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Exam 6: Business Level Strategy and the Industry Environment

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Question 41

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The franchisor typically owns and funds each of its franchisees.

A) True
B) False

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Question 42

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A limit price strategy involves charging a price that is lower than that required to maximize profits in the short run,but is above the cost structure of potential entrants.

A) True
B) False

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Question 43

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A leadership strategy aims at growing in a declining industry by picking up the market share of companies that are leaving the industry.

Relish Inc.created the first national chain of fast-food restaurants in a previously fragmented industry.This is called divestment.

Which of the following shakeout strategies requires a company to limit or decrease its investment in a business and to extract,or milk,the proceeds of its investment as much as it can?

Laggards are technologically sophisticated customers willing to tolerate the limitations of the product.

A divestment strategy's success is often dependent upon good timing.

Which of the following factors in an industry is most likely to cause excess capacity?

Which of the following statements is true about customer categories in growing industries?

A technology upgrading strategy is utilized by incumbent companies in a mature industry to deter entry by investing in costly upgrades that potential entrants would have trouble matching.?

Nutrimax Corp.,a breakfast cereal company,has designed extensive and elaborate advertising campaigns for its existing products.The campaigns mainly focus on the features and benefits of the products that differentiate the cereals from the competition.The massive advertising and marketing initiatives are also intended to intimidate new entrants and rivals.Nutrimax Corp.is most likely to be using which of the following strategies?

An app development firm is working on a new product to identify and consolidate a smartphone users' favorite and most used apps into one place on the phone. If the new product will be sold to existing customers,the firm is pursuing a strategy of:

Laggards are the customers who are the first ones to try and adopt a new technology.

A new product's relative advantage refers to the degree to which a new product is perceived as better at satisfying customer needs than the product that it supersedes.

Which of the following is not a characteristic of a fragmented industry?

Price signaling in mature industries happens when:

A_____ strategy aims to help a company grow in a declining industry by picking up the market share of companies that are leaving the industry.

The challenge in a fragmented industry is to figure out the best set of strategies to overcome a fragmented market so that the competitive advantages associated with pursuing one of the different business models can be realized.

Which of the following strategies allows interdependent firms indirectly to coordinate their actions?

The late majority customers are typically reached through specialized distribution channels,and products are often sold by word of mouth.