Strategic Management And Competitive Advantage 5th Edition By Barney – Test Bank

Strategic Management And Competitive Advantage 5th Edition By Barney – Test Bank

Strategic Management and Competitive Advantage, 5e (Barney)

Chapter 5   Product Differentiation

1) Wal-Mart exemplifies a firm pursuing a product-differentiation strategy while Victoria’s Secret exemplifies a firm pursuing a cost-leadership strategy.

Answer:  FALSE

Diff: 1

Learning Obj.:  5.1: Define Product Differentiation

AACSB:  Application of Knowledge

2) Product differentiation is a business strategy whereby firms attempt to gain a competitive advantage by increasing the perceived value of their products and services relative to the perceived value of other firms’ products or services.

Answer:  TRUE

Diff: 1

Learning Obj.:  5.1: Define Product Differentiation

AACSB:  Analytical Thinking

3) Attempts to create differences in the relative perceived value of a firm’s products or services are rarely made by altering the objective properties of those products or services.

Answer:  FALSE

Diff: 2

Learning Obj.:  5.1: Define Product Differentiation

AACSB:  Analytical Thinking

4) While firms often alter the objective properties of their products or services to implement a product differentiation strategy, the existence of product differentiation is always a matter of customer perception.

Answer:  TRUE

Diff: 2

Learning Obj.:  5.1: Define Product Differentiation

AACSB:  Analytical Thinking

5) If products or services are perceived as being different in a way that is valued by customers, even if there is no physical differentiation, then product differentiation exists.

Answer:  TRUE

Diff: 2

Learning Obj.:  5.1: Define Product Differentiation

AACSB:  Analytical Thinking

6) A hedonic price is that part of a product’s or service’s actual price that is not attributable to a particular attribute of that product or service.

Answer:  FALSE

Diff: 3

Learning Obj.:  5.2: Describe 11 Bases of Product Differentiation and How They can be grouped into Three Categories

AACSB:  Analytical Thinking

7) Chrysler’s introduction of the “cab forward” design was an attempt at differentiation through product features.

Answer:  TRUE

Diff: 3

Learning Obj.:  5.2: Describe 11 Bases of Product Differentiation and How They Can be Grouped into Three Categories

AACSB:  Application of Knowledge