1|Page
MBA 620 Final Exam Actual Exam Newest 2025/2026 Complete
Questions And Correct Detailed Answers (Verified Answers) |Brand
New Version!!
A firm implements a cost leadership strategy. Which is the primary source of its
competitive advantage?
A. Premium product quality
B. Lowest production and operating costs
C. Strong customer loyalty
D. Broad differentiation in product features
Answer: B. Lowest production and operating costs
When analyzing an industry’s attractiveness, which of Porter’s Five Forces directly
addresses the threat of new companies entering the market?
A. Supplier power
B. Threat of substitutes
C. Threat of new entrants
D. Buyer power
Answer: C. Threat of new entrants
A company has invested heavily in R&D and innovation, seeking to offer unique features.
Which generic strategy is being pursued?
A. Focused low-cost
B. Differentiation
C. Cost leadership
D. Retrenchment
Answer: B. Differentiation
,2|Page
Which financial metric is most useful in evaluating shareholder value creation?
A. Net profit margin
B. Return on equity (ROE)
C. Debt-to-equity ratio
D. Inventory turnover
Answer: B. Return on equity (ROE)
If a multinational corporation decides to license its technology instead of building its own
facility abroad, which entry strategy is it using?
A. Greenfield investment
B. Joint venture
C. Exporting
D. Licensing
Answer: D. Licensing
Which tool is most appropriate for evaluating internal company strengths and weaknesses?
A. PESTEL analysis
B. SWOT analysis
C. Porter’s Five Forces
D. Value chain analysis
Answer: B. SWOT analysis
An airline reduces ticket prices below cost to drive a competitor out of the market. This is
an example of:
A. Economies of scale
B. Predatory pricing
C. Price skimming
D. Penetration pricing
Answer: B. Predatory pricing
,3|Page
In corporate governance, the primary role of the board of directors is to:
A. Handle daily operations
B. Protect shareholder interests and oversee management
C. Market the company’s products
D. Manage employee training
Answer: B. Protect shareholder interests and oversee management
A company that vertically integrates backward is attempting to:
A. Acquire distribution channels
B. Control suppliers of raw materials
C. Reduce customer bargaining power
D. Increase market diversification
Answer: B. Control suppliers of raw materials
Which is the key objective of a diversification strategy?
A. Reduce R&D spending
B. Achieve synergy and reduce risk exposure
C. Minimize employee turnover
D. Focus only on the core product line
Answer: B. Achieve synergy and reduce risk exposure
Which leadership style is most associated with empowering employees and fostering
innovation?
A. Transactional leadership
B. Autocratic leadership
C. Transformational leadership
D. Bureaucratic leadership
Answer: C. Transformational leadership
, 4|Page
The Balanced Scorecard is primarily used to:
A. Measure only financial performance
B. Align business activities with vision and strategy
C. Focus exclusively on operational efficiency
D. Evaluate market entry timing
Answer: B. Align business activities with vision and strategy
In capital budgeting, the Net Present Value (NPV) rule states that a project should be
accepted if:
A. NPV is greater than zero
B. Internal rate of return is lower than cost of capital
C. Payback period is longest
D. NPV is negative
Answer: A. NPV is greater than zero
Which of the following is an example of a strategic alliance?
A. A merger between two competitors
B. A company acquiring its supplier
C. Two companies collaborating without ownership exchange
D. A firm filing bankruptcy protection
Answer: C. Two companies collaborating without ownership exchange
When a company sells an underperforming division to focus on its core business, it is
pursuing a:
A. Diversification strategy
B. Divestiture strategy
C. Expansion strategy
D. Forward integration strategy
Answer: B. Divestiture strategy
Which type of organizational structure is most suitable for a multinational corporation
with operations across different regions?
A. Functional structure
B. Matrix structure
MBA 620 Final Exam Actual Exam Newest 2025/2026 Complete
Questions And Correct Detailed Answers (Verified Answers) |Brand
New Version!!
A firm implements a cost leadership strategy. Which is the primary source of its
competitive advantage?
A. Premium product quality
B. Lowest production and operating costs
C. Strong customer loyalty
D. Broad differentiation in product features
Answer: B. Lowest production and operating costs
When analyzing an industry’s attractiveness, which of Porter’s Five Forces directly
addresses the threat of new companies entering the market?
A. Supplier power
B. Threat of substitutes
C. Threat of new entrants
D. Buyer power
Answer: C. Threat of new entrants
A company has invested heavily in R&D and innovation, seeking to offer unique features.
Which generic strategy is being pursued?
A. Focused low-cost
B. Differentiation
C. Cost leadership
D. Retrenchment
Answer: B. Differentiation
,2|Page
Which financial metric is most useful in evaluating shareholder value creation?
A. Net profit margin
B. Return on equity (ROE)
C. Debt-to-equity ratio
D. Inventory turnover
Answer: B. Return on equity (ROE)
If a multinational corporation decides to license its technology instead of building its own
facility abroad, which entry strategy is it using?
A. Greenfield investment
B. Joint venture
C. Exporting
D. Licensing
Answer: D. Licensing
Which tool is most appropriate for evaluating internal company strengths and weaknesses?
A. PESTEL analysis
B. SWOT analysis
C. Porter’s Five Forces
D. Value chain analysis
Answer: B. SWOT analysis
An airline reduces ticket prices below cost to drive a competitor out of the market. This is
an example of:
A. Economies of scale
B. Predatory pricing
C. Price skimming
D. Penetration pricing
Answer: B. Predatory pricing
,3|Page
In corporate governance, the primary role of the board of directors is to:
A. Handle daily operations
B. Protect shareholder interests and oversee management
C. Market the company’s products
D. Manage employee training
Answer: B. Protect shareholder interests and oversee management
A company that vertically integrates backward is attempting to:
A. Acquire distribution channels
B. Control suppliers of raw materials
C. Reduce customer bargaining power
D. Increase market diversification
Answer: B. Control suppliers of raw materials
Which is the key objective of a diversification strategy?
A. Reduce R&D spending
B. Achieve synergy and reduce risk exposure
C. Minimize employee turnover
D. Focus only on the core product line
Answer: B. Achieve synergy and reduce risk exposure
Which leadership style is most associated with empowering employees and fostering
innovation?
A. Transactional leadership
B. Autocratic leadership
C. Transformational leadership
D. Bureaucratic leadership
Answer: C. Transformational leadership
, 4|Page
The Balanced Scorecard is primarily used to:
A. Measure only financial performance
B. Align business activities with vision and strategy
C. Focus exclusively on operational efficiency
D. Evaluate market entry timing
Answer: B. Align business activities with vision and strategy
In capital budgeting, the Net Present Value (NPV) rule states that a project should be
accepted if:
A. NPV is greater than zero
B. Internal rate of return is lower than cost of capital
C. Payback period is longest
D. NPV is negative
Answer: A. NPV is greater than zero
Which of the following is an example of a strategic alliance?
A. A merger between two competitors
B. A company acquiring its supplier
C. Two companies collaborating without ownership exchange
D. A firm filing bankruptcy protection
Answer: C. Two companies collaborating without ownership exchange
When a company sells an underperforming division to focus on its core business, it is
pursuing a:
A. Diversification strategy
B. Divestiture strategy
C. Expansion strategy
D. Forward integration strategy
Answer: B. Divestiture strategy
Which type of organizational structure is most suitable for a multinational corporation
with operations across different regions?
A. Functional structure
B. Matrix structure
