Question 1

A firm creates a competitive advantage when it develops and manages corporate-level cooperative strategies in a way that is valuable, rare, imperfectly imitable and nonsubstitutable.

Accepted Answer

A) True 
 B)False

Question 2

In the franchising strategy, the most important competitive advantage for the franchisee is the franchisor's

Accepted Answer

A)   brand name.
B)   capital resources.
C)   access to a consolidated market.
D)   geographic locations.

Question 3

Although governments in free-market economies allow rivals to collaborate to improve competitiveness, the challenge is to make sure the alliance does not lead to price fixing.

Accepted Answer

A) True 
 B)False

Question 4

Nonequity strategic alliances are formed when one partner owns a much larger (or inequitable) share of the joint venture than do the remaining partner(s).

Accepted Answer

A) True 
 B)False

Question 5

FrameCo, a maker of commercial greenhouses, has just extricated itself from a failing cooperative alliance with another firm. The expected synergies never were achieved, and FrameCo lost most of its investment. The top management of FrameCo should

Accepted Answer

A)   avoid future cooperative alliances because they lack the skills needed to manage them successfully.
B)   enter into future cooperative alliances only if the alliance is closely monitored by a third party to prevent opportunistic behavior by the alliance partner.
C)   realize that most cooperative alliances fail and that it should ally itself only with an experienced alliance partner in the future.
D)   internalize the knowledge about the successes and failures of this alliance so FrameCo can learn from the experience.

Question 6

McDonald's, Hilton International, and Subway all heavily rely on the ____ strategy.

Accepted Answer

A)   transnational
B)   network cooperative
C)   cross-border alliances
D)   franchising cooperative

Question 7

Why are alliances in the airline industry unstable?

Accepted Answer

A)   Unstable industries make for unstable alliances.
B)   The potential for firms to take opportunistic actions is too widespread.
C)   The industry is declining and profits are not sufficient to divide among alliance partners.
D)   The alliances require cooperation among firms that must also compete with one another.

Question 8

Mutual forbearance is

Accepted Answer

A)   illegal in the U.S.
B)   a type of competition reducing strategy.
C)   a variety of risk-sharing by firms in highly fragmented industries.
D)   exercised when alliance partners refrain from opportunistic behaviors.

Question 9

A strategic alliance in which the partners own different percentages of the new company they have formed is called a(an)

Accepted Answer

A)   equity strategic alliance.
B)   joint venture.
C)   nonequity strategic alliance.
D)   cooperative arrangement.

Question 10

The use of strategic alliances

Accepted Answer

A)   is unlikely to yield success if partnering firms are headquartered in the same country.
B)   may be too restrictive to facilitate entry into new markets.
C)   usually increases the investment necessary to introduce new products.
D)   is more frequent than other types of cooperative strategies.

Question 11

The Renault Nissan alliance discussed in the Opening Case is an example of a ________ in that the firms seek to create economies of scope by sharing their resources and capabilities to develop manufacturing platforms that can be used to produce cars that will be either a Renault or a Nissan.

Accepted Answer

A)   joint venture.
B)   synergistic alliance.
C)   horizontal complementary alliance.
D)   dynamic alliance network.

Question 12

To increase the likelihood of success between partners assuming that trust exists, ____ approach(es)  should be used to manage cooperative strategies.

Accepted Answer

A)   the cost minimization
B)   the opportunity maximization
C)   both the cost minimization and opportunity maximization
D)   none of the these

Question 13

Meredith Inc. is a manufacturer of art supplies. The company has announced plans to enter into an equity strategic alliance with JaZz Paper to develop a line of specialty papers for use with a line of specialty paints Meredith manufactures. Which of the following would be the accurate interpretation of this announcement?

Accepted Answer

A)   Meredith will own a majority equity stake in the new venture.
B)   JaZz will own a majority equity stake in the new venture.
C)   Meredith or JaZz will own an equal equity stake in the new venture.
D)   Either Meredith or JaZz will own a majority equity stake, but we do not know which one based on the announcement.

Question 14

For the purpose of diversification, a corporate-level cooperative strategy may be preferable to a merger or acquisition for all the following reasons EXCEPT

Accepted Answer

A)   a host nation may forbid a merger or acquisition.
B)   opportunistic behaviors are less likely.
C)   cooperative strategies require fewer resources.
D)   cooperative strategies allow greater flexibility in diversifying the firm's portfolio .

Question 15

____ are LEAST likely to involve potential or current competitors.

Accepted Answer

A)   Mutual forbearance strategies
B)   Tacit collusion strategies
C)   Horizontal complementary strategic alliances
D)   Vertical complementary strategic alliances

Question 16

A strategy in which firms work together to achieve a shared objective is a

Accepted Answer

A)   functional-level strategy.
B)   business-level strategy.
C)   corporate-level strategy.
D)   cooperative strategy.

Question 17

In a cross-border alliance, the local partner is often a useful source of information about

Accepted Answer

A)   sources of capital.
B)   the strengths of the foreign firm's technology.
C)   market synergies.
D)   long-term planning.

Question 18

Franchising is an alternative to pursuing growth through mergers and acquisitions.

Accepted Answer

A) True 
 B)False

Question 19

Fujitsu Siemens Computers is a legally independent company of which Fujitsu and Siemens each own 50%. (Chapter 9 Strategic Focus) . This collaboration is an example of a ________ which is effective at transferring ___________.

Accepted Answer

A)   nonequity strategic alliance; explicit knowledge
B)   joint venture; tacit knowledge
C)   joint venture; explicit knowledge
D)   equity strategic alliance; tacit knowledge

Question 20

Within the Renault Nissan alliance (Chapter 9 Opening Case) , both Renault and Nissan have each formed ____________ strategic alliances at the business-unit level with other companies.

