MGT603 solved Mid term

106. SPACE Matrix contains two types of dimensions. Which of the following are

the two external dimensions to be considered in SPACE Matrix?

► Environmental stability and industry strength

► Environmental stability and competitive advantage

► Industry strength and competitive advantage

► Industry strength and Financial strength

Ref: SPACE Matrix represent two internal dimensions financial strength [FS] and

competitive advantage [CA]) and two external dimensions (environmental

stability [ES] and industry strength [IS]).

107. What type of strategies would you recommend when a firm’s SPACE Matrix

directional vector has the coordinates (-4, -4)?

► Aggressive

► Conservative

► Competitive

► Defensive

108. BCG matrix is used in matching stage of strategy formulation framework. It

plots the business units along which of the following dimensions?

► Market share and industry strength

► Market share and market growth rate

► Market growth rate and competitive position

► Market growth rate and environment stability

Ref: To use the chart, corporate analysts would plot a scatter graph of their

business units, ranking their relative market shares and the growth rates of their

respective industries

109. Business units that have low market share and are operating in slowgrowing

industry should choose all of the following EXCEPT:

► New investments

► Production efficiency

► Distribution efficiency

► Product innovation

Ref: They depress a profitable company's return on assets ratio, used by many

investors to judge how well a company is being managed. Dogs, it is thought,

should be sold off.

110. When a division of an organization has a high relative market share and is

in a fast-growing industry, it will be categorized as which type in BCG matrix?

► Star

► Cash cow

► Question mark

► Dog

Ref: Stars Units with a high market share in a fast-growing industry. The hope is

that stars become the next cash cows.

111. Which of the following is the first step in developing QSPM?

► Developing a list of the firm’s key external and internal factors

► Determining the Attractiveness Scores for each strategy

► Examine the Stage 2 matrices and identify alternative strategies

► Assigning weights to each key external and internal factor

Step in developing QSPM

1. Developing a list of the firm’s key external and internal factors

2. Assigning weights to each key external and internal factor

3. Examine the Stage 2 matrices and identify alternative strategies

4. Determining the Attractiveness Scores for each strategy

5. Compute the Total Attractiveness Scores

6. Compute the Sum Total Attractiveness Score

112. Advantages of a functional organization structure would include

all EXCEPT which one of the following?

► Promotes division and specialization of labor

► Promotes functional rivalry

► Promotes economic efficiency

► Promotes delegation of authority

Ref:Besides being simple and inexpensive, a functional structure also promotes

specialization of labor, encourages efficiency, minimizes the need for an

elaborate control system, and allows rapid decision making. Some

disadvantages of a functional structure are that it forces accountability to the top,

minimizes career development opportunities, and is sometimes characterized by

low employee morale, line/staff conflicts, poor delegation of authority, and

inadequate planning for products and markets.

113. Which one of the following is the organizational structure that most of the

medium-size organizations follow?

► Divisional structure

► Strategic business unit

► Functional structure

► Matrix structure

Ref: Small firms tend to be functionally structured (centralized).

Medium-size firms tend to be divisionally structured (decentralized).

Large firms tend to use an SBU (strategic business unit) or matrix structure

114. A divisional structure by geographic area is most appropriate in which of

the following situation?

► Organizations have similar branch facilities in dispersed areas

► Organization offers a limited number of products or services

► Organization needs strict control over product lines

► Organization has to serve a large geographic area

Ref: This type of structure can be most appropriate for organizations that have

similar branch facilities located in widely dispersed areas

115. Which of the following is best identified as being an adaptation of the

divisional structure?

► Vertical Integration

► Strategic business units

► Joint venture

► None of the given options