Strategic Management Concepts 3rd Edition By Frank Rothaermel – Test Bank
Business Strategy: Differentiation, Cost Leadership, and Blue Oceans
Multiple Choice Questions
A _____ primarily details the goal-directed actions managers take in their quest for competitive advantage when competing in a single product market.
A. business-level strategy
B. code of ethics
C. mission statement
D. functional-level strategy
Which of the following is a firm effect that has an impact on the competitive advantage of a firm?
A. the exit barriers within the industry in which the firm operates
B. the number of companies operating in the industry in which the firm operates
C. the intensity of rivalry among existing companies in the firm’s chosen industry
D. the value and the cost position of the firm relative to its competitors
A firm’s business strategy will lead to a competitive advantage if it allows the firm to
A. execute the same activities performed by the rivals in a similar manner.
B. reduce the value gap.
C. perform different activities than its rivals.
D. position itself below the productivity frontier.
When a firm makes choices between a cost or value position to achieve competitive advantage, it is primarily involved in
A. collective bargaining.
B. strategic trade-offs.
Firms pursuing a differentiation strategy primarily seek to
A. keep their cost structures lower than that of the cost leader.
B. reduce the value gap to gain a competitive advantage.
C. provide products that are a direct imitation of the competitors’ products.
D. create higher customer perceived value than the value that competitors create.
Home Smart Inc. is a chain of supermarkets that sells its products at higher prices than its competitors. Yet, the supermarket chain has a large customer base due to its wide product portfolio and superior customer service. Which of the following generic business strategies has Home Smart adopted in this scenario?
C. market penetration
D. product diversification