MGT603 FINAL TERM SOLVED PAPERS

171. Which of the following is the best divisional structure when a few major

customers are of paramount importance and many different services are

provided to these customers?

► By geographic area

► By customer

► By product

► By process

Ref: This structure allows an organization to cater effectively to the requirements

of clearly defined customer groups. For example, book publishing companies

often organize their activities around customer groups such as colleges,

secondary schools, and private commercial schools.(Page no.119)

172. How can an ESOP empower employees?

► It empowers employees to work as owners

► It empowers employees to make financial plan

► It empowers employees to assess customer’s needs

► It empowers employees to give training to other workers

Ref: an employee stock ownership plan (ESOP), are corporations owned in whole or

in part by their employees. Employees are usually given a share of the

corporation after a certain length of employment or they can buy shares at any

time.(Page no.128)

173. All of the following steps are required in product positioning EXCEPT:

► Select key criteria that effectively differentiate products or services in the

industry

► Position your firm in the middle of the map

► Plot major competitors’ products or services in the resultant matrix

► Identify areas in the positioning map where the company’s products or

services could be most competitive in the given target market

Ref: The following steps are required in product positioning:

1. Select key criteria that effectively differentiate products or services in the

industry.

2. Diagram a two-dimensional product-positioning map with specified criteria

on each axis.

3. Plot major competitors' products or services in the resultant four-quadrant

matrix.

4. Identify areas in the positioning map where the company's products or

services could be most competitive in the given target market. Look for vacant

areas (niches).

5. Develop a marketing plan to position the company's products or services

appropriately.

174. Some potential problems associated with using quantitative criteria for

evaluating strategies include all of the following EXCEPT:

► Most quantitative criteria are geared to annual objectives rather than longterm

objectives

►These ratios use qualitative data for evaluating strategies which often is not

available

► Different accounting methods can provide different results on many

quantitative criteria

► Intuitive judgments are almost always involved in deriving quantitative

criteria

Rationale: Ratios always use quantitative data for evaluation which is often not

available.

175. Which of the following is MOST appropriate about financial ratios?

► Compare a firm’s performance with competitors

► Compare a firm’s performance with suppliers

► Compare a firm’s performance with non-financial ratios

► Compare a firm’s performance with business standards

Ref: Quantitative criteria commonly used to evaluate strategies are financial

ratios, which strategists use to make three critical comparisons: (1) comparing the

firm's performance over different time periods, (2) comparing the firm's

performance to competitors', and (3) comparing the firm's performance to

industry averages..(Page no.151)

FINALTERM EXAMINATION

Fall 2009 (PAPER 5)

MGT603- Strategic Management (Session - 4)

176. Which of the following is NOT included in the strategic management

model?

► Measure and evaluate performance

► Establish long-term objectives

► Develop mission and vision statements

► Perform internal research to identify customers

177. A mission statement should “reconcile interests among diverse

stakeholders”. What does it mean?

► All shareholders must be satisfied

► Shareholders should be given preference over customers

► Firm will devote attention to meeting claims of various stakeholders

► Firm will devote its attention towards the maximization of shareholders value

178. Which of the following is the first step in the controlling function of

management?

► Take corrective actions

► Restrict breaks employees take

► Evaluate expense reports

► Establish performance standards

179. Which of the following allows an organization to test alternative marketing

plans and to forecast future sales of new products?

► Marketing

► Advertisement

► Test marketing

► Customer analysis

180. The steps required to perform cost/benefit analysis include all BUT:

► Comparing the total costs with the total benefits

► Figure out the total costs associated with a decision

► Approximation of the total benefits from the decision

► Adding the total cost and total benefit

181. In strategy formulation phase, what can be the problem when only

financial ratios are used to measure organizational performance?

► They need to be compared with competitors’

► They are only understandable by accountants

► There are many different measures available

► The measures are usually inconsistent

Financial measures need to be compared with competitors to have any value in a

strategic sense

182. The IFE matrix summarizes and evaluates which factors in the functional

areas of a business?

► Opportunities and threats

► Strengths and weaknesses

► Strengths and threats

► Opportunities and weaknesses

183. The Web sites that sell products directly to the consumers are the examples

of which type of strategy?

► Backward integration

► Product development

► Forward integration

► Horizontal integration

184. Which of the followings best describes the Horizontal Integration?

► A firm takes over a supplier

► A firm takes over a distributor

► A firm takes over a competitor

► A firm takes over a manufacturer

185. Which of the following is a drawback or limitation of Horizontal

Integration?