Question 1
Economies of scope
Multiple Choice
stem from cost-saving efficiencies of operating overseas.
are cost reductions that flow from strategic fit along the value chains of related businesses. Correct
accrue from a larger-sized operation.
create more value for shareholders just as economies of scale do.
arise mainly from strategic fit relationships in the distribution portions of the value chains of unrelated businesses.
Question 2
Combination related-unrelated diversification strategies have particular appeal for companies
Multiple Choice
looking to reduce risk by spreading the company's investments over a set of truly diverse industries.
focusing on growth for growth's sake to maximize shareholder value.
desiring high compensation and reduced employment risk.
operating in niche markets where specialized resources and capabilities are needed.
having a mix of valuable competitive assets, covering the spectrum from generalized to special resources and capabilities.
Question 3
The drawbacks of an unrelated diversification strategy include
Multiple Choice
minimal potential for shareholder value creation and financial stability.
limited competitive advantage potential.
financial instability and very demanding managerial requirements.
very demanding managerial requirements and limited competitive advantage potential.
cultural conflicts and very demanding financial requirements.
Question 4
Corporate strategic options for diversified companies would not normally entail
Multiple Choice
sticking closely with the existing business line when the current business line offers attractive growth opportunities.
divesting weak-performing businesses and retrenching to a narrower base of business operations.
broadening the diversification base by adding and acquiring more businesses.
repurchasing shares of the company's common stock and building cash reserves by investing in short-term securities.
restructuring the company's business lineup through a mix of divestitures and new acquisitions.
Question 5
A portfolio business that generates operating cash flows over and above internal requirements, thereby providing financial resources that may be used to finance new acquisitions, fund share buyback programs, or pay dividends is commonly called a
Multiple Choice
cash hog.
cash cow.
star business.
question mark.
cash dog.
Question 6
Which statement points out the main difference between the global and the transnational strategy?
Multiple Choice
A "think-global, act-global" approach entails extensive strategy coordination across countries, while a "think-global, act-local" approach entails little or no strategy coordination across countries.
A global strategy must cope with high production and distribution costs due to greater variety, whereas a transnational strategy can create large economies.
A transnational strategy gives local managers more room to make strategy changes to better satisfy local buyers and to better match local market conditions.
A global strategy involves selling a standardized product worldwide, whereas a transnational strategy entails selling products that are highly differentiated from country to country.
A global strategy involves selling under a single brand name worldwide, whereas a transnational strategy focuses on utilizing multiple brands.
Question 7
Cross-border acquisition strategies provide companies with the advantage of
Multiple Choice
being able to avoid the addition of debt
being able to benefit from collaborative research
minimizing the costs and risks associated with establishing a foreign business location
having a high level of control, as well as speed, when entering a market on a large scale
setting up every aspect of the operation to its specification
Question 8
Which of the following is an example of a multidomestic strategy?
Multiple Choice
Mattel's black Barbie is popular in Africa.
Microsoft offers the same software programs around the world.
Red Bull products are packaged differently for the Chinese market.
BMW designed its 3 Series cars for multiple markets.
Heinz ketchup in India does not have garlic and onion.
Question 9
To use location to build competitive advantage when competing on domestic and international levels, a company must
Multiple Choice
use acquisition and rapid-growth strategies to better defend against expansion-minded internationals.
try to change the local market to better match the way the company does business elsewhere.
be prepared to modify aspects of the company's business model or strategy to accommodate local circumstances.
consider (1) whether to concentrate each activity it performs in a few select countries or disperse performance of the activity to many nations, and (2) determine in which countries it should locate particular activities.
transfer company expertise to cross-border markets and initiate actions to contend on an international level.
Question 10
Factors that do not make competing across national borders more difficult than competing domestically include
Multiple Choice
country-to-country differences in consumer buying habits and buyer tastes and preferences
the difficulty in achieving strategic fit in sales and marketing activities
variations in government policies, tax rates, inflation rates, and other economic conditions from country to country
the potential for location-based advantages in some countries
vulnerability to adverse shifts in currency exchange rates
Economies of scope
Multiple Choice
stem from cost-saving efficiencies of operating overseas.
are cost reductions that flow from strategic fit along the value chains of related businesses. Correct
accrue from a larger-sized operation.
create more value for shareholders just as economies of scale do.
arise mainly from strategic fit relationships in the distribution portions of the value chains of unrelated businesses.
