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CH01_Testbank_HIH9e

CH01_Testbank_HIH9e - Chapter 1Strategic Management and...

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Chapter 1—Strategic Management and Strategic Competitiveness TRUE/FALSE 1. The Opening Case shows that McDonald’s is one of the few firms able to achieve strategic competit- iveness from its founding until the present time. ANS: F PTS: 1 DIF: Medium REF: 3 OBJ: 01-01 TYPE: application NOT: AACSB: Multicultural & Diversity | Management: Environmental Influence | Dierdorff & Ru- bin: Managing strategy and innovation 2. By focusing on product innovations and upgrades of its properties, McDonald’s was able to achieve strategic competitiveness and above average returns. ANS: T PTS: 1 DIF: Medium REF: 3-4 OBJ: 01-01 TYPE: application NOT: AACSB: Business Knowledge and Analytical Skills | Management: Strategy| Dierdorff & Ru- bin: Managing strategy and innovation 3. Strategic competitiveness is achieved when a firm successfully formulates and implements a value- creating strategy. ANS: T PTS: 1 DIF: Easy REF: 4 OBJ: 01-01 TYPE: knowledge NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru- bin: Managing strategy & innovation 4. Part of McDonald’s strategy was the choice that it would remain involved in additional food concepts such as Boston Market and Chipotle. ANS: T PTS: 1 DIF: Easy REF: 4 OBJ: 01-01 TYPE: application NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru- bin: Managing strategy & innovation 5. Alligator Enterprises has earned above-average returns since its founding five years ago. Since no oth- er firm has challenged Alligator in its particular market niche, the firm’s owners can feel secure that Alligator has established a competitive advantage. ANS: F PTS: 1 DIF: Hard REF: 5 OBJ: 01-01 TYPE: application NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru- bin: Managing the task environment 6. The goal of strategic management is to develop a competitive advantage that is permanent. ANS: F PTS: 1 DIF: Medium REF: 5 OBJ: 01-01 TYPE: comprehension NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru- bin: Managing strategy & innovation
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7. Risk in terms of financial returns reflects an investor’s uncertainty about economic gains or losses that will result from a particular investment. ANS: T PTS: 1 DIF: Easy REF: 5 OBJ: 01-01 TYPE: knowledge NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru- bin: Foundational skills 8. Average returns are returns in excess of what an investor expects to earn from other investments with a similar amount of risk. ANS: F PTS: 1 DIF: Medium REF: 5 OBJ: 01-01 TYPE: knowledge NOT: AACSB: Business Knowledge & Analytical Skills | Management: Strategy | Dierdorff & Ru- bin: Foundational skills 9. Returns can only be measured in accounting terms such as return on assets, return on equity, or return on sales.
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