MGT603 solved Quizs

51. What will happen to the Pakistani exports in overseas markets when there

is a strong value of rupee?

► Pakistani exports will be less expensive

► Pakistani exports will be more expensive M. file

► Pakistani exports will be more attractive

► Pakistani exports will be desirable

52. Which of the following can be considered as barriers to entering a market

or industry?

► The lack of economies of scale and experience and low levels of brand loyalty

► The presence of large number of rivals already in the industry M. File

► Relatively large capital requirements and industry have economies of scale

► The absence of tariffs, trade restrictions, and/or government-mandated

regulations

53. Which of the following are signs of strength in a company's competitive

position?

► A debt-to-asset ratio below 0.50 and a positive net cash flow

► A website with extensive information about the company and its product line

► R&D and advertising expenditures greater than $10 million annually

► A strongly differentiated product and a strong or rising market share

54. Distribution includes which of the following?

► Customer analysis

► Warehousing p; 62

► Advertising

► Test marketing

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

areas of a business?

► Opportunities and threats

► Strengths and weaknesses M. File

► Strengths and threats

► Opportunities and weaknesses

Ref: A summary step in conducting an internal strategic-management audit is to

construct an Internal Factor Evaluation (IFE) Matrix. This strategy-formulation tool

summarizes and evaluates the major strengths and weaknesses in the functional

areas of a business, and it also provides a basis for identifying and evaluating

relationships among those areas.

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

of which type of strategy?

► Backward integration

► Product development

► Forward integration M. File

► Horizontal integration

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

Integration?

► Synergies may be more imaginary than real M. File

► It can increase suppliers' and buyers' bargaining power

► Economies of scale are likely to be decreased

► Both the first & third options are correct

58. A Cost Leadership Strategy is especially effective in all of the following

situations EXCEPT:

► When the market is composed of many price-sensitive buyers

► When product differentiation can be easily achieved

► When buyers do not care much about differences from brand to brand

► When there are a large number of buyers with significant bargaining power

Striving to be the low-cost producer in an industry can be especially effective

1. When the market is composed of many price-sensitive buyers,

2. When there are few ways to achieve product differentiation,

3. When buyers do not care much about differences from brand to brand,

4. When there are a large number of buyers with significant bargaining

power.

59. If market shares of competitors are declining whereas total industry sales

are increasing, which strategy do you think may be the right one to pursue?

► Divestiture

► Market Penetration M. File

► Market Development

► Retrenchment

Ref: Guidelines for Market Penetration

Four guidelines when market penetration may be an especially effective strategy

are:

Current markets not saturated

Usage rate of present customers can be increased significantly

Market shares of competitors declining while total industry sales increasing

Increased economies of scale provide major competitive advantages

60. Which of the followings involves the substantial modification of existing

products or the creation of new but related products that can be marketed to

current customers through established channels?

► Innovation

► Differentiation

► Product development M. File

► Market development

Ref: Product development is a strategy that seeks increased sales by improving

or modifying present products or services.

61. Which of the following stages of “Strategy Formulation

Framework” involves development of Internal-Factor Evaluation Matrix?

► Input stage

► Output stage

► Matching stage

► Decision stage

Ref: Stage 1 of the formulation framework consists of the EFE Matrix, the IFE

Matrix, and the Competitive Profile Matrix. Called the Input Stage, Stage 1

summarizes the basic input information needed to formulate strategies.

62. Which of the following stages in “Strategy Formulation

Framework” focuses on generating feasible alternative strategies?

► Input

► Output

► Decision

► Matching

Ref: Stage 2, called the Matching Stage, focuses upon generating feasible

alternative strategies by aligning key external and internal factors. Stage 2

techniques include the Threats-Opportunities Weaknesses-Strengths (TOWS)

Matrix, the Strategic Position and Action Evaluation (SPACE) Matrix, the Boston

Consulting Group (BCG) Matrix, the Internal-External (IE) Matrix, and the Grand

Strategy Matrix

63. If there is a shift in consumers’ taste in a society away from the firm’s

products along with weak brand name, which of the following strategy would

you recommend for the above mentioned firm?

► SO

► WO

► SW

► WT

64. Firm located in defensive quadrant of a SPACE matrix is recommended to

follow all of the following strategies EXCEPT:

► Retrenchment

► Forward integration p; 108

► Divestiture

► Liquidation

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

Matrix directional vector has the coordinates (+2, +3)?

► Aggressive

► Conservative

► Competitive

► Defensive

66. A & C Corporation currently possesses a low share of its available market.

Moreover, this company's portfolio reveals that it has extremely low market

growth. A & C Corporation is most likely to be classed as which one of the

following?

► Dog 103

► Question mark

► Star

► Cash cow

Ref: Dogs More charitably called pets, units with low market share in a mature,

slow-growing industry. (see the table at page no.103)

67. Which of the following is a deliberate plan of action, guidelines, methods,

procedures to guide decisions and achieve rational outcome?

► Annual objectives

► Strategies

► Policies

► Goals

Policies include guidelines, rules, and procedures established to support efforts

to achieve stated objectives

68. The organizations, where resource allocation is not based on strategicmanagement

approach to decision making, which approach is used for

resource allocation?

► Financial budget

► Relative importance of departments

► On political or personal factors

► Relative cost of each resources

Ref: Resource allocation is a major management activity that allows for strategy

execution. In organizations that do not use a strategic-management approach to

decision making, resource allocation is often based on political or personal

factors.

69. A state of opposition between persons or ideas which are occasionally

characterized by physical violence may be known as:

► Conflict

► Compromise

► Diffusion

► Avoidance

Ref: Conflict is a state of opposition, disagreement or incompatibility between

two or more people or groups of people, which is sometimes characterized by

physical violence. Military conflict between states may constitute war.

70. Why do changes in company strategy often require changes in the way an

organization is structured?

► Because structure depicts how goals will be established

► Because structure dictates how authorities will be delegated

► Because structure dictates how resources will be obtained

► Because structure dictates how financial resources are spent

Ref: Changes in strategy often require changes in structure because new

positions may be created, deleted, or merged. Organizational structure dictates

how resources are allocated and how objectives are established in a firm.(Page

no.56)