Question 2
Combination related-unrelated diversification strategies have particular appeal for companies
Multiple Choice
looking to reduce risk by spreading the company's investments over a set of truly diverse industries.
focusing on growth for growth's sake to maximize shareholder value.
desiring high compensation and reduced employment risk.
operating in niche markets where specialized resources and capabilities are needed.
having a mix of valuable competitive assets, covering the spectrum from generalized to special resources and capabilities.
Question 3
The drawbacks of an unrelated diversification strategy include
Multiple Choice
minimal potential for shareholder value creation and financial stability.
limited competitive advantage potential.
financial instability and very demanding managerial requirements.
very demanding managerial requirements and limited competitive advantage potential.
cultural conflicts and very demanding financial requirements.
Question 4
Corporate strategic options for diversified companies would not normally entail
Multiple Choice
sticking closely with the existing business line when the current business line offers attractive growth opportunities.
divesting weak-performing businesses and retrenching to a narrower base of business operations.
broadening the diversification base by adding and acquiring more businesses.
repurchasing shares of the company's common stock and building cash reserves by investing in short-term securities.
restructuring the company's business lineup through a mix of divestitures and new acquisitions.
Question 5
A portfolio business that generates operating cash flows over and above internal requirements, thereby providing financial resources that may be used to finance new acquisitions, fund share buyback programs, or pay dividends is commonly called a
Multiple Choice
cash hog.
cash cow.
star business.
question mark.
cash dog.
Question 6
Which statement points out the main difference between the global and the transnational strategy?
Multiple Choice
A "think-global, act-global" approach entails extensive strategy coordination across countries, while a "think-global, act-local" approach entails little or no strategy coordination across countries.
A global strategy must cope with high production and distribution costs due to greater variety, whereas a transnational strategy can create large economies.
A transnational strategy gives local managers more room to make strategy changes to better satisfy local buyers and to better match local market conditions.
A global strategy involves selling a standardized product worldwide, whereas a transnational strategy entails selling products that are highly differentiated from country to country.
A global strategy involves selling under a single brand name worldwide, whereas a transnational strategy focuses on utilizing multiple brands.
Question 7
Cross-border acquisition strategies provide companies with the advantage of
Multiple Choice
being able to avoid the addition of debt
being able to benefit from collaborative research
minimizing the costs and risks associated with establishing a foreign business location
having a high level of control, as well as speed, when entering a market on a large scale
setting up every aspect of the operation to its specification
Question 8
Which of the following is an example of a multidomestic strategy?
Multiple Choice
Mattel's black Barbie is popular in Africa.
Microsoft offers the same software programs around the world.
Red Bull products are packaged differently for the Chinese market.
BMW designed its 3 Series cars for multiple markets.
Heinz ketchup in India does not have garlic and onion.
Question 9
To use location to build competitive advantage when competing on domestic and international levels, a company must
Multiple Choice
use acquisition and rapid-growth strategies to better defend against expansion-minded internationals.
try to change the local market to better match the way the company does business elsewhere.
be prepared to modify aspects of the company's business model or strategy to accommodate local circumstances.
consider (1) whether to concentrate each activity it performs in a few select countries or disperse performance of the activity to many nations, and (2) determine in which countries it should locate particular activities.
transfer company expertise to cross-border markets and initiate actions to contend on an international level.
Question 10
Factors that do not make competing across national borders more difficult than competing domestically include
Multiple Choice
country-to-country differences in consumer buying habits and buyer tastes and preferences
the difficulty in achieving strategic fit in sales and marketing activities
variations in government policies, tax rates, inflation rates, and other economic conditions from country to country
the potential for location-based advantages in some countries
vulnerability to adverse shifts in currency exchange rates
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