Chapter 3 Multiple Choice Questions

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. Strategic group analysis refers to:

identifying similarities and differences between groups of people who buy and use your firm's goods and services. correct incorrect

identifying strategies for groups of multinational firms. correct incorrect

identifying strategies for similar groups of firms. correct incorrect

identifying firms with similar strategies or competing on similar bases. correct incorrect

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. Mobility barriers are:

barriers which prevent other firms entering the strategic group and threatening the existing members. correct incorrect

barriers which constrain the mobility of multinational firms in foreign markets. correct incorrect

barriers related to the human tendency to reject unfamiliar or negative information. correct incorrect

barriers between countries that prevent multinational firms from crossing borders. correct incorrect

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. Michael Porter has argued that the most important determinant of a firm's profitability is/are:

Conditions in the home diamond correct incorrect

Industry attractiveness correct incorrect

Economies of scale correct incorrect

Bargaining power correct incorrect

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. The Five Forces Model can be used to:

plan a firm's global strategy based on internal firm resources correct incorrect

understand a firm's strategic internal assets in global markets or regional markets correct incorrect

analyse a firm's competitive position in a specific market segment or similar market segments. correct incorrect

explain why industry change may force firms to relocate parts of their business to other countries correct incorrect

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. Obstacles which potential newcomers would encounter when entering a market are called:

Economies of scale correct incorrect

Mobility barriers correct incorrect

Buyer switching costs correct incorrect

Barriers to entry correct incorrect

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. Which of the following is NOT an example of barriers to entry?

Buyer switching costs correct incorrect

Economies of scale correct incorrect

Product differentiation correct incorrect

Expected retaliation correct incorrect

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. The concept of the International Product Life Cycle suggests that:

Every basic product evolves through a cycle of roughly four stages-introduction, growth, maturity, and decline-which correspond to the rate of growth of industry sales. correct incorrect

The shelve life of a product depends on international product competition. correct incorrect

International products are first designed by innovative developing countries and then are exported to developed country markets. correct incorrect

Products go through an international life cycle, during which a developed country is initially an exporter, then loses its export markets, and finally could become an importer of the product from developing countries. correct incorrect

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. The International Product Life Cycle does not apply to non-standard industrial products such as:

Ship-building correct incorrect

Luxury products correct incorrect

Televisions correct incorrect

DVD players correct incorrect

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. Forecasts are:

complex exercises to understand the causes of and interrelationships among new trends. correct incorrect

mental pictures of future scenarios. correct incorrect

educated assumptions about future trends and events. correct incorrect

hypothetical sequences of events constructed for the purpose of focusing attention on causal processes and decision points. correct incorrect

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. Which multinational firm pioneered the use of scenarios?

British Airways correct incorrect

Shell correct incorrect

Hewlett Packard correct incorrect

Sony correct incorrect