Question 1

Most of the business models deployed in electronic commerce have no historical precedence

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is not an isolating mechanism?

Accepted Answer

A)  Private ownership of a company which means that it is not obliged to publish its financial statements
B)  Competitive advantage which is based upon the interaction of a number of different resources and capabilities
C)  Competitive advantage based upon exploiting pricing anomalies
D)  Competitive advantage based upon resources that are difficult to transfer and slow to replicate.

Question 3

A firm's competitive advantage is not necessarily revealed in higher profitability;it may be reflected in:

Accepted Answer

A)  Expanding market share
B)  An aggressive quest for acquisitions
C)  Increasing employee bonuses
D)  Expanding market share and/or increasing employee bonuses

Question 4

The difference between "search goods" and "experience goods" depends upon whether customers can ascertain the product's true attributes: on inspection or only after consuming the product

Accepted Answer

A) True 
 B)False

Question 5

In strategic management,the expression "blue oceans" refers to:

Accepted Answer

A)  Radical innovation
B)  The potential offered by uncontested market space
C)  The campaign to reduce pollution in the world's oceans
D)  Cost reduction through offshoring production

Question 6

Cost and differentiation strategies are similar in terms of their potential to confer sustainable competitive advantage.

Accepted Answer

A) True 
 B)False

Question 7

Sustainable competitive advantage can be established in all types of market-including those financial markets deemed to be "efficient."

Accepted Answer

A) True 
 B)False

Question 8

Isolating mechanisms are:

Accepted Answer

A)  Barriers to the erosion of interfirm profit differentials
B)  Mechanisms that impede the equilibration of rents between industries
C)  The same as "barriers to mobility"
D)  Sources of disequilibrium that cause the profitability of different firms in an industry to diverge over time

Question 9

If a firm is more profitable than its rivals,this invariably means that it possesses a competitive advantage.

Accepted Answer

A) True 
 B)False

Question 10

The usefulness of the strategy canvas in developing blue ocean strategies rests on its ability to:

Accepted Answer

A)  Suggest possible applications of frontier technologies
B)  Identify opportunities for recombining existing product attributes in novel ways
C)  Identify unfulfilled customwer needs
D)  Reconfigure a firm's value chain

Question 11

In order to discover a "blue ocean" of uncontested market space,a firm must use technological innovation to create a new product market

Accepted Answer

A) True 
 B)False

Question 12

The fact that a firm's "activity system" comprises closely linked,complementary activities simplifies the task of imitating a competitor's strategy.

Accepted Answer

A) True 
 B)False

Question 13

Physical characteristics of a product are of little importance in determining its potential for differentiation

Accepted Answer

A) True 
 B)False

Question 14

The main challenge of business model innovations is conceiving of novel business models,not implementing them.

Accepted Answer

A) True 
 B)False

Question 15

Pre-emption strategies can help sustain a firm's competitive advantage through:

Accepted Answer

A)  Reducing the opportunities available to competiors to invade the firm's strategic space
B)  Threatening compeitors with retaliation
C)  Engaging in limit pricing that makes entry unprofitable for would-be rivals
D)  Reinforcing barriers of mobility

Question 16

Competitive advantage without purposeful activity by a firm-it may arise through it being favored by an external change.

Accepted Answer

A) True 
 B)False

Question 17

Banks spend more money on their head office buildings than most other large corporations because:

Accepted Answer

A)  They tend to be located in financial centers where property prices are high
B)  They offer "experience goods",hence they need to signal wealth and stability
C)  Their CEOs are more committed to the display of wealth than other CEOs
D)  Because their products are essentially commodities,they need to find alternative ways of differentiating.

Question 18

When an industry is subject to externally generated changes,the firms which are most likely to establish a competitive advantage are:

Accepted Answer

A)  Those with the highest market share
B)  Those that that respond most quickly to the change and have the resources and capabilities that are most closely aligned to the emerging success factors
C)  Those with the greatest agility and capacity for innovation
D)  A combination of (a) , (b) ,and (c) .

Question 19

A firm's competitive advantages can only be sustained if it is protected by some form of "isolating mechanisms."

Accepted Answer

A) True 
 B)False

Question 20

Which of the following product categories offers the greatest potential for differentiation?

Accepted Answer

A)  Clothes and restaurants
B)  Cement and wheat
C)  Jet fuel for airline jets
D)  Sulfur and ethylene

Exam 7: A : The Sources and Dimensions of Competitive Advantage

Sustainable competitive advantage can be established in all types of market-including those financial markets deemed to be "efficient."

Correct AnswerverifiedShow Answer

Competitive advantage without purposeful activity by a firm-it may arise through it being favored by an external change.

Correct AnswerverifiedShow Answer

In order to discover a "blue ocean" of uncontested market space,a firm must use technological innovation to create a new product market

Correct AnswerverifiedShow Answer

Cost and differentiation strategies are similar in terms of their potential to confer sustainable competitive advantage.

Correct AnswerverifiedShow Answer

Most of the business models deployed in electronic commerce have no historical precedence

Correct AnswerverifiedShow Answer

The usefulness of the strategy canvas in developing blue ocean strategies rests on its ability to:

Correct AnswerverifiedShow Answer

The main challenge of business model innovations is conceiving of novel business models,not implementing them.

Correct AnswerverifiedShow Answer

The difference between "search goods" and "experience goods" depends upon whether customers can ascertain the product's true attributes: on inspection or only after consuming the product

Correct AnswerverifiedShow Answer

Which of the following product categories offers the greatest potential for differentiation?

Correct AnswerverifiedShow Answer

A firm's competitive advantage is not necessarily revealed in higher profitability;it may be reflected in:

Correct AnswerverifiedShow Answer

If a firm is more profitable than its rivals,this invariably means that it possesses a competitive advantage.

Correct AnswerverifiedShow Answer

The fact that a firm's "activity system" comprises closely linked,complementary activities simplifies the task of imitating a competitor's strategy.

Correct AnswerverifiedShow Answer

A firm's competitive advantages can only be sustained if it is protected by some form of "isolating mechanisms."

Correct AnswerverifiedShow Answer

Which of the following is not an isolating mechanism?

Correct AnswerverifiedShow Answer

Banks spend more money on their head office buildings than most other large corporations because:

Correct AnswerverifiedShow Answer

Pre-emption strategies can help sustain a firm's competitive advantage through:

Correct AnswerverifiedShow Answer

Physical characteristics of a product are of little importance in determining its potential for differentiation

Correct AnswerverifiedShow Answer

In strategic management,the expression "blue oceans" refers to:

Correct AnswerverifiedShow Answer

When an industry is subject to externally generated changes,the firms which are most likely to establish a competitive advantage are:

Correct AnswerverifiedShow Answer

Isolating mechanisms are:

Correct AnswerverifiedShow Answer

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