Chapter3Review - MGMT 425 Chapters 3 Review Questions 1....

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MGMT 425 Chapters 3 Review Questions 1. Using the five-forces model of competition to determine what competition is like in a given industry involves A. building the picture of competition in three steps: (1) identifying the specific competitive pressures associated with each of the five competitive forces; (2) evaluating how strong the pressures comprising each competitive force are; and (3) determining whether the collective impact of all five competitive forces is conducive to earning attractive profits. B. building the picture of competition in two steps or stages: (1) determining which rival has the biggest competitive advantage and (2) assessing whether the competitive advantages possessed by various industry members allow most industry members to earn above-average profits. C. evaluating whether competition is being intensified or weakened by the industry's driving forces and key success factors. D. assessing whether the collective impact of all five forces is weak enough to allow industry members to go on the offensive or, instead, requires use of a defensive strategy to insulate against fierce competitive pressures. E. gauging the overall strength of competition based on how many industry rivals are operating with a competitive advantage and how many are operating at a competitive disadvantage. 2. Factors that cause the rivalry among competing sellers to be weak include A. low buyer switching costs and rival sellers that are relatively equal is size and capability. B. rapid growth in buyer demand and high buyer switching costs. C. few industry rivals that any one company's actions can easily be anticipated and countered by its rivals. D. low barriers to entry and weakly differentiated products among rival sellers. E. slow growth in buyer demand and strongly differentiated products. 3. Rivalry among competing sellers is generally more intense when A. there are relatively few industry key success factors and rivals have highly differentiated products. B. the industry's driving forces are strong and rivals have strongly differentiated products. C. barriers to entry are moderately high and the pool of likely entry candidates is small. D. rivals are active in making fresh moves to lower prices, introduce new products, increase promotional efforts and advertising, and otherwise gain sales and market share. E. barriers to entry are high and buyer switching costs are high.
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4. Rivalry among competing sellers grows in intensity when A. rivals' products/services are sold at widely varying prices and there are only 2-4 rivals. B. rivals have highly differentiated products and buyer demand is growing rapidly. C. there are so many industry rivals that the impact of any one company's actions is spread thinly across all industry members. D. the products/services of rivals are strongly differentiated and buyers have high switching costs.
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This note was uploaded on 07/03/2011 for the course ECON 101 taught by Professor Ramiz during the Spring '11 term at Abilene Christian University.

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Chapter3Review - MGMT 425 Chapters 3 Review Questions 1....

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