competitive advantage only if they are ____ resources. a. nonsubstitutable b. substitutable c. reliable d. expensive e. imitable ANS: A For a firm’s resources to provide sustainable competitive advantage they must be rare, imperfectly imitable, and nonsubstitutable. PTS: 1 DIF: Moderate REF: 97 NAT: Level I Knowledge TOP: AACSB Analytic KEY: Strategy | Creation of Value 10. The first step in the strategy-making process is to ____. a. assess the need for strategic change b. conduct a situation analysis c. choose strategic alternatives d. evaluate the impact of changes on the internal environment e. create a strategic budget ANS: A See Exhibit 6.1. PTS: 1 DIF: Easy REF: 98 NAT: Level I Knowledge TOP: AACSB Analytic KEY: Strategy 11. NTL is the largest cable company in the United Kingdom. The company has recently declaredbankruptcy and needs to engage in restructuring in order to give it more flexibility and allow it to raisecapital. Since it has identified the need for strategic change, what would be the organization's next stepin this strategy-making process? a. finding the optimal strategic solution b. brainstorming c. conducting focus groups d. assessing the need for strategic change e. conducting a situation analysis ANS: E See Exhibit 6.1. PTS: 1 DIF: Moderate REF: 98 NAT: Level I Knowledge TOP: AACSB Analytic KEY: Strategy 12. Top-Flite manufactures Strata golf balls and prices these balls at about three times what ordinary golf balls cost. The Strata ball sells exceptionally well because customers perceive its patented three-layer construction to improve handling and increase distance. The patent on these golfballs gives Top-Flite a(n) ____. a. sustainable competitive advantage
b. aggregate marketing strategy c. reliable differentiation d. strategic stance e. differential stance ANS: A The Strata product is difficult to imitate, valuable, rare, and without substitutes. PTS: 1 DIF: Moderate REF: 96 NAT: Level II Comprehension TOP: AACSB Analytic KEY: Strategy | Creation of Value 13. An organization is experiencing ____ when it is reluctant to change strategies or competitive practices that have been successful in the past. a. strategic dissonance b. strategic inertia c. competitive dissonance d. competitive inertia e. sustained competitive disarray ANS: D PTS: 1 DIF: Moderate REF: 98 NAT: Level I Knowledge TOP: AACSB Analytic KEY: Strategy 14. One of the reasons why the highly fragmented chemical industry in Europe has experienced decreasing profits is an industry reluctance to change the way it conducts business, especially in how it competes against lower-priced U.S. imports. This is an example of ____. a. competitive dissonance b. strategic apathy c. competitive inertia d. strategic inertia e. competitive apathy ANS: C Competitive inertia is defined as a reluctance to change strategies or competitive practices that have been successful in the past.
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- Management, AACSB Analytic, AACSB Reflective Thinking