A+ Answers

Question 1  Once a firm decides to enter an industry and chooses a market in which to compete, it must gain an understanding of its competitive environment. This challenge can be undertaken by completing a(n): A. business analysis. B. industry analysis. C. competitor analysis. D. market analysis. Question 2  Some industries, like the athletic shoe industry, are dominated by a small number of firms with strong brands. These industries are difficult to break into without spending heavily on advertising. The barrier to entry that the firms in these types of industries have erected is referred to as: A. government and legal barriers. B. capital requirements. C. product differentiation. D. access to distribution channels. Question 3  Firms that pursue a(n) __________ strategy compete for market share on a country-by-country basis and vary their product or service offerings to meet the demands of the local market. A. worldwide B. multidomestic C. inclusive D. universal Question 4  Aquafina operates in the bottled water industry. The companies that offer identical or similar products and go after the same customers that Aquafina does are Dasani and Zephyrhills. Dasani and Zephyrhills are Aquafina’s: A. direct competitors. B. indirect competitors. C. impending competitors. D. potential competitors. Question 5  According to the textbook, the three different types of competitors a business will face are: A. potential, direct, and upcoming. B. potential, fleeting, and indirect. C. indirect, fleeting, and future. D. direct, indirect, and future. Question 6  A(n) __________ industry is an industry that is experiencing significant international sales. A. global B. mature C. multi-domestic D. emerging Question 7  Opportunities for leadership, niche, harvest and divestment are associated with __________ industries. A. fragmented B. mature C. declining D. global Question 8  Which of the following is a “support” activity in the value chain? A. outbound logistics B. inbound logistics C. marketing and sales D. resource procurement Question 9  The primary opportunity existing for start-ups in fragmented industries is to: A. grow through product or process innovation. B. consolidate the industry and establish industry leadership as a result. C. capture a first-mover advantage. D. pursue a cost reduction strategy through process innovation. Question 10  Supplier concentration, switching costs, attractiveness of substitutes, and threat of forward integration are factors that have a direct impact on: A. rivalry among existing firms. B. threat of substitutes. C. bargaining power of buyers. D. bargaining power of suppliers. Question 11  If a startup pioneers an industry or a new concept within an industry, the name recognition the startup establishes may create a formidable nontraditional barrier to entry referred to as a(n): A. unique business model. B. competitive superiority. C. aggressive tactical advantage. D. first-mover advantage. Question 12  The term __________ refers to initiatives, such as Netflix in movie rentals and Zipcar in car sharing, which revolutionize how products are sold in an industry. A. product model innovation B. business model innovation C. value innovation D. opportunity innovation Question 13  Catherine Smith has just finished writing a business plan for a startup in the medical products industry. She has now reached the point where she needs to develop a plan for how her firm will compete, use its resources, structure its relationships, interface with customers, and create value to sustain itself on the basis of the profits it earns. Jennifer needs to establish her firm’s: A. tactical plan. B. feasibility plan. C. business model. D. operating plan.