Accepted Answer

A)   vertical complementary
B)   horizontal complementary
C)   synergistic
D)   diversifying

Exam 9: Cooperative Implications for Strategy

Fujitsu Siemens Computers is a legally independent company of which Fujitsu and Siemens each own 50%. (Chapter 9 Strategic Focus) . This collaboration is an example of a which is effective at transferring ___.

Correct Answer
verified

The Renault Nissan alliance discussed in the Opening Case is an example of a ________ in that the firms seek to create economies of scope by sharing their resources and capabilities to develop manufacturing platforms that can be used to produce cars that will be either a Renault or a Nissan.

Correct Answer
verified

____ are LEAST likely to involve potential or current competitors.

Correct Answer
verified

Franchising is an alternative to pursuing growth through mergers and acquisitions.

Correct Answer
verified

Correct Answer
verified

A firm creates a competitive advantage when it develops and manages corporate-level cooperative strategies in a way that is valuable, rare, imperfectly imitable and nonsubstitutable.

Correct Answer
verified

For the purpose of diversification, a corporate-level cooperative strategy may be preferable to a merger or acquisition for all the following reasons EXCEPT

Correct Answer
verified

Although governments in free-market economies allow rivals to collaborate to improve competitiveness, the challenge is to make sure the alliance does not lead to price fixing.

Correct Answer
verified

A strategic alliance in which the partners own different percentages of the new company they have formed is called a(an)

Correct Answer
verified

In the franchising strategy, the most important competitive advantage for the franchisee is the franchisor's

Correct Answer
verified

The use of strategic alliances

Correct Answer
verified

A strategy in which firms work together to achieve a shared objective is a

Correct Answer
verified

Within the Renault Nissan alliance (Chapter 9 Opening Case) , both Renault and Nissan have each formed ____________ strategic alliances at the business-unit level with other companies.

Correct Answer
verified

To increase the likelihood of success between partners assuming that trust exists, ____ approach(es) should be used to manage cooperative strategies.

Correct Answer
verified

In a cross-border alliance, the local partner is often a useful source of information about

Correct Answer
verified

Why are alliances in the airline industry unstable?

Correct Answer
verified

McDonald's, Hilton International, and Subway all heavily rely on the ____ strategy.

Correct Answer
verified

Nonequity strategic alliances are formed when one partner owns a much larger (or inequitable) share of the joint venture than do the remaining partner(s).

Correct Answer
verified

FrameCo, a maker of commercial greenhouses, has just extricated itself from a failing cooperative alliance with another firm. The expected synergies never were achieved, and FrameCo lost most of its investment. The top management of FrameCo should

Correct Answer
verified

Mutual forbearance is

Correct Answer
verified

Exam 9: Cooperative Implications for Strategy

Fujitsu Siemens Computers is a legally independent company of which Fujitsu and Siemens each own 50%. (Chapter 9 Strategic Focus) . This collaboration is an example of a ________ which is effective at transferring ___________.

Correct AnswerverifiedShow Answer

The Renault Nissan alliance discussed in the Opening Case is an example of a ________ in that the firms seek to create economies of scope by sharing their resources and capabilities to develop manufacturing platforms that can be used to produce cars that will be either a Renault or a Nissan.

Correct AnswerverifiedShow Answer

____ are LEAST likely to involve potential or current competitors.

Correct AnswerverifiedShow Answer

Franchising is an alternative to pursuing growth through mergers and acquisitions.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A firm creates a competitive advantage when it develops and manages corporate-level cooperative strategies in a way that is valuable, rare, imperfectly imitable and nonsubstitutable.

Correct AnswerverifiedShow Answer

For the purpose of diversification, a corporate-level cooperative strategy may be preferable to a merger or acquisition for all the following reasons EXCEPT

Correct AnswerverifiedShow Answer

Although governments in free-market economies allow rivals to collaborate to improve competitiveness, the challenge is to make sure the alliance does not lead to price fixing.

Correct AnswerverifiedShow Answer

A strategic alliance in which the partners own different percentages of the new company they have formed is called a(an)

Correct AnswerverifiedShow Answer

In the franchising strategy, the most important competitive advantage for the franchisee is the franchisor's

Correct AnswerverifiedShow Answer

The use of strategic alliances

Correct AnswerverifiedShow Answer

A strategy in which firms work together to achieve a shared objective is a

Correct AnswerverifiedShow Answer

Within the Renault Nissan alliance (Chapter 9 Opening Case) , both Renault and Nissan have each formed ____________ strategic alliances at the business-unit level with other companies.

Correct AnswerverifiedShow Answer

To increase the likelihood of success between partners assuming that trust exists, ____ approach(es) should be used to manage cooperative strategies.

Correct AnswerverifiedShow Answer

In a cross-border alliance, the local partner is often a useful source of information about

Correct AnswerverifiedShow Answer

Why are alliances in the airline industry unstable?

Correct AnswerverifiedShow Answer

McDonald's, Hilton International, and Subway all heavily rely on the ____ strategy.

Correct AnswerverifiedShow Answer

Nonequity strategic alliances are formed when one partner owns a much larger (or inequitable) share of the joint venture than do the remaining partner(s).

Correct AnswerverifiedShow Answer

FrameCo, a maker of commercial greenhouses, has just extricated itself from a failing cooperative alliance with another firm. The expected synergies never were achieved, and FrameCo lost most of its investment. The top management of FrameCo should

Correct AnswerverifiedShow Answer

Mutual forbearance is

Correct AnswerverifiedShow Answer

Fujitsu Siemens Computers is a legally independent company of which Fujitsu and Siemens each own 50%. (Chapter 9 Strategic Focus) . This collaboration is an example of a which is effective at transferring ___.

Correct Answer
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