
g g g g g g g g g g g g
firm. g
16) Which of the following three important stakeholder attributes should managers pay special
g g g g g g g g g g g
gclose attention to in order to better understand stakeholder impact analysis?
g g g g g g g g g g
A) competitive advantage, economic value, and time g g g g g
B) power, legitimacy, and urgency g g g
C) grace under pressure, financial control, and reward power
g g g g g g g
D) shareholder rights plan, board representation and CEO influence
g g g g g g g
Strategic Management 6th Edition Rothaermel Frank
g g g g g
ISBN 9781265954574
g
Chapter 1-12 Answers are at the End of Each Chapter
g g g g g g g g g
Chapter 1 g
Student name: g
1) A good strategy allows a firm to achieve superior performance and sustainable competitive
g g g g g g g g g g g g
gadvantage without regard to the external environment.
g g g g g g
⊚ true g
⊚ false g
2) The following statement by the chief executive of MegaFilms movie studio should not be
g g g g g g g g g g g g g
gused as a strategy: “We will produce the greatest films of the 21st century.”
g g g g g g g g g g g g g
⊚ true g
⊚ false g
3) The three tasks of the AFI strategy framework are to Assemble a prototype, Find a buyer, and
g g g g g g g g g g g g g g g g
g Incorporate feedback. g
⊚ true g
⊚ false g
4) Questions asked during the strategy analysis stage of the AFI framework should include
g g g g g g g g g g g g
g“What effects do forces in the external environment have on the firm’s potential to gain and
g g g g g g g g g g g g g g g
gsustain a competitive advantage?”
g g g
⊚ true g
⊚ false g
,5) Once a strategy has been formulated and implemented, it is important that the firm sticks to it
g g g g g g g g g g g g g g g g
gno matter what happens.
g g g
⊚ true g
⊚ false g
6) Because they are a crucial component of a firm’s success, customers are considered internal
g g g g g g g g g g g g g
gstakeholders.
⊚ true g
⊚ false g
7) A firm is required by society and its shareholders to meet its ethical and philanthropic
g g g g g g g g g g g g g g
gresponsibilities.
⊚ true g
⊚ false g
8) Stakeholder impact analysis provides a decision tool that helps strategic leaders recognize the
g g g g g g g g g g g g
gneeds of different stakeholders.
g g g
⊚ true g
⊚ false g
9) Juan wants to open his own hot dog restaurant but doesn’t know anything about business. He
g g g g g g g g g g g g g g g
gneeds help determining who his competition is, how he should craft his strategy to compete
g g g g g g g g g g g g g g
gand how he’ll implement his strategy to achieve a competitive advantage. He’s hired you to
g g g g g g g g g g g g g g
ghelp him get started. As a result, you will probably use which of the following?
g g g g g g g g g g g g g g
A) AFI strategy framework g g
B) Red Queen effect g g
C) competitive benchmarking g
D) Stakeholder Impact analysis g g
,10) Roberta is interested in the concept of strategy and decides to create her own. As a result,
g g g g g g g g g g g g g g g g
gRoberta says that her strategy is to focus on competitive benchmarking to achieve
g g g g g g g g g g g g
gcompetitive advantage. Which is the best evaluation of Roberta’s statement?
g g g g g g g g g
A) Roberta’s strategy is clear, but she should provide more detail. g g g g g g g g g
B) Roberta’s strategy reveals a clear strategic position and tradeoff, so she should
g g g g g g g g g g g
proceed. g
C) Roberta should reevaluate her statement because it fails to mention more than one
g g g g g g g g g g g g
strategy. g
D) Roberta should reevaluate her statement because it fails to meet the principles of what
g g g g g g g g g g g g g
a strategy should be.
g g g g
11) Tony’s Pizza Shop is able to net $10,000 a week; this makes the shop profitable. Its number
g g g g g g g g g g g g g g g g
gone competitor, Leo’s Pies, is also profitable, netting $12,000 a week. Lil Anthony’s Pizza
g g g g g g g g g g g g g
gPalace nets $13,000 a week. Since Tony’s Pizza Shop is profitable, we can conclude that it
g g g g g g g g g g g g g g g
ghas a competitive advantage in its industry.
g g g g g g
A) True—competitive advantage is achieved through profitability alone. g g g g g g
B) True—competitive advantage is achieved since Tony has a positive net income. g g g g g g g g g g
C) False—competitive advantage is only achieved by generating above average returns, g g g g g g g g g
relative to competition.
g g g
D) False—Tony more than likely has a sustained competitive advantage since he’s been g g g g g g g g g g g
in business longer.
g g g
12) Bill’s Auto & Airplane Repair shop is able to generate a positive net income of $10,000 a
g g g g g g g g g g g g g g g g
gweek, which is about the same as the income of a close competitor. As a result, we can
g g g g g g g g g g g g g g g g g
gconclude that the two businesses also have a competitive parity in the industry.
g g g g g g g g g g g g
A) Correct—competitive advantage is achieved through profitability alone. g g g g g g
B) Correct—competitive advantage is achieved since Bill’s Auto & Airplane Repair shop g g g g g g g g g g
has a positive net income.
g g g g g
C) Correct—competitive parity is a performance of two or more firms at the same level. g g g g g g g g g g g g g
D) Incorrect—Bill’s Auto & Airplane Repair shop more than likely has a sustained g g g g g g g g g g g
competitive advantage because the business is diversified.
g g g g g g g
, 13) To better achieve a competitive advantage, firms must now adopt a holistic approach towards
g g g g g g g g g g g g g
gsatisfying multiple stakeholders opposed to focusing on the needs of their shareholders. What
g g g g g g g g g g g g
gterm is used for this approach?
g g g g g
A) stakeholder strategy g
B) internal shareholder strategy g g
C) value creation strategy g g
D) shareholder relationship strategy g g
14) All of the following are external stakeholders except which of the following?
g g g g g g g g g g g
A) customers
B) creditors
C) alliance partners g
D) competitors
15) John is a bit confused about the difference between stakeholders and stockholders. You meet
g g g g g g g g g g g g g
gwith John and inform him that the main difference is that
g g g g g g g g g g
A) stakeholders are both internal and external to the firm while stockholders are
g g g g g g g g g g g
considered external to the firm.
g g g g g
B) stakeholders are considered internal to the firm while stockholders are external to the
g g g g g g g g g g g g
firm. g
C) stakeholders can be both internal and external while stockholders own shares of a
g g g g g g g g g g g g
firm and are classified as internal to the firm.
g g g g g g g g g
D) stakeholders are external to the firm while stockholders are considered internal to the
g g g g g g g g g g g g
firm. g
16) Which of the following three important stakeholder attributes should managers pay special
g g g g g g g g g g g
gclose attention to in order to better understand stakeholder impact analysis?
g g g g g g g g g g
A) competitive advantage, economic value, and time g g g g g
B) power, legitimacy, and urgency g g g
C) grace under pressure, financial control, and reward power
g g g g g g g
D) shareholder rights plan, board representation and CEO influence
g g g g g g g
