CH06_Testbank_HIH9e - Chapter 6—Corporate-Level Strategy...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Chapter 6—Corporate-Level Strategy TRUE/FALSE 1. In the Opening Case, Foster’s Group’s sharing of marketing and distribution in its beer and wine busi-nesses was intended to create economies of scope. ANS: T PTS: 1 DIF: Easy REF: 157 OBJ: 06-01 TYPE: application NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru-bin: Strategic & systems skills 2. According to the chapter Opening Case about Foster’s Group, the use of a single sales force to sell mass market and premium products was highly successful. ANS: F PTS: 1 DIF: Medium REF: 157 OBJ: 06-01 TYPE: application NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru-bin: Strategic & systems skills 3. Foster’s Group discussed in the Opening Case is an example of a firm following the related con-strained diversification strategy (i.e., different businesses that are highly related). ANS: T PTS: 1 DIF: Easy REF: 157 OBJ: 06-02 TYPE: application NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru-bin: Strategic & systems skills 4. Corporate-level strategies are strategies a firm uses to diversify its operations from a single business competing in a single market into several product markets and, most commonly, into several busi-nesses. ANS: F PTS: 1 DIF: Medium REF: 158 OBJ: 06-01 TYPE: knowledge NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru-bin: Managing strategy & innovation 5. If the businesses in the corporate portfolio are not worth more under the management of the corpora-tion than they would be under any other ownership, then the corporate-level strategy has failed. ANS: T PTS: 1 DIF: Medium REF: 158-159 OBJ: 06-01 TYPE: comprehension NOT: AACSB: Business Knowledge & Analytical Skills | Management: Creation of Value | Dierdorff & Rubin: Managing strategy & innovation 6. An effective corporate strategy creates aggregate returns across all businesses that exceed what those returns would be without the strategy and contributes to the firm’s strategic competitiveness and abil-ity to earn above-average returns. ANS: T PTS: 1 DIF: Medium REF: 158-159 OBJ: 06-01 TYPE: comprehension NOT: AACSB: Business Knowledge & Analytical Skills | Management: Creation of Value | Dierdorff & Rubin: Managing strategy & innovation 7. A major advantage of diversification is that overall monitoring costs are reduced, since each separate business comes under the control of corporate headquarters. ANS: F PTS: 1 DIF: Medium REF: 159 OBJ: 06-01 TYPE: comprehension NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru-bin: Managing administration & control 8. Successful product diversification is expected to increase the variability in the firm’s profitability since the earnings are generated from several different business units....
View Full Document

This note was uploaded on 10/21/2011 for the course ACCOUNTING 101 taught by Professor Fenjimo during the Spring '11 term at College of Southern Idaho.

Page1 / 36

CH06_Testbank_HIH9e - Chapter 6—Corporate-Level Strategy...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online