tif_ch06 - Chapter 6 Formulating Strategy Multiple Choice...

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Chapter 6 – Formulating Strategy Multiple Choice Questions 1. The process by which a firm’s managers evaluate the future prospects of the firm and decide on appropriate strategies to achieve long-term objectives is called ____________. a. strategic planning (moderate, page 220) b. internal resource analysis c. environmental scanning d. product planning 2. The basic means by which a company competes—its choice of business in which to operate and the ways in which it differentiates itself from its competitors—is called its ____________. a. policy b. procedure c. strategy (easy, page 220) d. process 3. Europe is currently attracting much new investment capital because of ______________. a. low labor costs in Europe b. the opening of new markets in Eastern Europe (difficult, page 221) c. lack of new investment opportunities in Asia d. lack of new investment opportunities in North America 4. Which of the following is NOT a reactive reason that prompts a company to go overseas? a. to get around restrictive trade barriers b. to respond to new emerging consumer demands c. to respond to the moves of its foreign competitors d. to seek economies of scale (difficult, page 221) 5. ______________ and ______________ are two reactive reasons for a firm’s going international. a. International competition; trade barriers (difficult, page 221) b. Trade barriers; economies of scale c. Customer demands; cost savings d. Economies of scale; cost savings 6. The U.S. pharmaceutical maker SmithKline and Britain’s Beecham merged for what primary reason? a. to pursue new customer demands b. for economy of scale reasons c. because of limited domestic expansion opportunities d. to avoid regulations and restrictions on the home front (difficult, page 221) 7. ______________ and ______________ are two proactive reasons for a firm’s going international. a. International competition; trade barriers b. Trade barriers; economies of scale c. Customer demands; cost savings d. Economies of scale; cost savings (difficult, page 222) 8. According to an executive of Philips from Holland, only with a global market can a company afford the large development costs necessary to keep up with ______________. a. domestic competition b. joint ventures c. advancing technology (difficult, page 222) d. government regulation 255
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9. What is perhaps the most likely reason why McDonald’s has aggressively expanded internationally? a. to cut costs b. to find new sources of financing c. to overcome limited expansion opportunities at home (moderate, page 222) d. to establish economies of scale 10. The first phase of the strategic management process starts with the company ______________. a. determining what its mission and overall objectives are (moderate, page 224) b. doing a SWOT analysis c. conducting an environmental assessment d. completing environmental scanning 11. All of the following statements about strategic planning are true EXCEPT: a. companies define or clarify missions before they assess the external environment. b.
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This note was uploaded on 06/29/2011 for the course BUS MAN 3611 taught by Professor Li during the Spring '11 term at FAU.

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tif_ch06 - Chapter 6 Formulating Strategy Multiple Choice...

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